While the coronavirus pandemic wreaked havoc on the lives of millions of people, hospitals and other healthcare entities fought tirelessly to protect both patients and staff.
However, the battle against the pandemic quickly became a war on multiple fronts, as many healthcare systems were forced to contend with disruptions to their revenue cycles in addition to influxes of critically ill patients. According to the Healthcare Financial Management Association (HFMA), approximately 86% of healthcare providers experienced negative impacts to their revenue cycle management (RCM) operations during the pandemic’s first year.
The HFMA further found that larger organizations were hit the hardest, particularly those that did not outsource any medical coding and billing or end-to-end RCM services. And in the midst of the pandemic, the healthcare community was among the industries hardest hit by the mass job departure known as the Great Resignation.
Although the effects of the pandemic and labor market linger, they have also provided valuable insights about the shortcomings of traditional RCM practices and prompted healthcare organizations to employ new services and technologies.
The Pandemic’s Effects on the Healthcare Revenue Cycle
The pandemic has had profound and far-reaching repercussions on the healthcare industry in general. On the revenue cycle front, the pandemic and the Great Resignation have fueled challenges that include:
Increased Demand for Medical Billing Services
The pandemic sparked demand for medical billing services in two ways. First, millions of people developed an urgent need for medical care. An abrupt rise in patient volumes resulted in a higher number of claims. Many healthcare systems simply did not have the internal resources necessary to efficiently process those additional claims.
As medical billing departments became overwhelmed, delays and errors occurred that impeded healthcare providers’ revenue streams. In response, these organizations amplified efforts to increase their medical billing capabilities, either through outsourcing or trying to hire additional skilled workers, the latter of which has proven problematic given the healthcare labor shortage.
The increased demand for medical billing services was coupled with historic staffing shortages. As a result, many organizations suffered diminished processing capabilities when the need for medical coding and billing services was at an all-time high.
The staffing shortage continues, and many healthcare systems struggle to attract and retain qualified employees. This trend not only slows the revenue cycle, but it also weakens the patient experience.
While there is no immediate end in sight to healthcare labor issues, there are options to cover the gaps while simultaneously improving productivity and increasing profitability. As will be discussed below, an end-to-end RCM service can be scaled to a provider’s unique needs and manage core revenue cycle tasks with accuracy and efficiency.
Surging Denial Rates
Naturally, overstretched medical billing services resulted in soaring denial rates for many healthcare entities. The pandemic’s initial year alone saw an 11% increase in medical claim denials nationwide, a number that puts many healthcare providers in a financial danger zone.
Rising claim denials were also a factor in decreased Medicare spending. According to a recent American Medical Association (AMA) report, Medicare reimbursements for physician services dropped by nearly $14 billion in 2020.
But as with the medical coding and billing challenges and staffing shortage issues, a fully integrated RCM service has the capabilities to reverse course on claim denials and help restore a healthy revenue cycle.
Moving Healthcare RCM Forward
The revenue cycle obstacles outlined above were exacerbated by the fact that many healthcare systems still lack comprehensive RCM solutions. The HFMA report mentioned earlier found that healthcare providers who outsourced RCM services experienced fewer claims denials and minimal adverse impacts to their revenue cycles.
In light of the pandemic, a growing number of healthcare leaders have said their organizations are more likely to consider RCM solutions moving forward. RCM technology provides a clear path for healthcare providers seeking to rebuild their revenue cycles amid the ongoing pandemic and labor shortage.
Compared with aging legacy RCM systems, modern RCM solutions offer numerous benefits, including:
Advanced RCM technology features an abundance of functionality to improve accuracy and streamline the revenue cycle. Among the most versatile of these functions are automation capabilities.
Many tasks can be completely or partially automated. This accelerates workflow, enhances precision to reduce claim denials, and frees employees previously tasked with data entry for more dynamic duties.
Data Analysis and Forecasting Tools
As a service-related organization, a healthcare system should always be keenly aware of the patient experience. RCM services can help you provide patients with more effective care through data analysis and forecasting tools.
These tools yield leverageable insights into the patient experience from scheduling through follow-up. The data processed by an RCM solution can track important patient metrics and be used to identify shortcomings in the overall healthcare process.
Denial Management Functionalities
High claims denial rates are a sure sign that RCM operations are inefficient. And if these denials are not appealed and resolved in a timely manner, an organization stands to lose out on even more revenue.
A comprehensive RCM solution offers dynamic accounts receivable and denial management functions designed to reduce denials and expedite appeals. These tools can assist with processing all types of claims and appeals, including clinical, medical necessity and coverage determination.
Reboot Your Revenue Cycle with GeBBS Healthcare Solutions
As an accomplished and experienced leader in health information management (HIM) systems and RCM services, GeBBBS Healthcare Solutions understands the challenges currently faced by healthcare organizations.
Our state-of-the-art, end-to-end RCM services include everything from scheduling and eligibility verification to medical coding and claims submission to credit resolution and patient-access solutions. These services are scalable to meet the individual needs of our partners, and they are created to deliver measurable results.
GeBBS is ranked among Modern Healthcare’s Top 10 Largest RCM Firms, Black Book Market Research’s Top 20 RCM Outsourcing Services and Inc. 5000’s Fastest-Growing Private Companies in the United States. Request a consultation today to learn how GeBBS can help your organization optimize its revenue cycle.