The system's operating margin fell to -3% during the 2022 fiscal year, but has since stablized.
A recent study by healthcare advisory firm Chartis found that more than 50% of rural hospitals are currently operating at a loss, with 167 rural hospitals having closed or stopped inpatient services since 2010 and 418 currently in danger of closing.
Kirsten Largent, senior vice president of financial operations for OSF HealthCare, which serves rural patients in Illinois and Michigan, says the system's operating margin pre-COVID was 3%. During the 2022 fiscal year, the margin fell to -3%, which she attributed to significant workforce disruption.
Largent says the system's finances have stabilized since then.
"The trend of operating results improved quarter over quarter during fiscal year 2023, ending the year with breakeven operating performance," she says. "This was an improvement of over $117 million."
Largent credits the turnaround to a rebound in patient volumes, reducing agency costs, renegotiating managed care contracts, and strong performance on value-based contracts.
Adapting to the financial strain throughout healthcare, Rene Woerner-Utley, vice president of patient accounts at OSF, says the system focused on the patient's revenue cycle experience. As well as offering self-service payment plans for up to 36 months, the system implements text and email reminders and a billing chat bot on its website.
In addition to the billing chat bot being able to answer patient's questions about their statements, it can also triage and advise them about the right point of care for their health concerns.
"We use many vendors as extensions of revenue cycle to assist with some of the niche billing requirements," Woerner-Utley says. "These include, but are not limited to, vendors for workers [compensation] and third-party liability billing, second level clinical denials, low dollar account collection, and coordination of benefits collection, to name a few."
"We want to meet the patient where they are and give them access to these services 24 hours a day, seven days a week," she says.
Jasmyne Ray is the revenue cycle editor at HealthLeaders.
KEY TAKEAWAYS
OSF broke even in fiscal 2023, which is good news considering that margins were in the red in fiscal 2022.
OSF is focusing on revenue cycle with an emphasis on easing self-service payment access for patients.