Welcome to the June 2023 issue of Cycle Up. Did you know that when it comes to revenue cycle management (RCM), many hospitals, health systems and physician groups fall for the trap of targeting low-cost vendor solutions to save money in the short run? Unfortunately, this strategy ends up costing exponentially more in the long run. Let’s take a look at why this is so.
When healthcare providers push for deep discounts on RCM solutions from their vendors, most vendors do the math to figure out how to reduce internal costs and services commensurate with the lower fee so they can reduce the financial impact as much as possible to protect the business. Typically, it’s the providers or their patients who end up losing.
Meduit has tracked lower contingency rates showing that they in fact lead to lower recoveries. In the end, the provider loses more revenue than gained in fee reduction, equaling a net financial loss and substantially diminished service to patients. Here are the key things you should focus on to work smarter and get better financial results:
- Push self-pay vendors to get creative in increasing patient contacts and use advanced segmentation to identify what it will take to generate maximum patient payments. While this isn’t always the cheapest solution, it’s the one that yields maximum recovery and maximum points of contact for patients. Read more in the following article from this edition of Cycle Up: How Two Organizations Reduced AR Days to an All-time Low
- Work ALL insurance accounts. Most healthcare organizations are understaffed. Don’t ignore the situation. Instead, consider outsourcing small balance accounts and denials and leveraging artificial intelligence to generate higher revenue. While this does cost more in the beginning, it generates far more additional revenue that eclipses the cost. Read more in the following article from this edition of Cycle Up: Spotlight on Outsourcing Insurance Accounts to Drive Cash
- Deploy “Found Money” solutions to generate revenue/cash in places you didn’t know you had it, and contract for these solutions on a contingency basis so that you only pay if you get more than you paid back in return. Read more in the following article from this edition of Cycle Up: Effective Solutions for Recovering Missed Revenues
In the end, all of these solutions are actually better for the patient financial experience, so you win on that front, as well. For example:
- Full-service patient payment solutions allow your customers to interact with you in the way they prefer to interact. It provides multiple and frequent connection channels to develop loyalty. Giving patients multiple options to pay/finance their health care has shown in study after study to create appreciation and loyalty.
- Ensuring that insurance accounts don’t get denied unnecessarily and that payment from insurance claims isn’t delayed helps create clean patient billing and lowers patient frustration with your brand.
- Found Money solutions ensure you’re getting fully paid and allow you to redeploy that money into better services for your patients as well as your employees.
No one wants to lead the race to the bottom. Let your peers choose to run a losing race while you take market share, build a stronger brand, and support financial resilience for the future. Generating more from your revenue line is financially more impactful than expense reduction.
I hope you find this issue of Cycle Up informative and useful to your enterprise.