Revenue cycle management has experienced ups and downs in recent years. What lies ahead for revenue cycle management?
Last year, we saw the continued rise of automation and AI. We also saw battles over price transparency.
Continuing the trend from previous years, we also saw healthcare organizations contend with patient expectations, government regulations, and a growing number of technology options.
Let’s take a look at some of the revenue cycle management (RCM) trends we’re preparing for in 2020.
Continued Battles Over Healthcare Pricing Transparency
Healthcare pricing transparency battles occurred across the country in 2019. Expect battles to continue into 2020.
A Waystar survey released in August 2019 found that lack of price transparency was the biggest factor to a negative patient experience. Governments are pushing for increased healthcare transparency, and healthcare organizations are adapting.
Last year, we saw healthcare organizations implement strategies to better manage the patient financial journey. In 2020, we expect healthcare organizations to take the next step.
Some organizations have published the chargemaster online, giving patients full transparency over how much services cost. However, because chargemaster prices are not necessarily the prices charged to the patient, these resources can be difficult for patients to interpret.
In June 2019, the Trump administration signed an executive order mandating that health systems provide out of pocket cost estimations to patients upfront.
Look for increased transparency and better patient access to prices as we move through 2020.
Higher Demand for Revenue Cycle Management RCM Outsourcing
Revenue cycle management outsourcing is becoming increasingly popular among healthcare organizations – and it’s been a trend for several years.
The trend towards revenue cycle management outsourcing is expected to continue into 2020.
Revenue cycle management companies advertise benefits like sharing the risk and reward, which creates a win-win solution for partner organizations. Healthcare organizations can create a sustainable, high-performing engine while still enjoying growing cash flow.
As revenue cycle management outsourcing companies become more competitive, outsourcing is an increasingly attractive option for healthcare organizations.
More Cybersecurity Battles and Ransomware Attacks
Cybersecurity has been a priority for healthcare organizations for over a decade, and this trend is expected to continue into 2020.
Cybersecurity attacks aren’t stopping anytime soon. Healthcare organizations need a coherent cybersecurity strategy to stay competitive.
In April 2019, the United States government reported 44 healthcare data breaches, which was the highest number of healthcare breaches reported in a single month since the government started tracking healthcare breaches in 2010. The previous record was set in April 2018, when there were 42 breaches.
Ransomware attacks are particularly common. Last year, Carbon Black released a study showing that 66% of healthcare organizations experienced a ransomware attack within the last 12 months.
Higher Volumes and Patient Revenue
Hospitals nationwide ended 2019 with an increase in hospital profitability. The increase was linked to surges in net patient revenue and service volumes. Hospitals were treating more patients – and making more money from those patients – than ever, according to a report by RevCycle Intelligence.
This profitability increased despite a slight increase in supply expenses, increases in bad debt, increases in charity care, and mixed performance on expenses.
Over 800 hospitals across the country saw particularly high volumes in adjusted discharges, emergency department (ER) visits, and operating room (OR) minutes.
It was a positive trend after a tough year. The December 2019 increase was the first year-over-year operating EBITDA margin increase in six months. Hospital operating margins also increased by 171.8 basis points compared to November 2019.
Overall, EBITDA margins rose 136.9 basis points year-over-year in December 2019. It’s possible this trend will continue into 2020.
CFOs Are Becoming More Involved
The role of the healthcare CFO has been changing in recent years. 2020 might be the year it becomes even more evident.
CFOs are expected to continue taking a leading role at every level of the healthcare organization. Modern healthcare CFOs don’t just listen: they act.
Healthcare IT Leaders Revenue Cycle Lead, Larry Todd, recently recommended that CFOs go beyond listening and start implementing:
“…any implementation will affect the revenue of the organization so it’s very important for CFOs to be involved in the implementation project and to be informed of key parts of the project that could put the organization and its revenue at risk.”
In the same article, Linda Hoff of Legacy Health described how CFOs need to take a specific interest in not just financials, but also patient satisfaction and quality. All metrics are closely intertwined:
“You have a passion for what you’re doing within your facilities, how you’re interacting with patients. You have to be as interested in patient satisfaction and quality as you are in the financials. If you don’t have that passion for all those aspects, you’re really not going to land yourself in a CFO role especially today.”
Surprise Billing Will Continue to Be Attacked
Surprise billing took a beating at the end of 2019. In December, members of Congress announced the expansion of a bipartisan investigation into supress billing practice. Because of that expansion, the investigation will now look at physician staffing companies and health insurers.
That same month, a Health Affairs study found that annual healthcare spending for patients with employer-sponsored health insurance would drop by $40 billion if specialists were not able to bill out-of-network.
A Kaiser Family Foundation report released in June, meanwhile, found that one in six Americans received a surprise medical bill in 2017 despite being covered by health insurance.
As surprise billing continues to make media headlines nationwide, surprise billing practices will continue to be attacked.
Look for these trends and more to make headlines across the revenue cycle management field in 2020.