Executive Roundtable | Innovation and Disruption

Pursuing innovation in the revenue cycle to transform operations

Sponsored by Change Healthcare
Executive Roundtable | Innovation and Disruption

Pursuing innovation in the revenue cycle to transform operations

HFMA Roundtable Participants

Ken Baxter is vice president, revenue cycle for CHOC Children’s in Orange, California

Christy Pehanich is associate vice president, revenue management for Geisinger in Danville, Pennsylvania

Thomas Laur is executive vice president of technology enabled services at Change Healthcare in Boston, Massachusetts

Gerilynn Sevenikar is vice president at Sharp Healthcare in San Diego, California

Dan Malloy is assistant director of revenue cycle for Butler Health System in Butler, Pennsylvania

To make meaningful improvements in today’s revenue cycle, healthcare organizations must think outside the box. Embracing innovation is critical not only to combat shrinking margins but to prepare an organization to navigate new payment models and the ever-changing regulatory environment. In this roundtable, sponsored by Change Healthcare, several revenue cycle leaders discuss how they are pursuing revenue cycle innovation, including their commitment to new and emerging technologies.

What are the driving factors pushing your organization to embrace revenue cycle innovation?

Dan Malloy: I would say tighter margins is a primary factor. At Butler Health, we’ve experienced a decline in reimbursements from both government and commercial health plans, at least over the last five years. We are also seeing more competition in the market from other traditional providers as well as non-traditional sources like minute clinics and virtual care options. As a result, we are looking for ways to streamline operations and avoid revenue leakage.

Christy Pehanich: Innovation has been a long-standing core value throughout Geisinger, and we are always aiming to do things more efficiently and effectively. Factors such as suspected net revenue leakage coupled with shrinking margins call attention to the need to explore new opportunities to solve old revenue cycle management (RCM) problems.

Gerilynn Sevenikar: At Sharp Healthcare, we’re trying to accelerate information delivery to our patients and families and enhance the customer experience. We want to be the system of choice for a consumer and that requires creating and consistently providing high-touch, convenient interactions. San Diego is a closed market: we are bordered by the Pacific Ocean, Mexico, the desert and Camp Pendleton. And we have four primary healthcare systems that are all competing for patients. As such, we are actively implementing methods, such as mobile solutions, that can attract and retain customers and fully meet their expectations.

Ken Baxter: CHOC Children’s is a growing health system. One of our goals is to improve transparency across the organization by getting everyone on the same electronic health record (EHR). Not only will this help us deliver better patient care, but it will allow us to provide clearer billing statements for the family. By associating physician data with facility data, particularly regarding denials, we also can be more proactive about preserving revenue integrity. The combined system will let us leverage more modern technologies as well, such as robotic process automation (RPA) and artificial intelligence (AI).

Thomas Laur: There seems to be two major forces driving healthcare organizations to innovate. First, revenue cycle management as we know it is getting increasingly more complex to execute. Pressured reimbursement models, provider consolidation, diverse technology platforms and constant regulatory changes are all making the process more difficult. Second, financial risk for providers is escalating. Growing patient responsibility is leading to higher levels of uncompensated care and bad debt, and new payment models are pushing for providers to assume more risk. Given these factors, there is a clear need for innovation in the RCM space.

What are some strategic areas in which you are investing or outsourcing? Why did your organization choose these avenues?

Malloy: One area relates to denials that require clinical expertise to resolve. We don’t have sufficient internal resources to effectively handle these denials, and the required skill set can be difficult to hire, so engaging in an outsourcing relationship is beneficial. We’ve also started working with an outside vendor to assist with pre-collect self-pay payments. We’ve always turned to an outside collection agency to obtain payment on the back end, but now we’re starting to ask for payment up front. We have used internal staff for this in the past, but the volume is getting to the point we need outside assistance.

Laur: We’re seeing the majority of revenue cycle outsourcing aimed at the front end, optimizing pre-encounter activities that span financial clearance, including scheduling, coverage verification, pre-payment and so on. There’s an emphasis on engaging patients and helping them manage their financial liability, creating transparency around what’s owed and why.

Providers also are recognizing the opportunity to reframe utilization and better manage capacity. If an organization captures a profile of a patient when he or she accesses the system, then it has a history of that patient within the institution and network. It can use this data to identify where to point the patient for care based on availability and capacity. The airline and logistics industries have done this well. Healthcare is starting to realize the benefits of this approach, but we have a long way to go before it becomes operationalized.

How is your organization using the latest technology to streamline and improve revenue cycle performance?

Pehanich: Geisinger is using RPA in several areas. Our revenue management department looks for rule-based, repetitive processes that are structured and high volume as part of our RPA evaluation criteria. There are many opportunities within patient financial services alone. When you start to examine the intake and scheduling processes, including pre-registration, financial counseling and onsite registration, there are ample opportunities.

Sevenikar: RPA is at the top of our to-do list as well. Finding areas where “bot” deployment improves performance and maintains high quality is key. Right now, we are in the process of creating a full inventory of which revenue cycle functions have repetitive processes that lend themselves to RPA. Claims status checking is rising to the surface as a possible opportunity. We already automate our claims status checking via electronic data interchange (EDI) with any health plan that will take it. The problem is so many health plans don’t take an EDI claim status check, so the technology isn’t able to do what it’s meant to do. EDI also doesn’t completely automate the process. Conversely, with RPA, a bot can go into any health plan’s system, grab the claim status, pull it into our system and interact with it, acting like an employee. The bot can then take the next step with the claim without involving a human. For example, if the health plan is going to ask for a medical record or wants to see detail of charges, an RPA solution can completely close the loop on those requests without involving staff. Bottom line: RPA acts like a human as opposed to technology, which makes it more accepted and useful over the long term.

Laur: Intelligent technologies, such as AI, RPA, machine learning and natural language processing, are focused on two main goals. The first is to increase revenue yield, maximizing and speeding collections and offering greater predictability. The second is to make significant strides in lowering the cost-to-collect. To meet the first goal, organizations are using AI to help prevent denials and underpayments, improve eligibility verification and enhance the financial clearance process. The second objective requires tools like RPA that reduce the amount of labor involved in collecting money. There are opportunities in the mid revenue cycle, health information management (HIM) and coding, which have highly repetitive tasks that are ideal for this type of automation.

Sevenikar: We’ve also done substantial work in the last year using technology to create consumer options for self-serve. To increase transparency, we’ve implemented mobile solutions that allow consumers to easily view statements, get estimates, make payments and view signed documents. Soon our customers will be able to set up their own payment plans as well. Each month, we see more and more movement to self-serve in the revenue cycle, at least for those easy tasks that people just want to take care of quickly. I think most providers are going to realize that offering mobile solutions is not optional: It’s becoming a mandate.

That said, there are some unexpected consequences from the move to mobile. For instance, our customer service teams have been affected because more and more of the calls coming into the customer service center require extensive research or explanation. All those quick, easy calls have shifted online, and the people who are calling customer service require more time, which has put additional stress on the representatives.

How are you using data analytics?

Pehanich: Geisinger uses data analytics to identify and solve problems across the organization. We have found it best to start with a high view of data and seek the capabilities to drill down as we become more aware of what the data is trying to tell us. When you start with loads of raw data, it can become overwhelming, but if you start by answering high-level questions and then follow the data level-by-level to your answer, you can address significant challenges.

Baxter: CHOC Children’s uses analytics to compare anticipated versus actual performance. For example, if we’re expecting a payer to pay within 38 days based on its historical performance, and we are approaching that timeframe and haven’t received payment, our data analytics solution highlights the issue to trigger follow-up. We’ve also used analytics to examine bad debt accruals, anticipating the negative impacts of aging and prompting us to intervene.

Sevenikar: One area in which we’ve found data analytics to be valuable is in providing real-time productivity data to employees, which allows them to see their productivity for the day and how it compares to their peers. We offer this in a gaming format with a leaderboard that staff can watch as they work throughout the day. As they accomplish tasks, they collect points, and the board tells them how far they are from the person that’s just ahead of them, or whether somebody is about to pass them for the day. This sense of competition can boost performance. It’s a similar concept to how step tracking devices can push the wearer to take more steps or be more active to reach their daily goal. There also is recognition built into the game. Staff earn badges and get gifts based on their performance. The program gives leaders and managers quick trending data by employee and team, even down to what a person’s most productive hour of the day or day of the week is. Based on this data, we can implement methods to motivate individuals to smooth productivity dips.

We also are using analytics to monitor each of our health plans, looking at the ratio of observation to total admissions. This is important because a day in observation yields less to a provider than a day as an inpatient. The costs to us are similar, but the reimbursement is less. We’re trying to get a sense of which health plans are relying on observation and how frequently they do it. This insight can enable conversations with health plans to better align on quality of care decisions.

Do you consider technological innovation and data analytics capabilities when choosing a revenue cycle partner? If so, what do you look for?

Baxter: It’s critical to spend time getting to know your organization’s pain points before reaching out to vendors to find out what’s possible. You want to be sure you know your opportunities better than any vendor. When you fully understand the challenges you have, you can then seek a partner who can assist you in overcoming them as opposed to just reacting to what a third party might tell you is needed. I would caution rushing into relationships. Instead, allocate the time to understand your current state and future goals so you engage in a partnership that will truly address your pain points.

Malloy: Look for vendors that not only have the right capabilities but also ones that are able and willing to partner with you to get your needs met. The last thing we want is to have tools that sit on the shelf with nobody using them, or we get a big initial push and then use wanes over time. We find the most success when the vendor is attuned to our goals and mission and provides ongoing training and support. Upgrades should be easy, and the vendor should periodically check in to make sure we’re fully utilizing the tool.

You also want to avoid duplication where possible. While that may seem obvious, it’s not always easy to do. If you buy two tools for different purposes but they have secondary capabilities that overlap, you can get multiple sources of truth, which can cause confusion and double work. To mitigate this risk, we put together a committee that has representatives from across the organization to review our technology, make sure we avoid duplication and check we are not keeping solutions that don’t make sense or need to be replaced.

Sevenikar: From a high level, the vendors we’re looking for right now are ones that would serve as a safety net for our revenue integrity plan. We’re interested in partners that can find, lift or preserve our revenue. And it may involve some creative thinking. For example, wouldn’t it be great if health plans and providers could work with the same vendor around DRGs. If both parties had an agreement that they would use the vendor and mutually accept its DRG determination, it would save everyone time, money and staffing resources. In some cases, things might turn out better for the provider while in others, they might be better for the health plan. Parties could split the expense of the vendor, so it is not influenced by one party or the other. That way health plans and providers can avoid spending money analyzing and fighting DRGs and instead let the money flow to patient care delivery.

What would you say is the future of the revenue cycle?

Pehanich: Consumerism. It has been a long time coming, and we are getting there, but more collaboration with health plans is still needed to enhance the transmission of meaningful data back and forth, so we as an industry can adequately meet consumer expectations. Although we have made some progress in sharing information, not all health plans and providers are at a point where robust information exchange takes place.

Sevenikar: Processes will be more automated, and hospitals and health systems will use more AI and RPA. In addition, the care and financial experiences will be more mobile. We’re building a new hospital, and I recently had a discussion with the people in charge of the project asking if they geofenced the lobby, so that when patients walk in and have their phones, we can acknowledge that they are here and we’re expecting them. By clicking a button on their phones, they can be guided to the correct floor and their admission paperwork can be ready for their signature. Other industries are doing this now. It’s time for healthcare to catch up.

Laur: Five years out, I predict that human touches that currently happen regularly in the revenue cycle will be on an exception basis. I think the field is going to move to a truly AI-enabled discipline that will be more predictive. It’s also going to become more patient-centric with greater attention paid before the clinical encounter. Given these dynamics, I think it’s possible that the revenue cycle management function will morph into more of a patient relationship management platform. Where, in the past, organizations were just collecting revenue and managing a cycle, in the future, they will focus on acquiring new revenue and protecting it. It’s going to become much more of a patient acquisition/patient retention exercise with attention aimed at creating and sustaining relationships.

There also are some interesting conversations taking place in pockets of the market about whether it’s possible to redefine the reimbursement model. The question is whether the industry could work toward real-time adjudication, real-time authorization and greater transparency in terms of what’s owed when and by whom. I think that over the next five to ten years there’s a chance that the standard reimbursement model might evolve, and instead of being one in which we essentially run after dollars, payment would happen at the point of consumption or even before, like it does in other service industries. When thinking about the future of RCM, we cannot avoid considering this reality because conversations are happening that are pushing in this direction. While they’re in pockets today, it’s certainly not unreasonable to believe that there could be more organized conversations in the future or potentially a mandate from the government to move to a new reimbursement model.

About Change Healthcare

Change Healthcare is a leading provider of software and analytics, network solutions and technology enabled services that optimize communications, payments and actionable insights designed to enable smarter healthcare. By leveraging its Intelligent Healthcare Network™, which includes the single-largest financial and administrative network in the United States, healthcare systems, health plans, providers and pharmacies can increase revenue, improve efficiency, reduce costs, increase cash flow and more effectively manage complex workflows. Learn more about Change Healthcare. 

Advertisements

Related Articles | Innovation and Disruption

Blog | Value-Based Payment

Analysis: Aspire Health Founder Brad Smith chosen as new CMMI director

The change in CMMI leadership could mean long-anticipated models are released, and may signal more emphasis on palliative care in future models based on Brad Smith’s background.

Column | Staff Development

How to mesh employee personality types to foster a successful workplace

Leaders should be aware of different personality types and best practices for managing each.

Blog | Partnerships and Value

Analysis: Advanced analytics company partners with Emory Healthcare

If healthcare providers are going to be successful in lowering the cost of healthcare, they may need to find a partner that can crunch the data to help them understand their cost to deliver care at the case/patient level.

Trendsetter | Cost Reduction

Capitalize on purchased services’ unusual suspects to enhance revenue

A transformative healthcare company outlines some conventional and unusual strategies for streamlining purchased services spend to expand margins and drive revenue.