Revenue cycle management is not a zero-sum game: 3 expert takeaways

Revenue cycle management is not a black-and-white problem. There are shades of grey painted by patients and payers, that show up through the entire process, which strong financial leadership can influence.

Cedar CEO and Co-founder Florian Otto, MD, PhD, former Chicago-based Sinai Health System Vice President of Finance Jim Porter and San Francisco-based Dignity Health CFO Douglas Watson discussed ways to improve hospital system revenue cycles at Becker's Hospital Review 7th Annual CEO + CFO Roundtable Nov. 14 in Chicago.

Note: Responses were lightly edited for style and clarity.

Here are some key takeaways:

Mr. Porter on the importance of data in revenue cycle management: A main focus I've seen in the last several years has really been getting after data, mining that data, trending your data, benchmarking your data and really understanding your data. We all have our KPIs and various metrics we're measuring, but I've really focused on segregating that data between what the payers owe us and what the patients owe us. We've seen a metric for several years of uncompensated care as a percent of net revenue. I've been successful and really feel it's important to drill that down to not just know your bad debt, but [to know] really what percent of that bad debt is a patient's responsibility? ... Getting into that data and understanding patient responsibility is of the utmost importance.

Mr. Watson on the top things Dignity Health is doing to improve revenue cycle performance: To use a sports analogy, revenue cycle is definitely a contact sport. When I first got to Dignity, I started doing monthly meetings to get everyone in one room and work through the problems. … It wasn't just to admire the problems. We were going to spend two to three hours to work through the problems and fix them. If we needed somebody else in the room, next time they were going to be there. That made a huge difference, getting that discipline. Before that it was the endless emails trying to figure out how to get something to happen.

Mr. Florion on changing consumer perceptions: The No. 1 typical misconception is, 'Yes, healthcare is different.' I hear that again and again and I agree, healthcare is different from some other industries; however, the consumer is the same consumer that shops on Amazon, watches Netflix and books a trip on and expects the same service and level of engagement from their healthcare provider.

There are misconceptions that patients don't pay because they don't want to pay, or because they cannot pay. I don't believe in that for one reason. If you asked random people on the street, 'Would you pay your bill?' I think if they understand it, if it's fair and it makes sense, I think 80 to 90 percent would say, 'Yes.'… [An interesting statistic is] 50 million people in the U.S. have a bad credit score because of medical debt. Half of them have an otherwise clean credit score and a median outstanding debt of $200. That's not an ability to pay problem. We don't have an ability to pay problem. I think we've made it very hard for patients to pay. … Hospitals are hospitality companies. There was an interesting study that said patient satisfaction at discharge compared to patient satisfaction 60-days post discharge was dropping 30 percent. What is happening in-between? It's only the billing process.

Another misconception I've seen is [revenue cycle is a] tradeoff between how much money you get or if you want high patient satisfaction, [that]. it's a zero-sum game. That's not true.… Both are possible.

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