Case Study | Cost Reduction

3 tactics for unlocking value in healthcare operations

Case Study | Cost Reduction

3 tactics for unlocking value in healthcare operations

During the HFMA Digital Annual Conference 2020, select companies presented 10-minute case studies around solutions that are driving improved operational and revenue cycle performance in healthcare. Here, three organizations share their approaches and the results achieved.

How Adventist Health’s move to the cloud enhanced clinical excellence and reduced costs

As Adventist Health doubled in size, with more than 20 acute hospitals and 3,200 beds, growth outpaced the capabilities of its legacy systems. As a result, challenges with redundant data entry and broken processes threatened the health system’s goal of increasing revenue from $4 billion in 2016 to $6 billion in 2020.

“Adventist’s current enterprise resource planning system was outdated, very customized and required a significant amount of maintenance — and that was really the theme across many of their legacy systems,” says Jerry Jorgensen, master principal solution engineer, Oracle Healthcare. “The act of consolidation and reporting was a major headache, often taking days. It t ook a large team just to gather the data required for the reporting.”

Meanwhile, understanding the health system’s true cost of care “was nearly impossible with their legacy system,” says Jorgensen. “They were struggling with access to clinical data and needed the flexibility to leverage and customize methodologies based on the system’s unique needs.”

Leaders knew that the ability to achieve aggressive growth goals would require the system to move beyond disjointed systems that lacked the capacity to operate at increased scale. Adventist partnered with Oracle to implement a single, cloud-based system for human resources (HR), finance, supply chain and enterprise performance management.

“It was important for Adventist to have a common user interface and platform for reporting,” Jorgensen says. “That way, users wouldn’t have to learn different reporting tools or engage vendors to access HR, finance, budgeting or costing data. Instead, they could go to one place and access all the information they need.”

The solution Adventist implemented has a “chart of accounts” hierarchy — from human capital management to finance, supply chain management and enterprise performance management. The ability to pull information from a variety of dimensions in a single place. It’s an approach that not only has greatly reduced maintenance costs, but also ensures that no matter where team members pull data, they get the same answer. New acquisitions are folded into the system quickly. In fact, “We have the ability to report on an acquisition’s performance even before they have transitioned into the organization,” says Jorgensen.

The finance capabilities of the new system have enabled Adventist to consolidate data and report on performance in real time. The result: Adventist’s budget timeline has been cut in half, from six months to three months. Today, the health system’s transition to the cloud continues, with new capabilities being explored, including rolling forecasting.

Using digital engagement to reduce healthcare costs

Connecting consumers with an optimal patient financial experience is critical not just to retaining patients, but also encouraging patients to pay for their out-of-pocket costs of care. At RevSpring, experiences with three hospitals and health systems demonstrate the results healthcare organizations can achieve when they strengthen digital engagement for patient financial services.

Research shows patients are ready to be engaged digitally — including around payment — yet providers have been slow to respond. According to RevSpring patient-
experience surveys:

  • 59% of providers have digital information on patients that they do not use for billing
  • 69% of patients aren’t given digital billing options at the time of service
  • 62% of patients want digital-only communications or a combination of digital and print communications

The key, says Kristen Jacobsen, vice president, omnichannel solutions for RevSpring, is providing digital-first — but not digital-only — engagement. “When patients are engaged digitally, they are 21% more likely to pay their bill, and they pay seven days faster, on average,” she says. “We’ve found that 64% of patients who receive a text informing them of their out-of-pocket costs pay their bill on the day a text is received. Organizations experience an 8% increase in payments made in full and an 85% lift in self-service patients.”

Consider the experiences of these hospitals and health systems:

  • A nationally recognized, not-for-profit health system in the Midwest that faced challenges with a fragmented patient experience developed an online portal that enables patients to pay their bills in two clicks. The system also worked to provide a consistent patient financial experience across its hospitals and care centers. The impact: a 44% higher payment rate through digital self-service options, with a $7.9 million increase in payments and an uptick in payments made in full.
  • An East Coast hospital featured on the U.S. News & World Report’s “2019-20 Best Hospitals Honor Roll” sought to provide a more modern, seamless online billing and digital patient engagement approach. The hospital redesigned its financial engagement process to promote digital-first communications, with QR codes and unique messaging that drives patients to pay online. The hospital also expanded mobile engagement to reach a larger patient population. The impact: 24% of patients make a payment within the first hour of receiving a text, and 40% do so the same day.
  • A Midwest hospital on the U.S. News & World Report’s “2019-20 Best Hospitals Honor Roll” sought to increase response rates to patient financial communications through messaging and digital channels. The hospital worked to enroll more patients in its online portal and developed targeted messaging to convert patients to digital options based on historical, financial and behavioral characteristics. The result: Patient payments increased by 20%, with a $2.35 million increase in revenue. Paperless enrollment increased by 25% and payment plan participation rose 38%.

“Now is really the time to strengthen digital financial engagement in healthcare,” Jacobsen says. 

This published piece is provided solely for informational purposes. HFMA does not endorse the published material or warrant or guarantee its accuracy. The statements and opinions by participants are those of the participants and not those of HFMA. References to commercial manufacturers, vendors, products, or services that may appear do not constitute endorsements by HFMA.

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