Don’t Ignore RCM Solutions that Deliver a 7.7x Return
Posted on Wed, Mar 30, 2016
Right now, your hospital is ignoring major revenue opportunities and, at the same time, losing money on basic revenue cycle functions. We talk to clients just like you every day, that’s how we know. Their outdated RCM solutions aren’t doing enough to address:
Pre-Registration and Registration Failures
Rising Bad Debt
Are your numbers where you want them to be, relative to best-in-class standards, in all of these categories? In any of them? Have you ever stopped to attach a dollar amount to each area of underperformance? We have and we want to share it with YOU.
In fact, we went through that exact exercise for one of your competitors, a Midwest health system consisting of three hospitals and multiple physician-care locations. Together with an independent healthcare consultant, we conducted an up-close client assessment (spending time in facilities, interviewing staff, analyzing data and existing technology). The goal? Identify what’s not working and what could work better—from medical necessity checking and preauthorizations, to POS patient estimates/cash collection, etc.—then assign a number next to each line item. We drilled down in six different buckets.
Here’s just one example of the untapped, cost-saving opportunities we found:
Current Average Registration Time: 15 minutes
Registration Time Improvement Goal: 33% (From 15 minutes, down to 10)
Year One Savings: $99K
Year Two Savings: $197K
Year Three Savings: $197K
In total, the opportunities to reduce costs, achieve synergies of technology, and improve profitability across patient access/RCM functions totaled a 7.7x ROI.
Okay, time out. “Where do these numbers come from?,” you’re asking. How do we know the rate at which registration times can be cut, using leading-edge RCM solutions?
This is actually the most modest improvement scenario we could derive, based on the successes of other health systems using our patient flow management software and other tools.
Collectively, our products drive registration time, registration accuracy, physician order management, overall patient wait times—you name the category—to best-in-class standards. We’ve seen hospitals save thousands time, and time, and time again. Even in environments where employees are saying they’re overworked, we’re showing how departments can be more efficient, how leaders can reallocate FTEs, and how facilities can free up staff to deliver markedly better patient experiences.
Nevertheless, there’s a persistent disconnect between what’s possible and what’s actually playing out in hospitals across the country. In part, we can attribute this to a communication breakdown. If you’re a C-suite decision maker in healthcare, you may not be getting all the information you need to make decisions. Your staff may be;
Afraid to ask you for money,
Avoiding solutions that will temporarily disrupt the status quo,
Unconcerned about ROI, as they’re simply not incentivized to be.
And here’s a telling fact about how often RCM solutions get pushed aside: In a 2012 survey, hospital leaders were asked about their RCM platforms. Two years later, two-thirds of those who intended to replace legacy systems still had not upgraded.
Bottom line: yes, technology is just one piece of the RCM equation. The right people, together with the right processes, empowered by the right technology, all equal success. Technology plays a major role.
Want us to “show our work” behind all this math? Contact our team today. We can explain what we’ve helped others achieve, and create an individual ROI analysis for your organization.