How one revenue cycle leader plans for his health system and its RCM partner to work together throughout their partnership.
VHC Health recently announced a 15-year, revenue cycle management partnership that comes at a time when leaders' satisfaction with vendors is largely varied and financially strained systems are hesitant to make the investment.
In a previous HealthLeaders article, John Zabrowski, the system's senior vice president, chief financial officer, and chief strategy officer acknowledges this trend, but suggested that organizations pulling out of vendor agreements may be due to them not aligning with the organizational culture.
For VHC Health, partnering with a vendor they've worked with for multiple years, reflects they fit into the system's culture. Bringing executives from both entities together, alongside the system's revenue cycle team leads, forming a governance council to oversee the partnership allows them to share accountability, laying a solid foundation.
"The way we've carved it out, we've got a strong three-pronged approach that allows for a strong operational alignment, strategic alignment, and organizational alignment to achieve the goals of this partnership," Zabrowski said.
Prior to their current partnership, the VHC had been utilizing their partnership vendor for ancillary services for five years. Now, over a month into the partnership, the system has found over $13 million of incremental value that is "currently in the process of collection and realization."
Initial goals for the partnership include streamlining their patient registration process and integrating AI into the denials process. According to Zabrowski, integrating more robust physician advisory services into the organization is an area of emphasis as well.
To oversee the partnership's progress and performance, the team created a shared governance council of VHC executives, revenue cycle leads, and vendor representatives.
"There's a weekly touch base where we'll be discussing our [key performance indicators], revenue cycle metrics, how are realization rates looking, what's happening with denial trends," Zabrowski explained.
Key performance indicators include accounts receivable per day, insurance aging, number of accounts held up in billing, and coding accuracy rates.
While these metrics are important to the overall management of RCM activities, Zabrowski said, the target goals for the partnership emphasize improving clinical documentation and the system's overall yield.
For the system's yield, efforts are being made to optimize point of service collections, with tech solutions being deployed to help reduce front end denials.
"From a clinical documentation improvement perspective, extended deployment of related practices, education, auditing, and workflow redesign will serve as the foundation upon which our improvements are built upon," Zabrowski explained.
At a time when revenue cycle leaders are being more conservative with their vendors, one health system is betting big with a 15-year contract.
Editor’s note: The article was updated on 2/2/24.
Revenue cycle leaders have been implementing technology for years, and as some vendor promises are falling short or systems remain incompatible, more leaders are becoming conservative when implementing new tech and signing those long-term contracts.
But not VHC Health.
Earlier this month, VHC Health announced an exclusive, 15-year partnership with Med-Metrix, a revenue cycle management solution provider, for end-to-end coverage of the system’s revenue cycle functions.
As mentioned, the partnership deviates from the current trend of revenue cycle leaders moving away from outsourcing operations, usually due to a lack of results. But, John Zabrowski, senior vice president, chief financial officer, and chief strategy officer at VHC Health believes that there’s a trend “in both directions.”
“Regarding organizations pulling out [of contracts], I would argue the agreement and cultures were not aligned,” he said.
Why such a long contract?
The system had already established a relationship with the vendor for different ancillary services and as they considered different RCM providers, the familiarity and demonstrated reliability set them apart from the rest.
“When we coupled our past experience with a thorough review and understanding of what else we could bring by moving that relationship a little deeper into an end-to-end process, it just made a lot of sense,” Zabrowski said.
Having a 15-year agreement, compared to 10-year agreement, Zabrowski explained, will allow the system to get more value from the partnership. One month into the partnership, the partnership has found over $13 million of incremental value that is “currently in the process of collection and realization.”
“My view is in a 10-year deal, you’re really getting seven years of value and I just don’t find that to be worth the effort,” Zabrowski explained. “If I take those same time frames, I can generate 12 years of value on a 15-year deal and spend a lot more time executing, refining, and driving value for the system.”
As the system begins to implement the partnership, a shared governance council will develop 30- and 60-day plans and identify priorities and high value areas within the system’s revenue cycle.
“The reality of the situation for organizations terminating agreements and pulling back, they most likely forgot the most important part of the equation: people,” Zabrowski said.
Consistent with the system’s “people first” philosophy, in addition to C-suite leaders like the chief information officer and chief operating officer, revenue cycle leads are also part of the shared governance council.
“It’s a very clear open governance structure to make sure that from an overall management perspective, our priorities remain aligned, and we’ve got real clear communication,” Zabrowski said.
HealthLeaders surveyed 87 revenue cycle executives on expanding tech in their operations, staffing, and their priorities for the year. Here's what they said.
Automated Intelligence is slowly cementing itself in the middle of the revenue cycle.
The predictive capabilities of AI solutions enable health systems to use them in administrative and clinical settings. Considering how data heavy revenue cycle operations are, alongside the difficulties in hiring and retaining medical coders, it’s popularity isn’t a trend—it’s a remedy.
According to a 2023 Medical Group Management Association Stat poll, 34% of medical group leaders said they were having difficulty hiring medical coders. The Bureau of Labor Statistics also estimated that around 12,300 medical records specialist roles are to be created between 2021 and 2031.
Many revenue cycle leaders feel that coding and areas like denials management require more expertise than other parts of the revenue cycle, implementing AI solutions can save them time and money.
In 2023, Henry Ford Health integrated AI into its bedside procedures to assist with medical coding. The system performs over 700,000 bedside services each year, making it one of their highest volume specialties, accounting for 20% of overall coding costs.
“Because staffing is at a premium, by automating our bedside visit coding, we can shift resource to other areas of need,” Joann Ferguson, the system’s vice president of revenue cycle, previously told HealthLeaders.
“Regarding the big picture on the people side of Henry Ford Health, it reduces the daily workloads on physicians, medical coders, and billing administrators, driving better financial and operational performance while improving our coders’ job satisfaction.”
In addition to increasing workflow efficiency, implementing AI has enabled the system to address gaps in their patient experience and identify charge gaps.
When it comes to current revenue cycle operations, it's a technological arms race to find the best solutions with the most capabilities.
HealthLeaders surveyed 87 revenue cycle executives to see how many are prioritizing revenue cycle technology transformation within their organizations.
The partnership will provide end to end coverage of the system's revenue cycle functions.
When it comes to revenue cycle management solutions, for Virginia Health Center, it’s not about finding the tools to complete tasks but finding the right tools to support its revenue cycle workers.
Earlier this month, VHC Health announced an exclusive, 15-year partnership with a revenue cycle management solution provider for end-to-end coverage of the system’s revenue cycle functions.
According to John Zabrowski, senior vice president, chief financial officer, and chief strategy officer at VHC Health, while the system has an exceptionally high performing team, there were some challenges keeping them from reaching their full potential.
“The thing that we really wanted to solve was making sure that our associates had the right tools, the right technology, and the right support so they could do their jobs,” Zabrowski told HealthLeaders. Additionally, the system also wanted to provide an opportunity for people to advance within their current roles to encourage career growth and increase employee satisfaction and engagement.
The system had already established a relationship with Med-Metrix for different ancillary services and as they considered different RCM providers, the familiarity and demonstrated reliability set them apart from the rest.
“When we coupled our past experience with a thorough review and understanding of what else we could bring by moving that relationship a little deeper into an end-to-end process, it just made a lot of sense,” Zabrowski said.
Additionally, a 15-year agreement, compared to 10-years, he said, will allow the system to get more value from the partnership.
“My view is in a 10-year deal, you’re really getting seven years of value and I just don’t find that to be worth the effort,” Zabrowski explained. “If I take those same time frames, I can generate 12 years of value on a 15-year deal and spend a lot more time executing, refining, and driving value for the system.”
As the system begins to implement the partnership, a shared governance council composed of Med-Metrix and VHC partners will develop 30- and 60-day plans and identify priorities and high value areas within the system’s revenue cycle.
Consistent with the system’s cultural “people first” philosophy, in addition to C-suite leaders like the chief information officer and chief operating officer, revenue cycle leads are also part of the shared governance council.
“It’s a very clear open governance structure to make sure that from an overall management perspective, our priorities remain aligned, and we’ve got real clear communication,” Zabrowski said.
HealthLeaders surveyed 87 revenue cycle executives and these were their responses.
As revenue cycle management technology continues to evolve and streamline previously tedious tasks, its no surprise that just about every organization has implemented some type of solution. HealthLeaders asked 87 revenue cycle executives what percentage of their revenue cycle operations are fully digitized or automated and these are the results.
As organizations level up their technology, hackers are leveling up their tactics – with a new target.
The American Hospital Association released a statement about a social engineering scheme where hackers pose as IT help desk personnel to steal information from revenue cycle workers or those in “sensitive financial roles.”
According to AHA, the threat actors will call IT help desks and use the “stolen personally identifiable information” of an employee to answer security questions. Hackers will then request a password reset and enroll a device, like a cell phone, into multi-factor authentication.
The cell phone will typically have a local area code, allowing the hacker to bypass pre-existing multiple-factor authentication to access the email and applications of the employee they’re impersonating.
Ransomware attacks have been the most common cyberattack, putting patient care for entire health systems at risk. In 2020, Oregon’s Sky Lakes Medical Center was forced to shut down all operations after a ransomware attack through a link an employee clicked in an email.
The medical center had to completely rebuild its network, director of information systems, John Gaede previously told HealthLeaders.
“We had to build backups and test them first to make sure they were clean, then run the [main systems] through tests to validate that they can work,” he said. “We didn’t want to start something up, have it [integrate] with another system and have everything fall apart.”
According to John Riggi, AHA’s national advisor for cybersecurity and risk, one health system now requires employees to make password and multi-factor authentication enrollment requests in person after becoming a victim to a social engineering scheme.
“The risk posed by this innovative and sophisticated scheme can be mitigated by ensuring strict IT help desk security protocols, which at a minimum require a call back to the number on record for the employee requesting password resets and enrollment of new devices,” Riggi said in a statement.
“Organizations may also want to contact the supervisor on record of the employee making such a request.”
Patient collections has surpassed denials management as the biggest concern for revenue cycle leaders, a new report found.
Should you be taking a closer look at your back-end operations? While denials management is a longstanding issue for an organization’s revenue cycle, a recent report found that timely patient collections are a growing concern.
In the report, authored by Salucro Healthcare Solutions, 48% of revenue cycle leaders said patient collections are the biggest issue they’re facing, surpassing familiar issues like denials management and hiring/staff training.
Patients have begun covering a larger portion of their care in recent years, and difficulties with understanding benefits, lack of price transparency from providers, and complex billing processes make for a frustrating experience.
Some organizations, like Allegheny Health Network, turned to technology for a solution that would benefit the organization and help patients understand their healthcare costs. After implementing a financial engagement platform, patients now have access to a patient portal where they can set up payment plans and access additional self-service tools.
“It was clear to us that the patient billing process is broken, and that providers and payers alone can’t solve the systemic challenges,” James Rohrbaugh, then chief financial officer and treasurer for AHN, previously told HealthLeaders.
Organizations can also ease the frustration of the patient financial experience by employing cash sharing applications like Zelle and Venmo. In a previous article, HealthLeaders reported on how providers are gradually embracing the apps due to their accessibility and ease of use.
"They don’t have to grow up in the revenue cycle, but they have to be able to cross the network," one executive told HealthLeaders.
When implementing a rev tech solution, strategy, key performance indicators, and vendor-provider collaboration are often touted as ways to ensure its success. However, there’s an additional, lesser-known component within the organizations themselves: the IT department.
By definition, an organization’s information technology department manages and resolves issues relating to computers and its greater technical network (tablets, medical machinery, etc.). As organizations consider investing in tech solutions, Jeanne Stokes believes IT staff should be part of the conversation.
At Ironwood Cancer and Research Centers, where she serves as director of revenue management, the practice has three IT specialists who assist with phone lines, revenue cycle operations, and radiology program software, respectively.
"I think with [IT specialists], we don’t have enough. We traditionally don’t hire huge amounts of IT folk. We hire just enough to get through," Stokes explained.
When the practice was having issues with a payers’ application programming interface (API), she had a member of the IT staff shadow and work alongside front desk workers to get a better understanding of how to address the problem.
"I need him to go to the front-end user to actually learn how their days go and let them be part of the conversation," Stokes said. "I think that would help them feel more engaged and have more ownership in what’s going on. Things would be better if we [consider things] from the front-end staff’s position instead of [from the executive’s position]."
Stokes also touted the benefits of having IT staff having a fundamental understanding of the revenue cycle and knowing where to find answers. For example, Ironwood sends their IT specialist to rev tech vendor conferences almost every year so that they’re able to stay up to date on the software and attend sessions to learn more about the revenue cycle.
"They don’t have to grow up in the revenue cycle, but they have to be able to cross the network," she said.
There’s similar value in bringing revenue cycle workers into the decision-making process, enabling them to become well versed in the solution’s functions and have ownership of its operations.