I came across a remarkable article by Henry Powderly (Managing Editor) of Healthcare Finance talking about small hospital CFOs’ taking a back seat on upgrading Technology/System for Revenue Cycle as challenges with EHR upgrades, MU and ICD-10 are taking away all their money and focus.
Some of the findings highlighted in this article are mind boggling:
- Two-thirds of hospitals polled in 2012 that intended to replace their RCMplatform with a comprehensive solution still had not upgraded by 2014.
- Black Book’s third quarter study found 83 percent of financial leaders at hospitals under 250 beds expect their RCM systems to become obsolete by 2016
ifnot replaced or upgraded.
- 51 percent of small, under-250-bed hospitals plan to delay RCM upgrades until after the ICD-10 deadline in 2015.
- Small hospital CFOs list ICD-10 coding and electronic records integration well above claims and billing.
As we all know “Technology is a double edged sword”,
One of the key reasons why CFOs consider EHR and ICD-10 as key priority and compromise on upgrading RCM platform or Technology is because they fear more revenue loss due to integration issues and possible massive rejections from payers’ due to transitional phase of ICD-10.
Most hospitals have two challenges while implementing or bringing any chance in Technology/Process for Revenue Cycle Management.
- Financial Burden required in terms of Licensing Costs for New Software
- Human Resources required for implementation/training/transition and accounts receivable
Most hospitals don’t want to experiment with outsourcing as they can’t let go their existing staff members, if they try to outsource by hiring additional resources, it would require more funds on top of technology investments. This creates a chain reaction in terms of investment required to implement new RCM Technology and/or Processes.
I would like to highlight one of the low hanging fruit that most CFOs should consider. It has been observed that Denials’ from payers have increased over the past 2-3 years. It is recommended to create an accounts receivable
Payerdoesn’t have claimon file due to EDI issues Payerhas denied claimfor Authorization issues even though Auth was taken
- Insured information is incorrect.
- Claim applied to deductible
There are other categories of denials such as
appealsfor Medical Necessity
- Request for Medical Records
- Required appeals for inclusive procedures that should have been paid separately
A hospital’s key knowledge Denials Team can focus on categories named above. They should implement a necessary action and outsource the follow-up part to an “outsourced team”.
With proper planning on Accounts Receivable
I would like to end my note with a statement “Money can find more money”. We may have to first find our lost funds to discover more of it from Technology/Automation.