How automation can enhance RCM operations

A number of hospitals and health systems are using automation to reduce costs and streamline revenue cycle management processes.

This is particularly true as the healthcare industry continues to undergo changes, such as the shift to value-based care and the move from ICD-9 to ICD-10. Organizations must keep pace with these changes while trying to maintain financial footing and clinical quality.

Some organizations already use business process automation tools to help reduce costs and improve efficiency, but there are also newly available technical solutions that can help improve RCM, according to Mike Duke, principal in the healthcare consulting practice of Chicago-based firm Baker Tilly.

Mr. Duke recently answered questions from Becker's Hospital Review about business process automation, technical solutions and their potential effect on the revenue cycle.

Question: What role do business process automation tools play in revenue cycle management?

MD: Unfortunately, in the vast majority of current revenue cycle management operations, there is not a lot of true business process automation even though several point solutions and enterprise wide vendors in the industry would like healthcare providers to believe otherwise. This issue comes from the fact that very few healthcare providers understand the options available to them with business process automation or they allow specific vendors to define what is possible. However, as the industry evolves in the near future, business process automation will play a significant role in revenue cycle management as vendors become more process centric and begin to develop legitimate solutions to drastically improve revenue cycle automation.

We at Baker Tilly believe that the industry is very close to a tipping point in revenue cycle management approaches and that there is significant opportunity to deploy a variety of interconnected automation solutions that will dramatically reduce the cost of performing revenue cycle activities. Furthermore, while business process automation will affect how the work tasks are completed, the increased analytic capability related to the process centric granular data and continual refinement of automation opportunities will drive higher outcomes over the next several years.

Q: What are some newly available technical solutions for enhancing RCM?

MD: There are some very exciting options in the market now that are beginning to drive real outcome improvements. While this isn't an all-inclusive list, some of the more interesting are:

  1. Machine learning authorization determination and obtainment: These technologies first determine if an authorization is required either through a library of known authorization requirements or through data learning that occurs from payer denial activity. They then use webbot capabilities to interact with payer websites to obtain the authorization information.
  1. Exception based patient responsibility determination and propensity to pay: These tools will first determine the patient responsibility estimate and then use that estimate and other publicly available data to determine if that patient can pay and how much. This allows for the automated flow of accounts depending on their propensity tiers and more effectively work with the patient to either find funding options or setup payment terms in advance of treatment as appropriate.
  1. Advanced claim status determination including auto-account correction and resubmission: While claim status tools have been generally available, they have been limited in nature due to the information that the payer would provide on an X12 277 inquiry return. Through the use of webbot technologies, these solutions can now return not only better data that allows for increased automation of account activity, they can also provide some automated solutions around correcting the claim if in error and resubmit for payment.
  1. Intelligent third party call management: These solutions also use intelligent protocols that determine from historical performance the amount of time provider representatives are on hold waiting to interact with a live payer representative. They then dial the payer based on account information, navigate through various interactive voice response options and when the time is appropriate, route the call to the provider representative so that the hold times are not a limiting factor on productivity. This will dramatically improve individual performance.
  1. Rules based, data driven automated workflow management: These solutions allow for automated task routing based on the needed next step and will route accounts to the next available knowledge worker that is the right individual to address the appropriate next step for resolution.

Q: What are the benefits of these technical solutions?

MD: Early returns on these point solutions have driven interesting returns. The general belief is that there will be a serious impact to net revenue through the reduction in avoidable write-offs and improvements in cash flow, but even more dramatic returns from a cost control perspective. If these business process automation tools are fully integrated into an exception based workflow toolkit, the combination of these types of improvements are expected to target the neighborhood of 40 percent or higher reductions in personnel costs.

These resources can then be deployed throughout other areas of the organization as applicable to further drive down overall operating cost by reducing things such as overtime. Additional hidden financial improvements are typically derived as automation is deployed by reducing the need for outsourced vendors.

Q: Overall, how do you see these technical solutions affecting RCM in the future?

MD: It is our opinion at Baker Tilly that significant results will only be achieved with truly innovative approaches to automating revenue cycle management. Several of these point solution technologies will need to be incorporated into enterprise revenue cycle solutions that will work in conjunction with major EHR systems in the market today. We truly believe the basic infrastructure and business objectives of the large vendors will not be sufficient nor flexible enough to fundamentally incorporate business process automation solutions into their platforms. If providers do not make a conscious choice to fundamentally change their revenue cycle management operations, drastic results will not be achieved. It is also our opinion that if business process automation is not embraced by the industry, value-based reimbursement models will have a negative impact on provider organizations' financial performance. Finally, without the use of innovative business process automation solutions, sustainable financial improvements will be difficult to achieve.


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