Critical Cogs In the Revenue Cycle Management Machine
By William Ayres, director of financial management, Grant Thornton LLP.
A key element in achieving end-to-end revenue cycle success in any healthcare operation is proper dedication and maintenance of workflow tools, and those systems that support processes that help organizations meet net revenue expectations.
Workflow optimization and the deployment of tools should be viewed from four perspectives: People, process, technology and metrics/KPIs/reporting.
It is incumbent on healthcare organizations to explore each of these areas related to RCM workflow optimization and consider relevant questions before deploying a fresh approach to workflow processes and automation. First, they must recognize that a balance of concentration of these four components is needed when building operational effectiveness and for the success of workflow strategy, tools and support systems. Furthermore, it is critical for RCM workflows (front, middle and backend) to reflect the uniqueness (location, size, demographics, payer mix, etc.) of the organization.
While there are many benchmarks and strategies in the industry that an organization can follow, adapt to or adopt, the specific characteristics of the organization – whether it’s a rural versus urban facility, the size and makeup of its staff, budgets, effects of recent mergers and acquisitions, and more – must be inputs when building and maintaining effective workflow controls. Principally, dedication to establishing optimization in workflows within revenue cycle operations is a direct result of senior management’s objectives of lowering or maintaining organizational metrics involving departmental and organizational “cost to collect”.
Organizations’ achievement of desired “cost to collect” results comes from their empowerment of senior and middle management and line staff, adoption of sound strategies that are understood and embraced, provision of user-friendly processes and effective deployment of technology – as well as maintenance of technology in a manner that is adaptable and flexible to the user and the organization.
More importantly and in support the first three components, organizations pursuing workflow optimization must have a process in place for measuring and gauging the success of established RCM goals, as well as clear metrics. Metrics are where the rubber meets the road – they’re how organizations know whether the people, process and technology components are functioning efficiently and as intended.
As in any situation where there is a desire to get from one point to another effectively and efficiently, a sound understanding of how metrics support organizational expectations will inform the direction and strategy. It is also important to note that RCM workflow optimization is system agnostic. While each organization has different approaches to workflow support and automation, they need to look at this component relative to the system they have deployed as well as their own uniqueness.
With a dedicated, all-encompassing approach to workflow operations, organizations are better positioned to process patient access, improve eligibility/benefits verification administration processing, improve Point-of-Service (POS) collections, effectively manage claims loads, process appeals in a more timely manner and improve self-pay production and collections. They can also maintain proper coding requirements, improve overall processing, and possibly reduce denials or denial rates, all while improving overall aspects of the revenue cycle continuum to achieve organizational strategic and revenue goals.
While there is no off-the-shelf, cookie-cutter formula to deploy to achieve expected net revenues and RCM optimization, establishing and maintaining benchmarks consistent with the uniqueness of an organization is key to success.
Organizations must address many questions to understand whether workflow operations and technology are hitting the mark. While a holistic approach taking into account people, processes, technology, and metrics is fundamental for true system effectiveness and performance optimization, there are many considerations associated with each of these areas.
- Does your staff have the capacity to perform production requirements needed for organizational success? Additionally, in deploying resources, are team members in the right positions? Are there leaders who can enable others’ success?
- Do all RCM staff fully understand their roles relative to the RCM end-to-end continuum? Are staff interchangeable or cross-trained to increase operational understanding or in preparation to fill unexpected gaps?
- Does RCM management deploy outsource resources as a stopgap measure?
- Are teams looking at “root cause” issues that will affect workflow production goals and objectives?
- In the case of new RCM systems and upgrades to present systems, are workflow processes reviewed or challenged with respect to potential changes in technology?
- Are RCM operational workflow processes interchangeable so that any new introducing effects do not create abnormalities, gaps, and workarounds?
- Does the organization embrace outsourced help in achieving best practices in workflow processes?
- Should the organization consider a central billing office if one does not exist?
While there are more questions organizations ought to consider in reviewing – and correcting – the effectiveness of the RCM continuum, the areas of people and process should guide the use of resources in the most efficient and effective manner. Furthermore, the structure of operations should allow for adaptable departments(s) and an environment that promotes the achievement of organizational goals and the ability to manage expected and unexpected changes.
Moreover, and specific to the areas of People and Resources (both internally and externally), teams should feel confident and empowered in all aspects and at each stage of the RCM continuum in the effort to achieve revenue expectations and cost to collect goals. Moreover, Processes should be both adaptable and flexible, as well as fully understood and be embraced by the organization. The organization must challenge itself to constantly identify and improve functions involving both people and resources and support processes.
Best practices in workflow management center on the importance of optimizing people, processes, technology and metrics. Again, while no organization looking to improve its overall RCM operations can ignore any one area, there’s no one-size-fits-all solution or magic bullet. Each organization must consider its unique characteristics on the path to RCM workflow optimization.
No organization can achieve workflow optimization without a technology platform that supports the other elements of a good RCM deployment.
There are numerous workflow tools in the marketplace, some of which are part of, or embedded in, RCM claims processing platforms. Some of these embedded workflow applications are designed based on a generic approach to workflow automation and are not always equipped to fully serve organizations’ needs. The adaptability of a selected technology to the uniqueness of an organization is key to achieving RCM goals and producing relevant organizational metrics.
There are many others support technologies designed for a certain type of RCM operation, such as workflow tools for patient access and HIM coding. Some of these are “bolt on” applications that must interface with the main claims processing system or other systems. Understanding the dependencies and effects of these applications on other parts of the RCM continuum is critical. Technology is only as good as an organization’s willingness to understand and deploy its best features. Organizations must also evaluate if that technology enables or hinders them from reaching their financial goals, both in terms of cost and net revenue.
Additionally, and related to resource ease of use of technology, still another consideration involving many aspects of the revenue cycle continuum is ease of use and flexibility, or adaptability of workflow tools to support the resource base that can drive departmental efficiency. Without a full understanding of the technology service offering – both from an IT and RCM perspective – an organization cannot optimize RCM. Furthermore, not fully understanding the deployed technology can lead to catastrophic performance of operational and financial goals and objectives. Seeking outsourced assistance in this area is a best practice for any organization.
With the recent spotlight on artificial intelligence (AI) and machine learning as a means to help organizations improve efficiency and reduce costs, there are new deployments of these technologies involving RCM productions within the healthcare industry. This shift, while sometimes costly, can greatly enhance the movement and production of outstanding inventories. One of the hottest areas involving the RCM continuum is the use of robotic process automation (RPA). RPA is the deployment of software robotics to mimic the tasks that RCM operations resources preform via automated solutions.
A recent Becker’s Hospital Review article highlighted that the adoption of RPA technology could reduce production costs associated with data entry by as much as 70 percent. RPA can be deployed in many aspects of the RCM continuum from verification of patient benefit coverage/eligibility, to more easily determining patient financial responsibility, to the billing process, where automation could greatly reduce denials involving human error entry or pre-authorization. Moreover, technology in the coming years relative to workflow automation will be a critical consideration for any caregiving organization. Workforce automation can save both time and money – and improve overall cost to collect.
Some of the technology question an organization might consider now and in the future:
- How well does the IT department interface with RCM departments to meet the system needs for RCM optimization?
- Is the organization dedicated to IT/RCM governance and in favor of adopting resolution tactics to optimize operational RCM?
- How well do IT vendors address changes and issues, and how well are changes and issues communicated throughout the organization?
Organizational leadership and line staff should feel technology supports both efficiency and effectiveness of the RCM and workflow process. Technology should in no way hinder success; to achieve expected goals and objectives the organization should deploy support both internally and externally.
Sound metrics or key performance indicators (KPIs) can provide the best road map toward RCM departmental success, assuming such metrics offer valuable insight into how to improve overall operations through process and resource workflows. These KPIs can also help management correct the gaps, breakdowns, interface issues and ease of use problems resulting from deficiencies and/or inefficiencies with the current RCM technology and application deployment.
Key to developing effective KPIs to drive operational efficiency is access to good data. Data must be useable and accessible to support management and its decision-making. To this end, organizations must have up-to-date, accurate data warehouses that facilitate the identification of KPIs and critical RCM metrics. As reported recently by the Healthcare Financial Management Association, “One of the best ways to trend data is to use the healthcare data operating system (DOS™). DOS combines data from disparate IT systems – clinical, financial, HR, and more – and optimizes it for analysis.” This approach allows the organization to visualize data, helping spot root cause issues and trends.
There are a range of considerations around KPI/metrics organizations must address to support proper workflow management and RCM optimization:
- Is the organization committed to understanding, formulating and deploying KPIs to drive organizational performance and dedication to RCM optimization?
- Are resource performance metrics rolled back to look at cause and effect related to other overall RCM metrics such as A/R days, DSO, denials, denials root causes, denials percentage reduction, appeals, clean claim rate and cost to collect?
- Do KPIs allow management and designated staff to spot trends and potential improvements, and are they trackable to support RCM optimization?
- Does the organization use a data visualization tool set to support ease of KPI metrics?
Careful consideration of all of these questions involving workflow management can help organizations work toward RCM optimization. Organizational distinctiveness cannot be overlooked in developing a framework for effective workflow management. Creating an environment adaptable to internal and external changes will help the organization consistently meet revenue targets and other business goals.
Moreover, key stakeholders should look internally as well as externally to challenge the organization in improving overall RCM performance with an eye on each of these critical elements. Each component – people, process, technology, and metrics – should operate interchangeably and in support of one another.