With the majority of hospitals and health systems struggling to achieve the full potential of their electronic health systems (EHR), many organizations are turning to outsource companies and other vendors to improve revenue cycle performance, a new survey shows.
More than 60% of healthcare executives believe the challenges associated with EHR revenue cycle management (RCM) outweighed the benefits, according to analysis conducted by Navigant based on a survey done by the Healthcare Financial Management Association (HFMA). A total of 108 hospital and health system chief financial officers and revenue cycle executives responded to the survey.
The survey underscores providers’ ongoing disappointment with EHR performance and the actions they’re taking to overcome those shortcomings. Historically, EHR solutions have frequently failed to deliver key RCM capabilities.
For example, most systems typically do not integrate with practice management systems to facilitate effective charge capture. Ineffective charge capture can result in a significant amount of money being left on the table due to under-coding, or an increased compliance risk because of over-coding.
“It was anticipated that EHRs would be the main driver of broad performance improvement, but that has not occurred in many cases,” said Timothy Kinney, managing director of Navigant.
“Instead, providers are now taking other steps, including looking outside their organizations to collaborate with external entities and leveraging advanced technology solutions, and they’re seeing successes.”
According to the survey, 46% of respondents said they were collaborating with external organizations, including outsourcing and vendor partnerships, to decrease revenue cycle costs and increase economies of scale. At the same time, the survey also found that spending for staff training, business intelligence/analytics and coding all declined in 2019.
So, what does this mean for providers?
With less money being spent for training and analytics, providers must look to establish new alliances with partners that can deliver the cost-effective expertise needed to supplement a health system’s revenue cycle management resources.
Areas where outside partners can provide additional value include:
- Creation of a market-based pricing strategy
For hospitals and health systems, a solid financial footing begins with the development of a comprehensive, market-based pricing strategy built around cost, reimbursement and peer pricing data. Most hospitals don’t have the resources to conduct in-depth competitive pricing analysis. ParaRev has the expertise to create a detailed and empirically based pricing model to ensure you’re aligned with peer group averages and simultaneously positioned to capitalize on opportunities for maximizing returns on below-market-priced items and services.
- Implementation of a revenue integrity program
It’s vital that hospitals and healthcare systems ensure critical elements of the revenue cycle – coding, charge capture and claims management – are executed correctly and consistently. Charge master reviews can uncover where you may be either losing reimbursement or be at risk for compliance issues. On-site audits by an external partner can help spot opportunities for increased reimbursement, improved charge accuracy, more effective compliance and denial reductions. A retrospective claims analysis will compare the claim against the supporting documentation and target inconsistencies that can lead to reduced reimbursement.
- Accounts Receivable (AR) recovery and resolution
Hospitals often don’t have the resources to work aged and/or small balance claims to recover everything they are owed from insurance claims that otherwise would have been written off. While the administrative costs of reworking denials approach $9 billion annually, only about 35% of payer rejections are ever reworked and resubmitted. Partnering with a qualified third-party vendor that possesses the technology and expertise required to help hospitals isolate, identify and remediate issues that result in unresolved claims can drastically improve margins and increase cash.
- Robotic Process automation (RPA)
Significantly, the HFMA survey found that 15% of health system executives said their organizations are now targeting RPA to improve revenue cycle management. That’s up from zero in 2018. “New technologies leveraging RPA, artificial intelligence, and machine learning have unlocked significant opportunities to reach previously unattainable levels of revenue cycle performance,” said Kent Ritter, director with Navigant.Vendors that have already implemented RPA as well as intelligent automation can provide a more robust and powerful process for quickly and more effectively handing outstanding AR.
ParaRev can help
Armed with this data, ParaRev pricing experts work alongside the hospital’s financial management team to establish specific pricing targets and timelines based on the opportunities presented. These calculations will also take into account contractual reimbursement rates to ensure the new prices are consistent with payer policies.
Likewise, ParaRev can help develop effective strategies for areas or services that require pricing sensitivity. For example, an organization may want to keep prices at, near or even below cost for some services to remain competitive with independent, free-standing facilities.
Importantly, the pricing developed through ParaRev’s rational pricing model is competitive with peer pricing and therefore both defensible and supportive of an effective consumer-facing transparency strategy.
A comprehensive solution
ParaRev understands the pressures hospitals face today and the tools providers need to respond effectively. That’s why we’ve assembled a sophisticated array of services and technologies, including robotic process automation (RPA), that collectively deliver the capabilities your revenue cycle needs to flourish in the current marketplace.
From optimized pricing through peer analysis to comprehensive revenue cycle performance audits and technology-driven denial management and recovery, ParaRev’s services – whether accessed ala carte or as a single solution – give you the ability to perfect pricing strategies while ensuring the highest level of revenue cycle performance.
For example, ParaRev’s scalable, client-specific accounts receivable resolution and recovery solutions allow hospitals to systematically address problem claims across the full AR spectrum. Through our proprietary, intelligent automation and powerful process engineering, we’re able to resolve all claims, regardless of size or age.
Utilization of our software, the PARA Data Editor (PDE) will also provide an automated claim audit tool to identify charge capture problems, such as observation cases billed without evaluation and management (E&M) codes or chemotherapy administration charges that don’t include chemotherapy drugs on the same claim.
Meeting the challenges of hospital pricing and revenue cycle management requires systematic approaches grounded in empirical evidence and a capable staff implementing proven solutions.
ParaRev’s suite of services can help you significantly refine your pricing, coding, AR recovery and resolution, and denial management processes. The result is improved revenue capture and better margins. Contact us today to learn more about how we can help your organization accelerate its financial transformation.
- “EHRs, Consumer Self-Pay Remain Providers’ Top Revenue Cycle Challenges,” 2019 Navigant/HFMA Revenue Cycle Trends Survey, Sept. 25, 2019.
- Jacqueline LaPointe, “Hospitals Looking Beyond EHR to Improve Revenue Cycle Performance,” RevCycle Intelligence, Sept. 25, 2019.
- “Revenue Cycle Technology Trends,” Navigant/HFMA, September 2019.
- Philip Betbeze, “Claims Appeals Cost Hospitals Up to $8.6B Annually,” HealthLeaders, June 26, 2017.
- Chris Wyatt, “Optimizing the Revenue Cycle Requires a Financially Integrated Network,” HFMA, July 7, 2015.
- “EHRs, Consumer Self-Pay Remain Providers’ Top Revenue Cycle Challenges,” 019 Navigant/HFMA Revenue Cycle Trends Survey, Sept. 25, 2019.
- “Revenue Cycle Technology Trends,” Navigant/HFMA, September 2019.
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