Augmenting the Revenue Cycle Operation in a Post-COVID World
By Terry Blessing
The COVID-19 pandemic caused an already turbulent health care revenue cycle management (RCM) environment to descend into chaos virtually overnight.
Faced with a sharp drop in revenue from the reduction or cancellation of profitable services such as elective surgeries, along with a surge in demand for COVID-related clinical help, many hospitals, physician offices, and other health care organizations reduced their RCM staffs. This meant fewer people generating invoices, following up on delinquent accounts, responding to denials, and performing many other tasks required to keep health care organizations financially stable.
Fortunately, the growing percentage of Americans receiving COVID-19 vaccines has the country steadily moving toward herd immunity and a return to some level of normality by the end of 2021. For providers, this means they soon will be able to again offer a full range of revenue-generating services.
But given the loss of RCM staff during the pandemic, how can hospitals, physician practices, and other health care organizations that have fallen far behind in many RCM activities catch up? The pending return to “normal” provides health care organizations with an opportunity to reassess and even reinvent how their RCM departments operate.
Previous RCM staff reductions offer providers greater flexibility in choosing among alternate RCM operating models. Indeed, resuming business as usual simply by hiring people to perform vital revenue cycle activities no longer may make sense for some health care organizations.
One partial solution health care organizations can pursue is to adopt robot process automation (RPA). Much of the RCM work even in otherwise technologically advanced health care organizations has traditionally been performed by humans. Humans, however, can only process so much work and need time off. They also make mistakes and must be retrained whenever tools or processes change.
RPA systems eliminate those human-related complications. Not only can they run perpetually—bots don’t need breaks, sick leave, vacation, or benefits—they don’t make data entry errors. And when things such as reimbursement schedules or codes change, the entire system can be updated as soon as the new information is available.
How an RCM Outsourcing Partner Can Help
A word of caution, however. RPA systems are a partial solution. Health care organizations still need humans both to oversee the technology and manage exceptions. Rather than hiring more full-time RCM employees, hospitals and physician practices should consider an outsourced partner to augment internal staff.
An RCM services partner can help improve a health care organization’s revenue operation in several ways. For example, point of service collections are a big problem for some health care organizations because many physicians and registration staff find it difficult to ask patients for money up front. Some won’t even do it. As a result, these providers are less likely to be paid in full for their services. Outsourcing point-of-service collections to an RCM partner with the proper training and skills can boost a provider’s collection success rate, enabling it to capture more owed revenue.
Another way an RCM services provider can help health care organizations stabilize receivables is through reducing denials. Claims can be denied for a number of reasons, including coding issues and violations of Centers for Medicare & Medicaid Services (CMS) guidelines. The latter in particular can be challenging to navigate for an office assistant who may not even be a billing specialist. Reimbursement rates and rules are constantly changing, and no one is sure whether or when the dollars CMS put forth to help hospitals and other providers deliver care to COVID-19 patients will be reduced or eliminated. Handing over denials management to a well-trained and well-informed liaison can reduce denial rates.
Getting the bill out the door is an obvious step toward reducing days in accounts receivable, a key revenue cycle metric. Needless to say, you won’t get paid if you don’t submit a bill. This is another function for which an RCM partner can pick up the slack for health care organizations.
Cybersecurity also can impact a health care organization’s financial standing. If hackers break into a health care organization’s network and steal patient information, stiff HIPAA penalties and other costs are a possibility. Data from IBM Security’s 2020 Cost of a Data Breach Report show health care organizations paid an average of $7.13 million per breach, up 10% from the previous year. While smart technologies such as artificial intelligence and analytics can cut the costs of breaches in half, the report says, less than 1 in 4 (23%) of health care organizations use security automation solutions. An RCM partner may offer extra protection for HIPAA-related information, reducing a health care organization’s financial exposure.
As the postpandemic world opens up, the volume of RCM activities likely will outpace the resources available to manage them. This will increase pressure on health care organizations to stabilize and optimize their revenue cycle activities to take full advantage of the upswing in business and recover as much outstanding revenue as possible. Experienced RCM service providers are an excellent alternative to hiring full-time RCM staff, especially in an economic environment where flexibility and scalability are crucial to survival.
— Terry Blessing is senior vice president of client development for VisiQuate.