"The revenue-cycle segment is very expensive," said Timothy Kinney, a managing director at Navigant. "It requires the right planning, implementation and training, and if you are not making those moves up front, the average organization comes out similar to where it started."
Streamlining scheduling, payment processing and debt collection has often been one of the first areas hospital executives address as they aim to cut costs and increase revenue. Improving revenue-cycle management can have a quicker return on investment than reducing care variation or limiting unnecessary treatment.
Within the revenue-cycle space, most executives are focused on improving revenue integrity at 24%, according to the survey. That's followed by boosting EHR optimization at 21%, physician and clinical documentation at 12%, and self-pay management at 11%.
"Providers must take advantage of opportunities to more holistically educate patients on out-of-pocket costs, predict their propensity to pay as early as possible and secure alternative payers or financing when needed," said James McHugh, a managing director at Navigant.
Many health systems have turned to automation to help them collect outstanding debts faster and minimize staff workload.
"The industry is going toward more automation and taking the human touch out of it," Kinney said. "This can help them work smarter and repurpose resources."
Sixty-eight percent of executives surveyed said their revenue cycle technology budgets will increase over the next year, down from 74% last year. Notably, 39% fewer executives project a budget increase of at least 5%. Meanwhile, 81% of executives believe the increase in consumer responsibility for costs will continue to affect their organizations, down from 92%.
A growing number of providers have opted to outsource parts or all of their revenue-cycle management operations, which could save them money and allow them to focus on care delivery rather than administrative tasks.
As patients become more cost-conscious consumers, providers often realize there are gaps in their customer service and technical proficiency in billing matters, experts said. Cost pressures related to softening admissions and growing bad debt loads have also led hospitals and health systems to outsourcing.
But for those that keep the services in-house, they have a major opportunity to improve revenue-cycle management as they roll out new EHRs, Kinney said.
Progressive providers are combining professional and hospital billing in a more detailed format, implementing mobile platforms for payment plans, working with consumers to understand the hang-ups and their needs, and automating processes where possible, he said.
"For those that do it right, they can increase net revenue 2% to 4% a year through this optimization effort," Kinney said.
