Revenue cycle leaders should work to lighten the load for back-office staff immediately, experts say.
Maintaining the revenue cycle operations of an organization comes with a unique set of challenges. Labor shortages in particular have been plaguing the healthcare industry for years, forcing revenue cycle leaders to reevaluate the way they remedy staff burnout and responsibility.
In fact, Surgeon General Vivek Murthy, MD, issued an advisory on building a thriving healthcare workforce that included ways organizations can help revenue cycle staff avoid burnout, including reexamining time spent on prior authorizations, optimizing back-end technology, and more.
Inefficient work processes, burdensome documentation requirements, and limited autonomy can result in negative patient outcomes, a loss of meaning at work, and health worker burnout, the advisory said.
These combined challenges are putting pressure on revenue cycle leaders, and now is the time to act, especially when it comes to back-end revenue cycle operations, says Titus Leo, SVP and head of healthcare provider practice at Sagility.
"The recently issued advisory shows how the healthcare labor crunch has had a serious impact on both frontline workers and back-office provider operations," Leo said.
And, he says, if health systems don't address revenue cycle staffing challenges per the Surgeon General's guidance, cash flow and revenue will suffer, and this at a time when providers struggle to make progress toward financial recovery from the pandemic.
To help alleviate the burden on back-office staff, Leo says health providers should employ the following strategies, supported in part by technology:
Automateback-office functions to create efficiencies. As hospital volumes fluctuate and administrative labor resources may be scarce, automation fills the gaps and takes over repetitive, manual processes, Leo says.
Apply analytics to the revenue cycle workflow to use staff more effectively. For example, Leo says collecting low-balance accounts through manual processes often provides little return. By applying analytics to assess likelihood of payment, providers can allocate staff resources to follow up on accounts most likely to be paid.
Consider staff augmentation to fill labor gaps. With labor shortages plaguing the healthcare industry, revenue cycle talent is increasingly hard to come by, Leo says. External business process management experts can provide scalable staff and expertise to mitigate worker burnout and offset talent gaps as volumes fluctuate.
"Utilizing these strategies in conjunction with the latest technology can enhance revenue cycle staff capabilities, ultimately helping to better serve the needs of workers and reduce burnout," Leo says.
Todd Mallon, CFO of Advocare, says the organization has a near-perfect net collection ratio.
Improving net collection rates and overall revenue cycle management processes is top of mind for revenue cycle leaders and adding in new solutions and automation to streamline those operations has been a must for many organizations.
Todd Mallon, CFO of Advocare, one of Pennsylvania and New Jersey's largest independently physician-owned and physician–governed multi-specialty medical organizations, recently spoke with HealthLeaders about implementing new technology to streamline the health system's revenue cycle management operations.
With over 650 providers and 3,000 staff across over 150 independent care centers that facilitate roughly two million patient visits annually, Mallon said it was essential to simplify its revenue cycle.
Since implementing new technology from eClinicalWorks to help with its revenue cycle management operations, Advocare now has a 99% net collection ratio. As the industry standard ratio for net collections is 95%, Advocare is now operating well above average and experiencing the positive effects of that change across all of its care centers.
"I spend much less time discussing processes and denials with our accounts receivable teams. We now have the space and flexibility to focus on expanding our operations and meeting the needs of more patients in our community," Mallon says.
HealthLeaders: What sort of problems were you seeing in your revenue cycle that made you realize you needed to implement a change? What was your main driver?
Todd Mallon: Our net collection ratio was the strongest indicator that we needed to change our revenue cycle management solution. The net collection ratio measures how effectively our practice collects reimbursement for services from patients and payers. This metric has always been a top identifier of financial success in healthcare organizations.
However, our net collection ratio was continuously dropping with our previous practice management system. I felt like I spent most of my time at every financial review meeting discussing accounts receivable, denials, and current processes to get to the core of this issue. This meant our teams were spending most of their time fixing the day-to-day operations, which limited our ability to grow and provide high-quality care to more patients. So, our main driver for changing our revenue cycle management was to equip our finance and accounts receivable teams with the support and resources they needed to improve our net collection ratio.
HealthLeaders: What was the process of implementing new technology, and who was involved with the decision-making at your organization?
Mallon: Everyone on our leadership team supported the decision-making process. Between our CEO—who provides a medical perspective, the admin team and myself—who provide the financial and operational perspective, and our task force—comprised of multiple physician leaders across all of our specialties, we wanted all stakeholders represented in the decision-making process.
Leading up to the implementation, we had several meetings with our vendor to define specific goals, metrics, and deliverables to improve our net collection ratio. Once we aligned on the basic workflow and back-end operations, the next step was training. The system was new for everyone—from our CEO to the providers to the management staff—so we needed a lot of support to train our people. Without proper training, we were unlikely to see our net collection ratio improve.
Before the launch, a select group of our staff went to Boston for a complete overview and training of the new system. Three months before the launch, our vendor's team trained our providers so they would feel confident with the system. We also provided pre-launch training courses to the rest of our staff. However, even after the training, the team was available for a quick phone call or chat to answer questions or troubleshoot a potential issue with the system or workflow.
HealthLeaders: How long did it take for your organization to fully implement the technology, and how did implementation work since your practice spans so many clinics?
Mallon: Launching the system was challenging, and we could not have implemented the technology smoothly without the vendor's support. We rolled out the new solution across all 150 health centers in one day. We went all in from the beginning, and we needed to start strong.
We had eClinicalWorks trainers at every care center for about a week to two weeks after the launch to help with the transition process and to train additional Advocare staff. During the implementation, we trained internal staff as point people for the solution so they could carry on with further implementation and staff training.
HealthLeaders: Since implementation, what positive outcomes have you noticed?
Mallon: The most noticeable positive outcome is our increased net collection ratio. Several things contributed to this increase.
First, we now have a dedicated eClinicalWorks team that handles our day-to-day collections and follow-ups to ensure we receive claims on time. To create an efficient workflow, the team helped us set up ready-to-bill rules to ensure care centers complete reports accurately. We can create alerts for missing information or incomplete claims. In addition to these in-workflow rules, the team notifies us of any issues, which gives us plenty of time to gather additional information from providers or communicate the next steps with payers.
Second, our vendor's team also handles denial appeals for our care centers. So, if a denial comes back for a claim from a specific center that needs to be addressed or changed, they will help that center submit an appeal and track the claim progress within our system. Once we receive payments, they handle the cash collections and posts them internally so we can keep track of our revenue in real time.
HealthLeaders: What are some keys to success you could share with another organization looking to do the same for their facility?
Mallon: The first key to success I'd share with other organizations looking to improve their revenue cycle is to know where you currently stand. Know your net collection ratio and how many days your accounts receivable is outstanding. Once you have a baseline, you can set goals and implement strategies to improve workflows and increase collections. And once you have these measurements, keep track of them and update them regularly. We have regular meetings with our team to discuss our current metrics, compare them to our revenue and collections goals, and adjust our workflow and operations as needed. Everything needs to be measurable to be successful, especially in revenue cycle.
Second, train your team on the new technology. Especially for multi-site healthcare operations, it is imperative to have people at each care center who can monitor the solution’s success and train new staff as needed. Now each care center runs at its best. It is also easier to open new care centers because we have a unified system.
Finally, choose a health IT vendor that listens to and learns from your organization. Open communication between a health IT vendor and a practice customer can benefit both parties. For example, based on our experience with their technology and conversations between our staff and the eClinicalWorks team, they came up with a mass lock button that would lock multiple charts at once to minimize clicks and improve billing efficiency. The most valuable part of our partnerships is open communication. We are willing to learn from them, and they are willing to learn from us. Because of this open communication, our providers and staff leverage more efficient workflows and our net collections increased. Through them, we are also exposed to new opportunities to improve health IT solutions.
In the end, patients get a better experience, and everyone wins.
Automating certain revenue cycle operations could lower health systems' cost-to-collect.
Healthcare leaders who use automation within the revenue cycle reported having an average cost-to-collect of 3.51% compared to 3.74% for those who don't leverage automation. This is according to a recent survey from AKASA that features responses from 556 chief financial officers and revenue cycle leaders at hospitals and health systems across the country.
That .25% difference could potentially save hospitals and health systems millions of dollars.
For example, according to the survey, if a health system has $5 billion in revenue, a cost-to-collect of 3.74 percent without using automation would equal $187 million. If the same health system automated its revenue cycle operations and had a cost-to-collect of 3.51 percent, it would amount to $175.5 million.
This signifies $11.5 million in savings from automating revenue cycle operations.
"Automation is the key differentiator when moving the needle on cost-to-collect and creating large-scale cost savings," Amy Raymond, vice president of revenue cycle operations at AKASA, said in a press release.
"Although healthcare revenue cycle leaders have been trying to reduce the rates for years, studies show cost-to-collect has remained stagnant and this collides with significant financial pressures facing most healthcare organizations," Raymond said.
In fact, those financial struggles were highlighted in the latest National Hospital Flash Report from Kaufman Hall. From June and July of this year, hospitals’ financial performance plunged, following months of improvements, due to declining outpatient revenue, expensive inpatient stays, and decreasing operating room time, the report said.
Hospitals and health systems are experiencing some of the worst margins since the beginning of the COVID-19 pandemic, putting 2022 on track to become the worst financial year for the healthcare sector since the crisis first started.
Several federal agencies issued a set of final rules based on the No Surprises Act aimed at making it easier for providers to contest payer decisions.
A new No Surprises Act final rule and additional guidanceto further implement the independent dispute resolution (IDR) process and require payers to provide additional information to providers about qualifying payment amounts (QPA) was recently released by CMS and other federal agencies.
During the IDR process, an arbiter is directed to consider all information submitted by the physician and insurer, including the median in-network rate, complexity of the case, previously contracted rates, and market power of the physician and insurance company, among other items.
The law states that the QPA could be one of many equally weighted factors considered in payment disputes.
However, until a recent court ruling, the rule made the QPA the primary factor in the IDR process. Organizations have said that since the QPA is "an unverified rate set by insurers," and using it to settle disputes "sets an artificially low benchmark payment, for all care—whether in network or not, which may not support wider access to care—particularly in underserved areas."
In the new rules, CMS references the court decision, saying it will "remove the provisions that the District Court vacated." Now IDR entities may weigh QPA and other factors equally in making their decisions.
This is not a full reversal for the QPA's role, though, according to Part B News.
David McLean, a partner with Hall Booth Smith PC in Atlanta told Part B News that "although the final rules do not require the certified IDR entity to select the offer closest to the QPA, the Departments remain of the opinion that it will often be the case that the QPA represents an appropriate out-of-network rate."
However, there is a win for providers when it comes to downcoded claims.
A major plus for providers is the agencies’ decision to require payers to include both an original and an altered QPA for the claim if the payer has downcoded it by switching a code so that the claim is reimbursed at a lower rate.
Now, the payer must not only admit and describe the downcoding but also explain its reasoning, this will then be considered among the factors in the IDR decision. The new rule should help some downcoded providers on price, but it will also create extra work from the IDR entities, Part B News reported.
Extra work is not ideal for IDR entities.
In fact, a recent IDR process status update showed that between April 15 and August 11, the federal IDR portal has received over 46,000 claims, "which is substantially more than the Departments initially estimated would be submitted for a full year." According to the status update, only 1,200 of those claims have received a payment determination.
Clarification on other important No Surprises Act regulations were not covered in these rules, such good faith estimates, but more guidance is expected in the coming months.
The departments of the Treasury, Labor, and Health and Human Services released a request for information regarding the No Surprises Act.
The departments recently released a lengthy request for information for revenue cycle leaders to inform future rulemaking to implement advanced explanation of benefits (AEOB) and good faith estimate (GFE) requirements under the No Surprises Act.
The request asks commenters to share their expertise on a range of issues and even poses specific questions to help inform the development of future regulations. Some of these questions include:
What issues should the departments and office of personnel management (OPM) consider as they weigh policies to encourage the use of a fast healthcare interoperability resources-based application programming interfaces (API) for the real-time exchange of AEOB and GFE data?
What privacy concerns does the transfer of AEOB and GFE data raise, considering these transfers would list the individual’s scheduled (or requested) item or service, including the expected billing and diagnostic codes for that item or service?
How could updates to this program support the ability of providers to exchange GFE information with plans, issuers, and carriers or support alignment between the exchange of GFE information and the other processes providers may engage in involving the exchange of clinical and administrative data, such as electronic prior authorization?
What, if any, burdens or barriers would be encountered by small, rural, or other providers, facilities, plans, issuers, and carriers in complying with industry-wide standards-based API technology requirements for the exchange of AEOB and GFE data?
Comments are due in 60 days and electronic comments on this regulation can be submitted on its website.
Sarah Hartwig, patient access officer at Avera Health, discusses how the organization is improving reimbursement and advancing the patient experience through automation.
The complexity of medical reimbursement not only creates a poor patient financial experience, but it also drives up hidden costs for organizations.
Automating certain processes within the revenue cycle can protect patients from surprise medical bills and allow staff to spend more time on meaningful work to improve the patient financial experience, but it’s not a one-size-fits-all endeavor.
Avera Health, an integrated health system based in Sioux Falls, South Dakota, serves patients through 37 hospitals, 215 primary and specialty care clinics, 40 senior living facilities, sports and wellness facilities, and more. In order to improve its revenue cycle processes across its complex system and create a positive patient financial experience, Avera Health realized automation was key.
The patient access officer at Avera Health, Sarah Hartwig MBA, MSHS, focuses on front-end revenue cycle operations and recently shared with HealthLeaders her experience in helping to implement automation solutions in this area of the revenue cycle.
HealthLeaders: Why has automation been essential to your organizations’ revenue cycle?
Hartwig: I think we all know that medical reimbursement is complex. When I started out in healthcare, we would talk about what a dynamic environment it is, and that was 20 years ago. And here we are now—even more dynamic and more complex.
Because of the complexity—from government regulations to payer expectations—it really makes automation even more important and integral to the holistic view of our strategies and revenue cycle. Automation also helps us better leverage our human resources. If we can offload those redundant and elementary tasks, it actually helps make those human efforts more meaningful.
We've noticed the need to unify that approach in the middle and back-end workflows, too. And that automation continuum allows us to have that perspective.
HL: What are key factors organizations should consider in selecting and implementing technology solutions for the revenue cycle?
Hartwig: For us, it's been about maintaining a focus on the patient. During the pandemic, we had to quickly change and shift to adopt new ways and new strategies of doing our work.
But, as we take more of a long-term focus, it really is about maintaining that focus on the patient while considering the needs of multiple stakeholders.
Another factor is interoperability. There are so many potential solutions out there. What we've found is that you need to focus on the core solution for your revenue cycle, build off of that, and then put the focus on interoperability so that it works in the day-to-day. Creating that interoperability will only better reimbursement and the patient experience.
Another consideration for us, again, is evaluating the long-term automation goals.
We feel pretty reactive after dealing with a lot of the changes in the past couple of years. It feels like we've had to quickly change and move. Now that we can breathe a little more, we can take a step back and really look at our long-term goals for these solutions, all while keeping the patient at the center.
One of our long-term goals is maintaining transparency. So, anytime we're selecting a tool for automation, we like to consider what information the patient, care team, and folks supporting the backend process will all see through this tool. This is important to us because we want to make sure there's a level of transparency for everyone.
Also, any automation tool that we're looking for, for example if we're truly leveraging the patient to self-serve, our team needs to consider building quality factors so that it doesn't take any type of rework from our revenue cycle staff.
And lastly, I'll just mention the vendor selection process. For us it is more about building partnerships. I'm building relationships and working more holistically with those partnerships that will take us to and through the long-term solutions that we are looking for.
HL: What are some of the broader trends that have driven adoptions of automation solutions?
Hartwig: We know hospital costs are increasing and reimbursement is not necessarily improving, so our margins are thinning. That’s why it’s so important that adoption of technology truly leverages and positively impacts our costs for operation.
For us, we continue to shift the focus from back-end workflows and try to alleviate and prevent some of those time-consuming tasks (like collections) by utilizing the front end of the revenue cycle. Automation in the front end is much more of a focus for us as it can prevent those errors that would burden the back-end staff.
We are also working to identify potential prior authorization and medical necessity denials early on in order to make sure those prevention factors are put in place. That has also led to more conversations and more inclusion of our care teams. I'm working to automate all of those financial clearance processes upfront so that we're engaging with patients immediately, so they know their out-of-pocket costs and what to expect moving forward. All of these factors will create a positive patient experience and have a positive impact on our bottom line.
Industry experts share advice for revenue cycle leaders on battling denials including closing gaps in the middle revenue cycle and understanding payer criteria.
Health systems have made avoiding and managing denials a top priority, but for many, their best efforts have yet to turn the tide. The quest to get ahead of denials and protect revenue has gained urgency as hospitals continue to cope with the financial impact of the COVID-19 pandemic.
In fact, hospitals and health systems are experiencing some of the worst margins since the beginning of the COVID-19 pandemic, putting 2022 on track to become the worst financial year for the healthcare sector since the crisis first started.
With budget cuts and staffing shortages putting pressure on revenue cycle leaders, denial management solutions can feel out of reach. But with knowledge, data analytics, and an organized strategy, organizations can address issues at their root and reduce denials.
The average rate of denials rose 23% from 2016 to 2020, according to a 2021 Change Healthcare report. Even after the onset of the pandemic, denials continued to rise—particularly in areas hardest hit by the first wave. Yet 86% of denials are avoidable, according to the report.
As previously reported by HealthLeaders, the denials rate has been steadily increasing of the last few years, and for one-third of hospitals, their average denials rate was more than 10%.
At the time of that study, the average national denials rate was between 6% and 13%, but many organizations were nearing what Harmony Healthcare called the denials "danger zone" of 10% of higher.
According to that survey, 33% of hospital executives reported average denial rates of more than 10% and 32% of respondents reported their top concern as coding.
In addition, pandemic-related changes in rules and staffing added fuel to the fire.
The rise in denials isn't surprising given the increasing complexity of reimbursement rules, Monica DuBois, RHIA, vice president of coding solution technology at DeliverHealth in Atlanta told HIMB.
"Everything blew up in 2020," DuBois says. "There were so many changing rules, and now we're just starting to see some of those denials come through."
So, what are some of the biggest denial pain points?
Experts agree that most of the current denial targets feature familiar coding diagnoses: sepsis, malnutrition, acute kidney injury, acute tubular necrosis, and respiratory diagnoses. Most of these diagnoses are based on clinical criteria, and there may be differences in the criteria used by providers, payers, and third-party auditors, Melissa Rodriguez, CCDS, CDIP, CCS, CCS-P, CHRI, CPMA, manager of clinical denial solutions at Enjoin told HIMB.
Payers are taking a harder look at any claim with a respiratory, sepsis, or COVID-19-related diagnosis. More than 25% of audits are related to these diagnoses, according to Dawn Crump, MA, SSBB, CHC, senior consultant for revenue cycle solutions with MRO Solutions in Norristown, Pennsylvania.
Working with your CDI and coding directors to educate staff and provide more education around these diagnoses will only improve an organizations reimbursement rate.
Also, organizations should still be keeping a close eye on COVID-19 denials, particularly from commercial payers.
Commercial payers might have specific coding guidance, for example, that differs from CMS'. If an organization doesn't take that into account and coders aren't trained on these payers' rules, denials will start to rack up, DuBois says.
Looking outside of the revenue cycle silo is important to maintaining a well-rounded department, so take a look at three recent stories pertaining the revenue cycle from other healthcare leaders.
3 ways CFOs are containing staffing costs while investing in the future
CFOs are getting creative when it comes to retaining talent, succession planning, and maintaining the overall financial health of their organizations.
"A number of repetitive tasks have been automated and that has created the need for a new technical workforce to manage that work," says Michele Cusack, SVP and CFO at Northwell Health in New Hyde Park, New York. "Our largest area of success with RPA has been in revenue cycle, but we're trying to replicate the success in other functional areas as well using various technology platforms to further optimize workflow and putting tools in place to mitigate the need for manual work efforts."
New technology, strategies improve occupational health management
Health systems are using digital health tools and the electronic health record (EHR) to not only monitor staff health and track compliance but give employees an avenue to manage their wellness and connect with supervisors.
Atrium Health Wake Forest Baptist, based in Winston-Salem, NC, is running its occupational health program through a custom-built electronic health platform developed through a partnership with Enterprise Health. The platform gives administrators insight into employee compliance and engagement rates, while streamlining the communication process and allowing interactions through mobile devices and an online portal.
"This was something that was definitely manual before," says Samantha Lodish, the health system's administrative director. "Now we're able to manage the healthcare of all our employees through the EHR. We definitely needed this and are thankful we have it."
TriHealth partnered with a third-party vendor that helps deliver value-based care services, and as a result, the health system achieved notable clinical and financial outcomes across a variety of payer contracts. TriHealth saw a change in revenue with a 70% rise in ambulatory settings and 30% in acute settings.
The health system also grew its primary care access by 25% across more than 230 primary care physicians and advanced practitioners. TriHealth says it now ranks near the top decile in cost and utilization as the top-performing ACO nationwide. with a larger payer—$7 million-plus in shared savings.
CMS is receiving pushback on its plan to create three new prolonged services codes.
Healthcare stakeholders, ranging from specialty societies to individual coding consultants, have urged CMS to abandon its plan to create three new prolonged services codes in commentssubmitted in response to the proposed 2023 Medicare physician fee schedule (MPFS).
Industry stakeholders described the three-code proposal for prolonged services as disappointing, burdensome, and confusing, according toPart B News.
For example, the American Association of Oral and Maxillofacial Surgeons said it was disappointed that CMS did not intend to accept the CPT® coding update to prolonged services and expressed concerns that two coding systems "will create administrative burden and undue confusion on the part of healthcare providers and coders."
The American Academy of Neurology predicted CMS’ proposed policy will "lead to confusion among practitioners and prove to be disruptive when medical specialty societies educate members about the correct coding for prolonged service."
Both specialty societies urged CMS and the workgroup to come to an agreement on how to define prolonged services for their revenue cycle.
According to Part B News, one commenter, a self-described professional billing consultant from Ohio, said the plan "makes no sense" and noted that it would not simplify coding. "If you are seeking 'administrative simplicity,' you should work it out with CPT and agree. The two of you having completely different numbers for the same [services] is going to be extremely confusing, " the commenter said.
CMS' original plan to use time to determine whether the treating physician or qualified health care professional (QHP) performed the substantive potion of a split/shared visit isn’t picking up any fans, based on a review of posted comments, Part B News said.
In the final 2022 MPFS rule, CMS said that it would allow practices to determine the substantive portion of the visit based on time or performance of key components for one year to allow providers to get used to the new policy. In the 2023 proposed rule, the agency announced plans to extend its policy another year.
However, the comments indicate that stakeholders want the option to bill based on time or key components—time or medical decision-making after 2022—to be permanent.
These aren't the first groups to urge changes of the rule.
Both the Medical Group Management Association and the American Hospital Association submitted comprehensive commentsto CMS in response to the rule as well.
The associations urged Congress to provide a positive update to the conversion factor, finalize the proposal to align telehealth services, and adjust subgroup reporting requirements under the MIPS value pathways, among other changes for 2023.
"Practices and coding educators will have to wait for CMS’ final decision. The final fee schedule is expected to be out in early November. However, the key lesson is that practices should be aware of what CMS is planning and wait until the final rule comes out to train staff," Part B News said.
OhioHealth has informed state regulators that it will lay off 58 revenue cycle staff in November.
OhioHealth, based in Columbus, Ohio, just filed a notice to state regulators announcing its plan to show 58 of its revenue cycle staff the door on November 4.
Those affected by the layoffs include accounts receivable specialists, coders, a manager of financial services and a supervisor of patient financial services, according to the notice. The layoff notice, signed by OhioHealth's vice president of human resources, says the layoffs are permanent and no bumping rights exist.
The health system filed the official notice about two months after The Columbus Dispatchfirst reported that OhioHealth was eliminating 637 information technology and revenue cycle management jobs, the system’s biggest layoff ever.
At the time, it was reported the move was part of a plan to outsource some services the system currently provides in house. Some of the other jobs eliminated were in information technology.
This news comes on the heels of the latest National Hospital Flash Report from Kaufman Hall, which said hospitals and health systems are experiencing some of the worst margins since the beginning of the COVID-19 pandemic, putting 2022 on track to become the worst financial year for the healthcare sector since the crisis first started.
OhioHealth is a network of 12 hospitals, ambulatory sites, hospice, home health, and other health services spanning 47 Ohio counties.
