Techies Develop Web Platform for Hospital Fee Collections

When a local credit card processing business went belly-up after the dot-com bust, five of its execs looked at each other, decided they liked working together and asked themselves, “What’s next?”

The result is Benchmark Revenue Management Inc., which offers a Web-based platform to help hospitals get back more of the money they are owed through billing and collections as quickly as possible.

Both Tyson McDowell, chief executive officer, and Lincoln Fish, vice president of business development, use the same example to demonstrate what the platform, which is called RADE2, can do.

Last year, St. Joseph’s Wayne Hospital, a 229-bed, acute-care hospital in Wayne, N.J., said it added $20 million to revenues after implementing Benchmark’s technology.

Focusing on the concept of the ‘Next’ function, the technology prioritizes accounts in the order they need to be addressed to keep workers efficient, according to McDowell.

Data could show that when a hospital worker contacts an insurance company for payment after 14 days, the company may not have processed the forms yet. So the system notes not to make the call until the 19-day mark.

“It’s a case study for generic technology,” McDowell said. ” Health care makes the most obvious incremental difference.”

Tenfold Increases

Benchmark does not disclose revenues, but Fish said that the company’s profits should increase tenfold from 2007 to 2008.

The platform provides workflow management for pre-registration involving “insurance verification, benefit validation, patient demographic collection, authorization, pre-certification and referral management,” according to the company Web site.

McDowell , a 25-year-old “boy genius” who built one of the first Internet shopping carts, said Fish , saw the need for a complete system, not just one that focused on billing or collections, regardless of the industry. It just happened to be health care.

“People see health care (technology) as relatively antiquated,” McDowell said. “But there is massive data complexity.”

In 2002, McDowell, Fish, Olivier Witteveen (chief operating officer and chief financial officer) and John York (vice president of product development) started meeting in hotel lobbies to discuss utilizing the platform that McDowell had wanted to build. Fifth founder Jim Rellas works with Benchmark on a consulting basis now.

They eventually rented a 250-square-foot office, working for a few years on the technology before selecting the health care industry as its focus.

Benchmark partnered with a consulting firm in 2003 that was bought by Chicago’s Navigant Consulting Inc. shortly after. It recently secured funding from San Diego-based Express Ventures.

This year is the year that the staff of 12 will actively pursue hospital contracts and establish its marketing and sales team, according to Fish.

In addition to St. Joseph’s in New Jersey, the technology has been installed at St. Joseph Hospital’s 410-bed facility in Atlanta.

The cost for the service is based on the number of beds, which consists of a flat fee plus monthly subscription.

A 500-bed hospital would pay $150,000 to implement the system and $17,000 for monthly support, according to the company Web site.

Two full-time revenue engineers work with assigned hospitals, dealing with between 30 and 50 people, to optimize the system for each client.

The company claims its technology can increase collection rates by 15 percent; plus generate 20 percent increases in financial clearance rates and 30 percent decreases in write-offs.

“It’s a huge leap up over technology companies,” Fish said. ” We’re the only company out there guaranteeing our result.”

(Benchmark guarantees a six-week implementation as well as increases in collection rate, financial clearance rate at admission and account resolution per worked hour.)

Because of the generic platform , in Benchmark’s early years, there was even talk of using the technology for mortgage processing , McDowell said the next step is to extend the platform to other industries.

“It’s written more in the language of business than in the language of technology,” he said. “We want to master health care, show huge success in the three- to five-year realm.”