The Impact of Uncertain Revenues on Emergency Department Financial and Clinical Operations

This presentation is part of : Strategies in Critical Care

Elizabeth J. Klein, BSN, Pediatric Emergency Department, St. Peter's University Hospital, New Brunswick, NJ, USA and Thomas Cox, PhD, RN, Department of Supportive Sciences and Health Systems, Seton Hall University, College of Nursing, Gainesville, FL, USA.

Background: The size, location, financial strength, and organizational placement of service departments impact their ability to manage uncertain revenue streams, such as those emerging from managed care, capitation, and retrospective audits. Additionally, compulsory service requirements under the EMTALA exacerbate extant financial vulnerabilities and inaccurate assessments of clinical and financial efficiency and effectiveness of acute care facilities. Uncertain finance mechanisms constrain costs; and lead to clinical and financial evaluations that may severely and negatively affect small units such as Emergency Departments and this, in turn, may lead to exacerbations of disparities in access to or availability of much needed healthcare services.

Approach: The authors completed a case study of an urban Emergency Department during a nursing economics class. The authors interviewed administrators, managers, support staff and clinicians, and reviewed manuals and procedures to describe the impact of uncertain service revenues for voluntary and compulsory care and assessed Department evaluation methodologies.

Major Points & Rationale: Uncertainty with respect to reimbursement for healthcare services affects all operations, including: Admissions, financial, accounting, nursing, discharge planning, and collections and especially units such as Emergency Departments which are gateways to additional services. Nurses who understand the complexity of the financial, managerial, and clinical implications of compulsory care operations can better advocate for their services in reviews of financial and clinical performance.

Conclusions: This case study report provides important insights into the clinical, financial, and managerial consequences of compulsory acute care in an urban hospital Emergency Department. Nurses involved in similar units and facing the impact of revenue uncertainty and misallocation of costs and revenues will be better advocates for services critical to community health and well being.

Learning Objective #1: Describe the sources and reliability of revenue streams impacting emergency department operations.
Learning Objective #2: Describe alternative methods for evaluating financial and clinical efficiency under the influence of uncertainty with regard to payment for services.