Management Action Plan – Receivable Crisis in Stevens County Hospital

The Problem or Opportunity for Improvement

The selected problem in this case is the receivable crisis in the Stevens County Hospital. The hospital is experiencing shortage in its operation account and thus, it cannot manage to pay all its workers at the end of the month. This has been attributed by its inability to collect money from insurance companies, government payables and also from the patients. The inability to collect money from the above mentioned individuals is due to inefficiency in a number of employees operations and the old computer that keeps on failing those trying to submit their bills. There are doctors who have not managed to complete their charts and thus, delaying billing. Some departments are not efficient in capturing service charges and thus, some billings can never be made. Moreover, those approving payment by insurance are not careful enough on what is payable by insurance and what is not payable by insurance. In this regard, most insurance claims are being denied.

The main opportunity for improvement can only be attained by streamlining the billing operations of the hospital so that the hospital can manage to fulfill all requirements for billing. Doctors should complete their charts early enough to allow early billing. All medical departments should perform their duties effectively to ensure all services are billed without any mistakes or exceptions. The department responsible of defining insured cases should counter check what is or not insured to ensure that the patients have settled what they are required to do. The hospital should also consider setting aside some funds to purchase a new and powerful computer to handle all the data sent to it swiftly to avoid such delays in future.

The problem need to be resolved immediately since the hospital need to meet its payroll which is due on Friday; a few days from the time of the problem reporting. Some of the consequences that the hospital may suffer for not being able to handle the situation include, inability to pay all its workers which may result to a go slow and thus, polarizing the hospital operations. In addition, the inability to resolve the problem will result to a conflict between the hospital management and its board of directors. The inability to solve this problem may also results to huge losses in the future and thus, making it hard to keep the hospital operational.

Measurable Goal

The desired outcome in the MAP is the development of an effective running billing process and billing system in the company. In this case, I am trying to obtain a well defined process billing system that is done within the shortest time possible. In this system, there will be a high level of commitment and accountability. In this case, every individual who takes part in the billing process will have a deadline to submit his or her documents failure to which, a defined punishment will be imposed on that individuals. There will be a new policy governing billing process to force on commitment and accountability. The accountability will highly focus on unbilled services and cases referred to the insurance though they have not adhered to the insurance requirements. The chief financial officer will have the general role to foresee this. Moreover, the right facilities such as computers will be provided to ensure no delays or other future failures.

The success of this MPA will be measured on the amount of the cash that the hospital will have in its operational account before the end of each month. It will also be measured based on rejected insurance claims, late charts from doctors and cases of individuals who have not been billed and those who have not managed to pay their bills due to the system problem. It will also be measured by the numbers of time different department experience problems of sending their bills into the computer via the upgraded system: numbers of computer failure. The main constrain at the moment is enough money to implement the new MAP. Other constrain include the need for board to approve the new policies to be imposed to enhance efficiency. Time constrain is also a factor as this need to be done as soon as possible. There is also challenge of change, not all workers will be willing to experience this change and thus, more effort will be required in introduction of this change in the organization.

Possible Actions

The current problem was initiated by poor billing system and procedure. The procedure is involving too many people such that a mistake of one particular individual can highly cost the end output of the system. People involved in this process have more important commitments as compared to billing. They also have an ethical code to adhere to which put money in the second position. In this regard, the system can never be effective. The billing system is also not completely automated and the hardware available is not powerful to handle the current half-manual system. Therefore, a solution is required. Some of these solutions include automating the billing system completely, setting aside a department for billing only and unburden the doctors from this procedure,  and streamlining the current semi-automated system to ensure that every person involved in this process is effective and committed to it, in this case a new computer will be required too. The hospital should consider inviting internal consultants for advice on how to run the process, financial management should also consider taking control of the billing process and the full responsibility of the same. Nurses should also consider assisting doctors with completing of billing formalities. The above list gives possible solutions. However, not all will get to the final stage since cost-benefit analysis will be used to eliminate the less effective proposed solutions.

Analyzing and Prioritizing Key Action Steps

The most important step for now is to try and streamline the current system and make it more effective. This will include each department carrying out its role in billing effectively and on time. Nurses should consider assisting doctors in filling the forms to ensure that they are done on time. The financial manager should always countercheck the billing done by every department particularly the insurance billing and individual billings, financial manager should also consider funding the purchase of a new computer, the financial management department to enhance the billing process by counter checking everything before submission to related agencies. The actions that can be dropped from the list without much problem include inviting internal consultant to advice on billing process, automating the system and setting billing department where all billing procedures can be done.

Organizing the Key Action Steps into a Management Action Plan

            The first step would be to ensure that there is a computer that can handle the entire billing load and have the ability even to handle more just in case this will be needed. This will involve defining the source of fund, doing price and specification research, getting funds and purchasing it.  Ensure that each individual who is involved in billing in the current system act responsibly. Ensure that nurses assist doctor in completing the charts on time. This will involve collecting the patient data, patient analysis, patient evaluation and prescription, filling of the forms, admission, evaluation of the patient expenses, and billing. Ensure everything is counterchecked by the financial manager before billing. Thus, billing will be done by the financial manager after receiving all documents from all departments.     


            The role of ensuring that the billing has been done effectively will be assigned by one senior individual in each department. Each department will have an individual acting as a team leader. All people concerned with billing in that department will forward their forms to this individual. The team leader will then report to the financial manager who will then take care of the billing.   

Measurement and Monitoring

            The performance of this system will be monitored by the team leader and the financial manager. The team leader will ensure that each member adheres to the set billing policies or face the punishment. There will be a sheet for each employee involved in billing to fill to show details on submission, and the form number to ensure punctuality and accuracy. This form will be used to measure performance, remarks will be made at the end by the billing team leader and later by the financial manager. Other performance measures will include checking on the hospital operational account to see if they are increasing. The efficiency of the system will be evaluated by checking on rejected claims in the insurance, unpaid individual bills, and the efficiency in processing them.

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