As the world emerges from the worst of the pandemic, patients are returning to the clinical setting. The challenges we experienced in 2020 were very different than they are today. Healthcare executives and providers are dealing with new obstacles that are forcing them to rethink almost everything.
The headlines around the healthcare labor shortage used to focus on a deficit of clinical staff. Now, the shortage has extended beyond doctors and nurses and is radically affecting every aspect of the healthcare ecosystem – including how health systems are getting paid.
Earlier this year, R1 commissioned Censuswide to conduct a survey to understand what’s behind these unprecedented challenges. The survey uncovered top priorities, concerns and trends among healthcare executives, with a particular focus on the revenue cycle management (RCM) labor shortage. Results from this survey can be found in R1’s 2022 Mid-Year Healthcare Financial Trends Report.
Labor shortages affect every aspect of care
As patients return to receive deferred care, staffing shortages are causing an array of problems. Here’s what we found:
- Nearly half of all respondents report they are experiencing a severe shortage in their organization’s RCM or billing department
- 33% are experiencing clinical deficiencies due to the shortage
- 96% strongly agree that there is, or will be, additional strain on RCM operations as patient volume increases
Healthcare staffing shortages are just the tip of the iceberg. Among the CFOs and RCM VPs who participated in our survey, ‘increasing costs,’ ‘risk of recession’ and ‘shrinking margins’ are their top concerns. These are big problems that cannot be solved with small, cost-cutting initiatives. Instead, our survey data indicates healthcare leaders are rethinking how their organizations are structured, and more open to partnerships, automation and global delivery than ever before.
“What we have experienced over the last three years has been devastating, eye opening and a call to action to an industry that is a vital part of every community,” said Todd Craghead, former VP of revenue cycle at Intermountain Healthcare and now SVP of commercial relationships at R1. “We are now charged with finding a new way forward.”
The right RCM partner can meet health systems and patients where they are
Elevated patient expectations, a lack of staff and high costs are all contributing factors that have caused many organizations to consider outsourcing their RCM services. Our survey data showed that CFOs and RCM VPs said finding a strategic RCM partner was their top solution for the second half of 2022. In a research brief, Vetting the Right Revenue Cycle Partner, conducted by the Health Management Academy (The Academy) and R1, leading health systems pursue revenue cycle partnerships to improve financial performance, increase efficiency, improve patient experience and create a sustainable workforce.
An RCM partnership can significantly improve hospital revenue cycle operations. The right partner brings deep and broad expertise, industry best practices and technology-driven optimization.
RCM partnerships bring scaled technology that can increase staff efficiency, which is especially important during a labor shortage. These partnerships can also help increase patient adoption of digital self-service tools that reduce costs and improve revenue capture. This type of patient-facing technology meets patients where they are by offering convenient technology most already use in other areas of their life.
The time is right for automation
As patient volumes continue to rise post-pandemic and revenue cycle positions remain unfilled, administrative burdens are increasing. Our survey found that 48% of respondents have witnessed patient billing errors due to lack of experienced staff for coding, claims and reimbursement.
Automation addresses human error, which can cause billing mistakes and even lead to patient care delays, both of which negatively impact the patient experience. In addition to eliminating human error, intelligent automation can carry out many routine, time-consuming tasks including referrals, preregistration, authorizations and payment processing, so staff can take on more complex tasks, thereby increasing staff efficiency.
Global delivery is on the table
In order for RCM companies to keep their solutions flexible and scalable, some work may be supported through global delivery, in which certain parts of the revenue cycle occur in offices overseas. While this may have been an obstacle in the past, a majority of those surveyed have embraced this idea. Among those surveyed, 82% of finance and RCM leaders say their sentiment towards global delivery has become more favorable in the face of today’s labor shortage.
Many RCM companies use a global delivery model; however, not all global delivery models are created equal. The right approach to RCM outsourcing includes full transparency, control and security. The way to realize these is to choose an RCM partner that keeps global delivery within its own company, instead of an RCM partner who contracts with an outside company for overseas work. Keeping all RCM work within one company reduces security risks and maintains high compliance by holding all RCM team members to the same standards no matter where its associates and systems are located.
Craghead says revenue cycle management transformation is the new way forward, and the survey results support this claim. “It’s about optimizing in every way: investing in people, processes and technology, and embracing an open mind regarding partnerships, employee reallocation and global delivery.”