Revenue cycle management remains a core function in healthcare, but it only grows more difficult as traditional payment models shift to alternative arrangements and financial responsibility shifts to the patient.
The healthcare revenue cycle may no longer resemble the process of 10 or 20 years ago, but no matter the level of transformation it undergoes, healthcare providers will always need to seek improvements. "As long as there is an instrument between a payer and a provider, there will always be a revenue cycle," said Ben Foster, managing director at Huron Healthcare, at Becker's Hospital Review CIO/HIT + Revenue Cycle Summit on July 21.
During the session moderated by Scott Becker, JD, CPA, four revenue cycle experts discussed some of the best ideas for improving RCM this year.
1. Identify key metrics. Benchmarking is an important tool, but it should be viewed as a customizable tool. "Let the data take you where it needs to," said Michael L. Duke, managing director of advisory at KPMG. "Don't just pick five metrics. Each organization is an individual." Select specific metrics that will drive performance improvement.
While each organization is different, there are core metrics that can reveal a revenue cycle's health. Look at bad debt and write offs. Reduction in these areas will invariably drive improvement.
There is still room to improve the revenue cycle. "Two to 4 percent [improvement] is still the magic number," said Jeff Noonan, senior director at Alvarez & Marsal Healthcare Industry Group. "But how you get to that number is now very different. The clinical world is now driving financial performance."
2. Embrace the power of your people. There is a wide range of revenue cycle tools and systems. Smaller organizations may be limited by their resources, while larger health systems have the infrastructure to implement systems like Epic or Cerner. Yet, there remains a high level of variance in revenue cycle performance across healthcare, said Mr. Noonan. The answer more often than not isn't the tools, but who is using them.
"It really comes down to people and training," said Tina Marie Schaeffer, vice president of business development with HFA Management. Great tools, but the wrong people are almost always trumped by great people with the wrong tools.
3. Focus on workplace optimization. Employees impact the revenue cycle, but it can be difficult to measure that impact. Mr. Duke recommends tracking employees' operational efficiency and effectiveness ratios. "If you can track what someone does, we want it done at least at 70 percent," he said. Measure employees' effectiveness ratio by tracking how they drive outcomes. It is not just how many cases an employee touches, it is how many they resolve. Work to optimize employee performance and the infrastructure that will support effective outcomes.