Patient Financial Communications

The Path to a Patient-Centric Revenue Cycle

November 28, 2018 9:42 am

The proliferation of high-deductible health plans, along with today’s rising healthcare costs, is prompting patients to demand more information from providers about their care costs and financial responsibilities. Not only do they want more detail, but they also want it timely and in an easily digestible format. They also expect a degree of service like what they receive from retail, travel, and other industries. However, healthcare billing and payment remains complex, and organizations often struggle to effectively capture patient payment while meeting consumer expectations.

To learn more about organizations’ perspectives on and strategies around patient collections and how these interface with other revenue cycle functions, the Healthcare Financial Management Association (HFMA) conducted a focus group that included several senior leaders from health systems, hospitals, medical groups, and providers. This Research Highlight, sponsored by Virence Health, delves into three key themes that emerged during the discussion.

Theme One: A Combined Business Office Is Valuable

All focus group participants had some form of combined business office (CBO) in place and indicated they were happy—or at least somewhat happy—with it. They also stated that a well-designed CBO can be a positive influence on patient relationships because it boosts process efficiency and tightens service delivery to make things more consumer-friendly.

During the discussion, it became apparent that each participant had his or her own definition of what a CBO is and how it could facilitate collaboration between departments and with patients. In some cases, the CBO included only back-end functions, while in others it encompassed both front- and back-end operations. A few organizations had a CBO that handled both hospital and physician practice billing, while others kept the two sides separate.

“I see the value of a centralized business office including the back-end business processes as well as front-line access areas,” says Beth Book, director of revenue cycle for Blanchard Valley Health System in northwest Ohio. “When both the front- and back-end staff report to the same leadership team, you can look at the entire continuum from the point of first patient contact and expectation-setting through to the follow-up collections process after the bill has dropped. By viewing things holistically, you have a better chance of creating a patient-friendly highly reliable collections effort.”

The group agreed that it is increasingly important to give providers and patients access to a single view of the entire healthcare financial experience. “The fundamental role of the business office is to provide this insight,” says David Haight, general manager of solutions at Virence Health. “When people talk about a CBO, they sometimes refer to it as a combined billing office. However, it should be more than that, functioning as a combined business office. It’s that end-to-end view that is necessary because it allows you to make strategic choices, moving some aspects of the revenue cycle upstream to make the overall process more efficient and patient-focused.”

The group cautioned against having the CBO be a siloed entity and suggested that greater success comes when the department facilitates communication with other aspects of the revenue cycle and with patients. “We’re starting something new to bridge the information gap between the patient access function and the CBO,” says Gerilynn Sevenikar, vice president of the revenue cycle for Sharp Healthcare in San Diego. “When these two groups aren’t aligned, it’s easy for staff to fall into an ‘us and them’ mentality. In an effort to break down some of those barriers, we have reclassed a back-end position into a revenue cycle experience coordinator, whose job it is to journey out and serve as the first point of contact for the CBO. This will help us address any service gaps and educate the front-end staff about what happens after the patient receives care. The revenue cycle experience coordinator can then share information with the back-end on what needs to be communicated to draw the two teams together. We are also working to centralize our pre-service unit, so that the CBO and pre-service functions can more seamlessly interact with one another.”

Training CBO members on different parts of the revenue cycle is a common strategy. “We have our front-end and CBO staff engaged in job shadowing,” says Melissa Gilmore, manager, enrollment and credentialing for Results Physiotherapy, headquartered in Franklin, Tenn. “We have somebody in the CBO whose sole responsibility is to work with the clinics to make sure that they fully understand why it’s so important to get a copy of a patient’s insurance card and check to see if there’s an authorization on file. Because front desk staff are often multitasking, they may forget to ask for the insurance card and not appreciate the downstream effects of the omission. By having both front- and back-end staff understand everybody else’s role, we are starting to break down the siloes between groups.”

Creating an integrated and collaborative CBO requires strategic forethought. “When designed well, a CBO can make it easier to provide one stop for all services related to patient billing,” says Sandra Wolfskill, director of healthcare finance policy and revenue cycle MAP for HFMA. “It also makes it easier to ensure policies and procedures are developed to apply to the entire delivery system and not individualized to specific providers or locations. When pursuing this type of model, organizations need to make sure that they don’t just bring together formerly separate business offices under one roof. Instead, they should take a more tactical approach, closely examining processes to verify they are streamlined and patient-centered. There is also an opportunity to examine high-volume activities to check if they can be automated or assigned to a robotic process, which can allow human resources to concentrate on more complex tasks.”

Focus group participants indicated that technology plays a crucial role in ensuring CBO success. “A common technology infrastructure that lets staff seamlessly look at data across the continuum can be especially beneficial,” says Virence Health’s Haight. “When a solution connects financial data sets behind the scenes to provide a single view, it benefits the organization and its patients. The organization can see the entirety of a patient’s responsibility and how any deductibles and co-pays apply. When the patient asks what he or she owes, staff can give a reliable and complete answer instead of fumbling through different applications to piece data together. To connect financial data in this manner, organizations need to either use the same technology system across the enterprise or have an analytics engine that lays over the top to help connect the dots.”

Group members also stated that their CBOs were works in progress and that monitoring outcomes that illustrate performance is helpful in ensuring the entity supports the organization in its goals. Metrics to review might include patient satisfaction, cost-to-collect, days in accounts receivable, and so on. When examining these key performance indicators, organizations should ask whether they show that financial processes are efficient and easy to navigate. If not, then more work may be necessary.

Theme Two: There Is a Need for Increased Proactive Communication with Patients

All focus group participants are working to enable a better patient financial experience through various means, such as engaging in up-front eligibility verification, providing cost estimates, and offering payment plans. However, despite their best efforts, none of the individuals involved in the group feel their organization is fully successful at this task. Historically, healthcare organizations have not been overly concerned about communicating with patients regarding their financial responsibilities and providing education about care costs. As such, making this shift is taking time.

One element that participants embraced is the idea of a preservice center that offers patients financial counseling services and assistance before the start of an encounter. “So much of the focus in the past has been on billing and follow-up, and organizations have that piece down,” says Deborah Vancleave, vice president of revenue cycle for Mosaic Life Care in northwest Missouri. “The emphasis now is shifting to front-end financial clearance, including eligibility verification and pre-authorization. By creating a centralized pre-service center, organizations can ensure more consistency with these processes as well as foster accountability and reliability.”

Some participants launched programs within their pre-service offerings to better educate patients on their bills and what the next steps for payment would be. “The biggest complaint we receive from patients is that they don’t understand their bill,” says Cristie Skeen, director of revenue cycle management at Mosaic Life Care. “One thing we’re doing to address this concern is redeploying staff who were previously taking customer service billing calls and moving them to the front-end to help with pre-service outreach. We’re also designing a financial clearance division that works to verify insurance before we get on the phone with the patient for pre-registration. This allows us to have a more focused conversation with the individual about their out-of-pocket costs.”

Other organizations turn to outside resources for help in improving their patient interactions. “When an organization is growing rapidly, it’s hard to maintain consistency around patient financial communications across the enterprise,” says Jerry Artman, financial analyst for Munson Health System located in rural Michigan. “To help us get our heads wrapped around it, we became an enterprise member of HFMA, so we could fully leverage the patient financial communications best practices and training. We are trying to have every employee go through the training, so we get on the same page about how to engage in more patient-focused financial conversations.”

It became evident during the group discussion that the organizations are aiming to become more of a resource to patients rather than merely a bill collector. “We’ve changed our scripting to go beyond just a discussion of what the patient owes,” says Jeff Buehrle, CFO for Banner Health Arizona Rural Hospitals. “We now strive to act more as a partner in demystifying healthcare billing and payment. For example, when we are speaking to patients about what they owe, it can help to frame the conversation in the context of the insurance policy they chose. This gives us an opportunity to educate them about the different components and what things we can do to help them given their current situation. We can also talk to them about applying for Medicaid or other federal and state programs and why this is important, so they don’t end up in collections. By serving as more of a patient advocate and less of a bill collector, we can provide a more patient-centric experience while still capturing payments in an effective way.”

Providers are also working to identify and address patient needs rather than expecting patients to conform to the healthcare organization’s traditional way of doing business. “While St. Jude Children’s Research Hospital does not bill any patients, one of the unique things that we did in my previous life to address those patients who opt to self-pay and who can afford to do so was to develop a flat fee program,” says Pat Keel, CFO for St. Jude’s Children’s Research Hospital in Memphis, Tenn. “If you came to the emergency department and you had a lower acuity condition, then you would pay a certain amount. It was all-inclusive if you paid half up front and the balance within 30 days. If you had a higher-level acuity condition but were not admitted to the hospital, that’s an outpatient program and there was a higher fixed rate fee. If you were admitted as an inpatient, then you would go through financial assistance qualification. We found that about 75 percent of patients followed through and paid, which reduced the workload on self-pay collections. We had a relatively large self-pay population, and by looking across those payments, we determined that a good percentage of those patients had the financial means to pay their bills provided the costs were kept in check.”

Overall, focus group participants are working to identify ways to put patients in the driver seat, giving them choices and input on decisions around their care and how to pay for it. “By providing patients with a view of their costs and responsibilities and then educating them on different options to meet them, organizations can make the patient payment process more customer-centric,” says Haight. “Patients can plan better and make more educated decisions about a path forward. This empowerment can drive patient satisfaction and encourage retention, especially if the organization handles financial conversations in a compassionate manner.”

Theme Three: Interoperable Technology Is a Necessity

Technology can enable both a high-functioning CBO and more patient-centric financial discussions. To be effective, these solutions must be interoperable, so organizations can communicate between settings and consolidate financial information to create single patient bills, enable focused collections, and support integrated payment plans. “Interoperable technology is certainly advantageous for this work,” says HFMA’s Wolfskill. “Vendors whose products have flexibility to work with a variety of other solutions are the most valuable.”

The group agreed that setting interoperability expectations with vendors is imperative. “As a non-hospital system, we have found that most of the vendors are focused more on hospitals or integrating with enterprisewide solutions,” says Gilmore from Results Physiotherapy. “Before we work with a vendor, we let them know that we need them to be able to work and communicate with our existing system. We don’t want to buy something that stands apart and makes work more difficult. I think it’s wise to set expectations up front, so there are no misunderstandings down the line.”

The need for interoperability will only expand going forward. “As an industry, we are moving away from talking about interoperability as merely a nice-to-have,” says Virence Health’s Haight. “The reality is no vendor on the market can completely meet the various needs that health systems, providers, and patients have. There are a lot of great options out there, and many companies are bringing unique insights and features to the table. Organizations should be able to leverage these solutions within their existing platforms to take advantage of best-of-breed solutions. It’s time that interoperability becomes an expectation and that organizations shouldn’t even have to ask whether a solution will work with others—it should be a given. Many vendors are striving to make this a reality right now through common standards, such as HL7 and FHIR. However, it is going to take healthcare organizations and patients coming together and demanding standardization and cooperation before it will be fully realized. While we’re heading in that direction, we’re not there yet.”

Organizations also must commit to regularly revisiting how they’re using technology to facilitate a better financial experience. “They should be constantly asking themselves whether they are as up-to-date as they should be,” says Michelle Vaughn, director of revenue cycle for PhyMed Healthcare Group in Nashville. “It’s not just something to review every year, it should happen more frequently because things are always changing. In the end, you have to put yourself in the shoes of a patient and ask whether you’re doing everything you can to meet their needs.”

A complex but worthwhile journey

Although focus group participants didn’t settle on any one methodology for cultivating a patient-centric revenue cycle, they did make a few things perfectly clear: This is a work in progress, and something that healthcare organizations are just starting to understand and embrace. However, by committing to this work, and employing technology to enable it, organizations can make progress toward delivering a patient financial experience that is good both for the patient and for business.

About Virence Health

Virence Health is a leading software provider that leverages technology and analytics to help healthcare providers across the continuum of care effectively manage their financial, clinical, and human capital workflows. Virence offers a comprehensive suite of innovative technology-enabled solutions that aim to improve quality, increase efficiency, and reduce waste in the healthcare industry.


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