As inflation soars and pandemic-era aid comes to an end, many industries and Americans have been struggling to thrive in the post-pandemic economic landscape. The US healthcare system is no stranger to this victimhood – some of the nation’s largest health systems recorded substantial net losses in the first quarter of 2022. For example, Permanent Emperor recorded a net loss of $ 961 million in the first quarter, and Ascension‘s was just loose $ 884.7 million.
It does not look like these revenue woes will halt anytime soon. Nearly half of health systems and physician groups in the US are behind on their 2022 revenue goals, according to a new report healthcare revenue cycle management (RCM) company R1 RCM shared via email. For the report, R1 RCM commissioned Censuswide to conduct an online survey of 205 chief financial officers and vice presidents of revenue cycle from large health systems and physician groups in the US Responses were collected in June.
When respondents were asked to select their top concern when it comes to the financial health of their organization, the top three choices were increasing costs, the risk of recession and shrinking margins.
Clinical and operational deficiencies due to the healthcare labor shortage were cited as the main problems affecting healthcare organizations’ bottom lines. Other problems that respondents said were among their organizations’ most pressing issues included data security threats, issues with price transparency compliance, lowered patient volumes due to Covid-19 surges, navigating value-based payments, increasing expenses as a result of increasing patient acuity and supply chain delays.
Not only are labor shortages hurting clinical staffing levels, but they are also impacting administrative departments. Forty-eight percent of executives surveyed said their organization’s RCM or billing department was experiencing a severe shortage, 34% said it was seeing a moderate shortage, and 10% said it was seeing a mild shortage. Just 8% of respondents said their organization had adequate staffing for its RCM or billing department.
“While deferred care is making a rebound after two pandemic-stricken years, hospitals are still seeing less overall business than they were three years ago,” said Gary Long, R1 RCM’s chief commercial officer. “Additionally, as patients return for elective services they put off, the labor shortage – specifically within the revenue cycle – is impacting financial operations. The ongoing recruiting, hiring and training of workers with the skills needed to run a health system revenue cycle is costly in ways it cannot afford right now. ”
Long said one of the report’s most poignant findings is that all respondents said strains on the RCM department negatively affect the patient experience. Respondents said they have seen these strains lead to care delays, long hold times for scheduling and customer service calls, and patient billing errors due to lack of experienced staff.
“A bad financial experience can leave patients feeling frustrated and disappointed regardless of the care they received,” Long pointed out.
To address the labor shortage affecting healthcare RCM and billing departments, the respondents said their organizations would make improvements in the following ways: adopting automation technologies (56%), expanding employee benefits and / or compensation (51%) and partnering with an RCM optimization company (44%).
A key action healthcare organizations must take is implementing automation technology into their RCM processes to free up staff from manual tasks, Long declared. He said this will help mitigate the negative effects the labor shortage is having on the patient experience, at least when it comes to billing.
“The revenue cycle can require substantial data entry, claim evaluation resubmission and reprocessing of appeals,” he said. “Artificial intelligence, machine learning, automation and rules engines can generate revenue and reduce costs and are examples of technology that enhance your operations, allowing providers and staff to focus on higher-value work.”
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