Enterprisewide Revenue Cycle Management Reduces Costs, Improves Patient Loyalty
Organizations seeking fiscal stability must look beyond outcomes reporting and cost reduction to streamlining revenue cycle operations.
Enterprisewide revenue cycle management consolidates disparate revenue cycle departments into one unified, cost-reducing, and patient-centric operation that promotes data exchange, healthcare efficiency, and patient loyalty. In an enterprisewide revenue cycle, patients can seamlessly schedule multiple appointments throughout the entire healthcare system during a single call or electronically. They provide their financial and demographic information only once, and they receive an accurate cost estimate before services are rendered. They also receive one consolidated bill that includes all charges regardless of setting and a clear explanation of what they owe and why.
This may sound like a utopian healthcare environment, but it will soon be the reality in most healthcare systems nationwide as organizations continue to focus on cost reduction and look for ways to attract and retain patients, says Sandra Jacobs, CEO and founder of Jacobus Consulting. Jacobs recently shared why enterprisewide revenue cycle management makes sense and how organizations can begin to move toward this model.
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What’s the biggest challenge for organizations as they move toward enterprisewide revenue cycle management?
Jacobs:Addressing the paradigm shift of putting patients at the center of the revenue cycle process. This requires a cultural shift that embraces rapid change across the enterprise. It also requires organizations to act now. Patients may currently tolerate the hassle of having to call multiple providers and fill out paperwork repeatedly, but not for long. Millennials and generation Z-ers have already begun to demand faster access to care and a more streamlined approach to scheduling appointments, providing personal information, and paying their bills. Organizations that delay the transition to an enterprisewide revenue cycle will likely lose consumers to their patient-centric competitors that are willing to change and evolve.
How does enterprisewide revenue cycle management benefit healthcare organizations?
Jacobs: First, a streamlined approach to revenue cycle management reduces operational costs by as much as 15 percent. Fewer employees are needed to perform the same amount of work. Second, an enterprisewide approach provides greater insight into the root causes of denials, delays, and underpayments across the continuum of care. Once these are addressed, organizations may be able to uncover additional revenue—often 3-7 percent—that would have otherwise fallen under the radar.
For example, if a physician receives a denial due to an unspecified diagnosis code, chances are likely that the hospital will receive that same denial when that patient is admitted. Without an enterprisewide approach, the denial may be corrected in one—but not both—settings. An enterprisewide revenue cycle connects the dots between multiple settings, providing organizations with the opportunity to correct potential denials simultaneously.
Third, it helps organizations evaluate the accuracy of value-based payments across service lines and settings—a task that’s nearly impossible when using disparate billing systems and separate workflows for a single episode of care. The enterprisewide approach makes it easier to reconcile costs with payments.
Fourth, when employees are cross-trained as part of an enterprisewide department, organizations become more agile and able to allocate resources where needed. An inpatient coder, for example, can assist with physician office-based coding and vice versa. A scheduler can provide financial counseling and help patients apply for assistance programs.
Fifth, it improves market share and customer loyalty because patients appreciate streamlined access to care.
Finally, it can improve outcomes because patients may be more likely to follow through with non-emergent care (e.g., physical therapy or chronic care management) when there’s less paperwork, increased awareness of out-of-pocket expenses, and fewer phone calls.
Are more organizations moving toward this model? Why or why not?
Jacobs: Enterprisewide revenue cycle management is becoming more common—especially among large healthcare systems and accountable care organizations. Rural and community health systems are also beginning to lay the foundation for this type of coordination as part of cost reduction and patient centric strategies. However, enterprisewide revenue cycle management will eventually become the norm. Consumerism, mergers and acquisitions, new technology, and value-based payments will continue to compel organizations to rethink the value they provide to patients. This includes the ability to streamline the financial aspects of healthcare, such as registration, authorizations, and pricing.
In the last three to five years, the EHR (electronic health record) and additional add-on solutions have given us the ability to provide this type of revenue cycle management. However, organizations need to reengineer their workflows and invest in education and cross-training to make it happen.
What are the types of costs associated with moving toward this model?
Jacobs: Education and cross-training will be the biggest costs. There may also be costs associated with migrating multiple entities onto the same EHR if that’s the direction in which the healthcare organization chooses to move. Finally, there could be consulting costs associated with creating newer consolidated workflows. The good news is that many revenue cycle tasks can be done remotely, helping organizations save on overhead costs.
What strategies can healthcare organizations use to implement enterprisewide revenue cycle management?
Jacobs: First, organizations must create a vision. How will the enterprisewide revenue cycle serve and benefit patients, and how will it tie to the mission and core values of the organization? Next comes the strategic planning. What will the organizational structure and workflow look like before and after the migration to an enterprisewide model?
Third, organizations must evaluate their current technology. Many large EHR vendors offer an enterprisewide revenue cycle solution. If your vendor doesn’t offer this, consider adding additional technology to support the enterprisewide revenue cycle strategy.
If eventually replacing your EHR is part of the overall strategic information technology plan for your organization, look for one that can provide enterprisewide functionality. Although a single EHR platform is ideal when converting to an enterprisewide revenue cycle model, it’s not imperative. Organizations may continue to retain disparate systems throughout the enterprise. However, they’ll need to standardize financial data by completing a current state analysis of data collected throughout the revenue cycle and a gap analysis between all entities. They’ll also need to create a strategy to develop standard data sets for collections and train all staff members so data can be exchanged easily among entities.
Finally, organizations need a strategy for cultural integration that combines hospital, ambulatory, and physician revenue cycle employees from multiple organizations. This may require significant education for staff members accustomed to working in silos. Managers must help staff think outside the box so they realize what they’re capable of accomplishing.
Lisa A. Eramo is a freelance writer based in Rhode Island.
Interviewed for this article:
Sandra Jacobs is CEO and founder of Jacobus Consulting.