As hospitals and health systems navigate the choppy waters of the change from fee-for-service to value-based care, one foundational area of their business that demands their attention is the revenue cycle. 

The challenges that many healthcare providers are facing in the revenue cycle are compounded by the fact that they are still in the wake of an electronic health record (EHR) implementation. 

Tim Kinney“As we look around in early 2018, most hospitals, physician groups, and academic medical centers have selected their EHR systems, and they've invested significant time, money, and resources,” says Tim Kinney, managing director with Chicago-based Navigant. “But now we're at the point within the revenue cycle—and in the industry as a whole—where boards have approved and CFOs have championed EHRs, and CFOs are asking, ‘Are we leveraging the system? Are we getting any ROI? And beyond that, what type of automation can we drive out of this new system?’”

Where We Are Now

Although the basic tenets of revenue cycle management remain unchanged, the tools available to do the job certainly have. “These EHRs have great technology built in, but taking advantage of that technology also requires processes and people,” Kinney says.

“Health systems are attempting to get onto an integrated IT platform, with a comprehensive EHR and a patient financial system,” says Ben Colton, principal with ECG Management Consultants, Seattle. “And that’s a difficult thing to accomplish.” Organizations that decide to move in this direction sometimes find the system they have selected may not meet the needs of all the constituent entities, Colton suggests. For example, the EHR system may be more focused on the hospital enterprise and not on meeting the needs of the physician enterprise.

One strategy many healthcare organizations are using to quickly broaden the utility of existing systems is through outsourcing revenue cycle development and perhaps operations, too.

Ben-Colton“A lot of CFOs are exploring the idea of outsourcing their revenue cycle operations,” Colton says. “The challenge for them with that approach is making sure they are getting the value and level of integrity they need.” With such a strategy, it will be important for them to establish appropriate contracts at the outset that include service level standards, Colton says.

Some organizations fully outsource their revenue cycle operations, which raises the stakes. “Then the question becomes, how do you maintain control when you have essentially handed over the keys to a third party?” Colton says. “How do you get the same level of support and value out of that revenue cycle when you do not have direct control?”

Clearly, there are benefits to keeping revenue cycle operations in-house, as many organizations are doing. Among other things, that saves hospital leaders the challenge of having to figure out how to “in-source” these operations again when they’ve had enough of outsourcing.

Where We're Going

Several trends are emerging as healthcare providers explore ways to get more out of their EHR investment.

The call center approach. “There’s a shift on the front end toward a single patient touch, much like what is used in call centers,” Kinney says. The goal is to improve customer service from the first contact with the organization. Part of the reasoning behind this change is to increase efficiency, and therefore ROI. But it also is intended to improve patient satisfaction, which has become increasingly important with the onset of value-based payment.

Developing revenue integrity units. With all the heavy-duty computing power that is now in place in their organizations, CFOs taking the lay of the land frequently are finding holes in the system. “Financial leaders are asking tough questions, like ‘Who’s protecting my gross revenue to make sure we’re capturing every charge?’ and subsequently, ‘Who’s making sure we’re getting paid all that we are owed?’” Kinney says. Until recently, few organizations took this type of unified proactive approach to ensure they were being paid the full amount to which they were entitled. 

“But with a large portion of revenue still coming from fee-for-service type arrangements, it is important for providers to make sure they are being reimbursed appropriately,” Kinney says. “So I think revenue integrity is a pivotal unit within revenue cycle, and we’re going to see it grow into a problem-solving function for hospitals and health systems.”

Automation. Tapping the capabilities of EHR systems to automatically process revenue cycle and other tasks has tremendous potential to boost efficiency. “How do I make sure that an account that's about to hit timely filing with an insurer goes to the top of the work list? There's functionality that can do that now automatically,” Kinney says. 

Many repetitive tasks in the revenue cycle are good candidates for automation, sometimes using robotic processing automation (RPA) tools and sometimes through manual programming. Certain types of denials are well suited to automation. “Think about a claim that is denied just because it needs an explanation of benefits or something else that I don’t need a person to attach. I can go into the system, see that denial code, and write a script to automatically attach what’s needed and get it out the door,” Kinney says.

Digital follow up. The industry-wide push to implement EHRs has catalyzed a digital transformation in health care. Even now, patients commonly receive text messages, email reminders, and automated calls. They also are directed to patient portals where they can check coverage, make appointments, complete forms, set up payment plans, and more. The result, with a little luck: better communication and workflow, and more satisfied patients.

What You Need to Know

  • It is critical to establish a baseline before making any sort of change to current business systems, revenue cycle or otherwise, and then to determine the appropriate metrics and develop a reporting suite to determine if performance levels after the change are meeting expectations. 
  • When it comes to revenue cycle operations, it is important to remember the work is accomplished only through the aggregation of all the people, processes, and technology, and to recognize the impact any key decisions will have on these individuals’ ability to perform.
  • The plan for success in leveraging an EHR investment: Figure out the business case and where processes are repetitive, and make sure to keep a steady eye on key metrics.

Publication Date: Tuesday, May 01, 2018