Think Tank Insights: Maximizing Revenue Cycle Performance

With uncertainty and revenue shortfalls still a prevailing reality, revenue cycle leaders are faced with three core mandates: preserve financial viability; implement updated KPIs to reflect the new environment; and lay the groundwork for accelerated revenue capture and growth.

Connex Community Members met on March 8th to discuss the primary barrier to these goals and their own experiences in working to overcome them. Most notably, the group explored employment challenges amidst a growing labor crisis; the need for more expanded automation capabilities; and how hostile payer behaviors are delaying revenue capture through a blend of denials and underpayments.

Employment woes

Even the quickest glace at industry headlines will make one point abundantly clear: healthcare is undergoing an unprecedented labor shortage. The national conversation is primarily focused on frontline care teams, but the reality is that back-office functions like revenue cycle are being hit just as hard. This poses a serious threat to Providers’ financial security, and as explained by one think tank Attendee, is keeping them from achieving cash targets by as much as 3%. Collections, patient access, and coding teams are all short-staffed, which when combined with delays from the recent holidays leaves very few choices: either the process is delayed, A/R continues to creep up, and quality takes a hit; or premium labor and third-party outsourcers are called in as an additional expense to make up the difference.

While there aren’t many ways to improve hiring volumes outside of casting a wider net or offering a more compelling total rewards package, there are ways to improve staffing by targeting employee engagement. The more employees feel engaged, the more likely they are to be retained, and the fewer new positions open up, at least preventing the problem from exacerbating. As explained in both this discussion and Connex’s many Human Capital Executive conversations, keeping employees interested is often a matter of career growth. Today’s professionals want to be developed, see a future with the organization, and an opportunity to regularly advance, and investing in existing team leads is often the place to start. Most revenue cycle leaders were promoted for their technical excellence and subject matter expertise, not their interpersonal skills. By giving them the tools and strategies needed to have more frequent and productive mentoring, coaching, and performance conversations with their staff, Providers can cultivate the kind of employment experiences that encourage someone to stay.

Another way current leaders can help, especially with remote teams, is by humanizing the work experience. That is to say, intentionally creating processes and systems for setting aside time to decompress – whether that be a social coffee break, a five-minute commiserating session at the end of a meeting, or regular one-on-one personal life check-ins. One Attendee explained they’ve taken fun-at-work to its logical conclusion by layering gamification technology on top of their revenue cycle workflows, both making them more enjoyable and even achieving greater overall performance by tapping into employees’ competitive natures.

Automation: achieving the next-gen rev cycle

While approaching these challenges from a labor perspective is imperative, the elephant in the room persists: there is too much to do, and it’s becoming cost-prohibitive to rely on manual labor. In response to this, the conversation shifted towards automation and the ways in which advanced technology like bots, machine learning, and AI can be leveraged to do more with less. One Member that had recently completed an RFI explained that the market’s current options broadly fell into three categories: revenue cycle-specific automation tools; industry-agnostic automation platforms; and VC-backed holding companies that brought together numerous point solutions. Each comes with its own benefits and setbacks, and depending on a Provider’s specific needs and existing infrastructure, a case could be made for each.

Attendees shared several examples of how they’ve used these technologies, with claim statusing, computerassisted coding, and automated coding being the most frequently cited. One Member with a more sophisticated program gave additional insight into the strides they’re making, explaining that they’re using a machine learning algorithm to assist in prebill, post-discharge claims reviews to evaluate if short stays should be converted to other designations. The algorithm had learned to predict payer responses and behaviors based on previous claims data, and has become more accurate than on-staff nurses in making that determination. As a result, when there’s differing recommendations between personnel and the algorithm, they trust the latter. Another particularly sophisticated use case was shared by another Member who had purchased more than 100 bots that, once configured, will handle all billing edits. This will effectively automate billing end-to-end, and work in tandem with automated claim statusing, insurance verification, and cost/liability estimation tools, bringing them ever closer to achieving a truly automated revenue cycle.

However, the topic was not without its criticisms. On top of anecdotes about half-baked software, unfulfilled promises of functionality, and cautionary tales about having clear launch dates worked into contracts with solution providers, one Attendee explained how automation can paradoxically make labor issues worse if not sufficiently supported with workflow changes. In their case, automating communications around the No Surprises Act and financial assistance applications led to a massive uptick in customer service call volumes and application reviews that had to be addressed manually. Another explained that in their view, automation in isolation was insufficient. Instead, they felt it must be paired with a full reevaluation of processes and employee skillsets to redefine revenue cycle; this would in turn help elevate it from just a way to handle repeatable work to a means of actually achieving the purposeful, outcome-based revenue cycle desired.

The ever-present thorn of payers

Denials and underpayments are reportedly even more common now than before the pandemic, and while Attendees admitted operational gaps, documentation issues, and process inefficiencies are all partially responsible, it’s the payers themselves causing the most headache. Investing in specialized denials and underpayment recovery teams, equipping them with more advanced technologies, and strengthening the collaborations between units like UR and CDI can all help, but many payers seem determined to be as obstructive as possible.

The prevailing sentiment was that payers have taken advantage of the crisis, attacking claims on the basis of authorizations and medical necessity harder than ever before. Prior authorization denials were the most frequently cited issue, even in cases where the documentation clearly showed that prior authorization was achieved. While this is sometimes caused by delays between the payer and their authorization subcontractors, many Attendees felt their rejections were intentional. And payers aren’t garnering much sympathy or grace given their other actions, such as using their entire contract allotted turnaround time to delay payment as long as possible, only to then further extend those limits on the unsubstantiated basis that their own labor issues prevent them from being timely.

More aggressive contract negations, monthly or biweekly meetings with payer reps to discuss ongoing issues and turn over batch unjust denials files, and even litigations were all mentioned as best practices. Members stressed the importance of data as a tool for demonstrating payer fault and making the case that denials are causing undue hardship. Some are trying to use that to push for full or partial upfront payment, with the expectation that a retro audit would correct for the rest. However, one Attendee cautioned that this could create more work if not meticulously defined, controlled, and communicated.

Strength in numbers

Overcoming today’s complex revenue cycle challenges will require a coordinated approach that accounts for all these barriers, and interestingly, that idea of coordination was reflected in perhaps the Think Tank’s most promising recommendation. While automation and labor can be managed internally, pressuring payers to cooperate could be best achieved by collaborating with external partners. Either by forging relationships within one’s local market, or by working with other facilities within one’s system, approaching payers en masse puts them in an uncomfortable position that’s much harder to ignore. With a bit of trust and data sharing, this can also lay the foundation for more impressive feats like collective contract negotiations that benefit each Provider involved. There is the risk of retaliatory action – as one Attendee explained, their system’s collective demand for denials correction and better accountability was met with a demand letter for refund requests – but payers have left Providers with few other options to make their needs heard.