Hospitals’ median operating margins in February were down 27% year-over-year while expenses per adjusted discharge were up 31% for that same period.
Facing substantial financial and operational pressures even without the COVID-19 pandemic, has left many hospitals struggling financially.
Based on these challenges, ParaRev: A CorroHealth Company discusses how organizations can position themselves for an unknown financial future in a recent eBook. The eBook, Building a Financial Safety Net: Implementing Safeguards to Achieve and Sustain Revenue Integrity, identifies key financial pain points and then outlines key elements which must be precisely calibrated to achieve optimal accuracy, efficiency, and sustainability in your revenue cycle.
Establishing a financial safety net is critical for organizations to help achieve and sustain revenue integrity. Utilizing both internal and qualified external resources to create a financial safety net can provide an end-to-end approach that optimizes automation to reduce staff demands while relying on human expertise to address specific revenue cycle issues and chronic pain points. These issues can include:
- Labor shortages − experienced personnel resigning and costs escalating
- Payer problems − difficulty in ensuring appropriate and consistent reimbursement
- Technological challenges − ineffective systems making it challenging to understand how, where, and why underpayments and denials are occurring
- Ineffective financial processes − improperly set up EHR-based contract management systems generating inaccurate netted amounts
- Unsupported pricing strategies – Inefficient and noncompetitive, negatively impacting revenue
- Poor communication/quality assurance – creating major lost revenue opportunities and potential compliance exposure
4 Steps to calibrating the revenue cycle
Establishing a financial safety net to help ensure revenue integrity requires that the revenue cycle be viewed as a single process made up of component elements, each of which must be precisely calibrated to achieve optimal accuracy, efficiency, and sustainability. From the establishment of fee schedules to eligibility verification, medical documentation, coding edits, clearinghouse operations, payment posting, and denial management, every process should be carefully assessed and, if necessary, reengineered to achieve the highest level of performance.
The steps discussed in this eBook cover:
Step 1: Rational pricing that relies on a systematic process including pricing review, comparison, and optimization
Step 2: Patient collection process based on comprehensive patient collection improvement methods before or at the time of service along with price transparency
Step 3: Revenue integrity assessment of each element of the revenue cycle
Step 4: AR recovery and resolution solutions deployed using intelligent automation, process engineering and staff specialization
The pandemic may be receding, but organizations will undoubtedly continue to face an increasing shortage of qualified workers, rising costs, and downward pricing pressure in the years to come. It is now more critical than ever for hospitals and healthcare systems to take the opportunity to implement safeguards to achieve and sustain revenue integrity.