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Analysis

8 Trends that Rocked the Revenue Cycle in 2019

By Alexandra Wilson Pecci  
   December 30, 2019

As the sun sets on 2019, we look back and reflect on the major news and trends that shaped the revenue cycle this year.

From the tumultuous battle over price transparency to the rise of automation and the ushering in of AI, 2019 was a banner year for revenue cycles as they reckoned with a perfect storm of patient expectations, government rules, and more technology options than ever before.

Here are eight trends that HealthLeaders covered in 2019 that rocked the revenue cycle.

1. The transparency vs. estimates battle raged

Here's what everyone can agree on: Patients need more upfront information about their costs of care. In fact, a lack of price transparency is the biggest factor to a negative patient experience.

But the best way to accomplish that has become the subject of vigorous—and often contentious—debate. On the government side is the push for price transparency: Its final rule requires hospitals to provide patients with easily accessible information about standard changes for items and services offered.

But four major hospital associations—the American Hospital Association, Association of American Medical Colleges, Children's Hospital Association, and the Federation of American Hospitals—said in November they will file a lawsuit with member hospitals, arguing that the Trump administration exceeded its legal authority.

Such a rule also has the potential to cause confusion for patients, hospitals say. For instance, publishing a chargemaster might tick the price transparency box, but it's unlikely to be truly helpful.

"I would argue that it is almost useless information, and in fact, in many cases, is a disservice to patients because it's not what they would expect to pay in almost any scenario," Melissa Greer, vice president of revenue cycle at UCHealth in Colorado, told HealthLeaders. "Even a self-pay patient is given a fairly generous discount at each facility."

That's why health systems say they'd be better off providing patient-specific price estimates that take into account the patient's benefits, the specific procedure, the location of the treatment and other factors that impact the true out-of-pocket costs.

2. Surprise billing took a beating

As surprise, out-of-network billing further seeped its way into the mainstream news and consciousness, the national outrage grew, and lawmakers were spurred to act.

In mid-December, Congressional leaders announced the expansion of a bipartisan investigation into surprise billing practices to include physician staffing companies and health insurers.

During the same month, a Health Affairs study found that annual healthcare spending for patients with employer-sponsored health insurance would drop by $40 billion if specialists were not allowed to bill out-of-network.

That research was in line with the findings of a Kaiser Family Foundation report released in June which found that one in six Americans received a surprise medical bill in 2017 despite having commercial health insurance coverage. 

3. The front end becomes front loaded

"Never leave that till tomorrow which you can do today."

Yes, it's the stuff of motivational posters, but frontloading the front end as much as possible is a smart move.

Take Baylor Scott & White Health in Texas, which has been on a multiyear quest to optimize its revenue cycle with patient experience and efficiency in mind, specifically on the front end, so patients have all their financial ducks in a row before they even arrive for their appointment.

"We're trying to take care of as much of that process prior to care [as possible], so that on the day of [the patient's] service, it's more about healing and their well-being versus focusing on the financial aspects of that visit," Sarah Knodel, senior vice president of revenue cycle, told HealthLeaders.

Piedmont Healthcare took its front-end work a step further this summer with a new policy requiring some patients to pay 25% of their bill upfront, ahead of service.

Piedmont's vice president of revenue cycle Brian Unell told HealthLeaders that the policy is the third phase of a larger, multiyear front-end revamp, which has included price transparency and patient-centered scheduling, the latter of which increased point-of-service collections 19% last fiscal year and ~500% over the last six years.

4. Payer relations got reimagined

Payer-provider relations haven't exactly been chummy over the years, which is why it's exciting and encouraging to see new and innovative programs from payers that reimagine business as usual.

Perhaps the best example of this is the OODA Health partnership with BCBS of Arizona, Blue Cross of California and CommonSpirit Health Hospitals (Dignity Health).

The platform turns the provider-payer relationship on its head, with OODA paying the patient balance at the same time that the payer sends its payment to the provider. Then, instead of the provider billing the patient, OODA bills the patient on behalf of the payer.

2019 also saw the announcement that Humana Inc. and Epic Systems will collaborate to automate prior authorizations, send back claims information electronically, and integrate Humana's real-time benefits check tool, IntelligentRx, directly into Epic's e-prescribing workflow.

The collaboration has the potential to be "transformative" for the industry, Ryan Bohochik, Epic's director of value based care told HealthLeaders.

5. Patient-friendly payment plans proliferated

Patient out-of-pocket costs are skyrocketing, and outside players like WalmartSam's Club, and Amazon are enticing consumers with easily accessible, transparently priced, and budget-friendly healthcare services.

That's why revenue cycles are increasingly offering patient-friendly payment plans that improve loyalty, increase patients' likelihood to pay, and provide patients with a sense of control.

Although patient payment plans are nothing new, smart revenue cycles are making them easier to get, manage, and resolve, often without interest, and even for smaller dollar bills. Doing so can pay off for patients and health systems.

For instance, in the first 10 months of 2018, Inova Health System in Northern Virginia had over 3,000 payment plans initiated by patients. Compare that to the first 11 months of 2019, when more than 13,000 payment plans were initiated by patients.

The difference? A new interest-free payment plan program that the health system made available for patients with balances as low as $250.

6. The single business office took center stage

Whether you call it a single business office, a shared business office, or something else, more revenue cycles are moving toward the model of consolidating bills, phone numbers, and call centers.

And it's easy to see why. Just look at North Carolina–based Atrium Health, which converted two separate legacy financial systems to Epic and combined two separate call center teams and had record cash years every year since 2017, Chris Johnson, vice president of revenue cycle management for Atrium Health, told HealthLeaders.

In addition, in 2018, Atrium Health saved more than $732,000 in statement and postage processing by moving to a consolidated statement. Those savings came purely in raw costs, especially postage, and doesn’t include other factors like labor costs.

It also experienced increased efficiency in the customer service call center, allowing them to scale the size of the team to meet the new call demands. The organization used to receive 112,000–123,000 calls per month to the hospital (inpatient) and physician (outpatient) call centers combined. Now, after implementing single statements, the new call center receives 53,000–60,000 calls per month.

7. Automation reigned, AI made strides

Automating repetitive manual tasks has been a revenue cycle has been gaining momentum for many years, and this year was no exception. An additional wrinkle in 2019 was the skepticism and excitement that continues to swirl around artificial intelligence.

Although many revenue cycles are dipping their toes into the AI pond and some are finding success with it (like South Dakota­–based Avera Health, which uses AI-powered automation to follow up on the approved/denied status of outstanding claims to realize a $20.6 million accelerated cash flow within 18 months of implementation), others are taking a wait-and-see approach before jumping in.

There are also other forms of potentially revolutionary tech tools to consider, such as RPA, or robotic process automation, which takes automation to the next level by mimicking the way humans work.

HealthLeaders will continue to dig into AI in 2020, starting with a nuts-and-bolts, back-to-basics primer on what is, what it isn't, and how it can be put to work for the revenue cycle.

8. Valuing the employees that make the revenue cycle run

When automation frees up employees from mundane tasks, those employees will naturally take on more complex roles and responsibilities. That's why 2019 saw a renewed focus on valuing employees.

For Terri Meier, system director for patient revenue cycle at UC San Diego Health, forming a shared business office (SBO) was about more than consolidating call centers: It was also about empowering customer service representatives.

With that in mind, she rewrote the customer service job description, making it a more challenging and dynamic role. Now, the SBO staff are the highest paid in the revenue cycle.

"Customer service is the place on the career path that you want to go," she said during the Winter Revenue Cycle Exchange. "I'm really hiring knowledge workers."

Executives also place a high priority on flexibility, recognition, and rewards to maintain employee satisfaction.

For instance, the top request in employee surveys is the ability to work from home. Allowing employees to work at home has been a key driver of employee happiness for many revenue cycles, and many systems without the capability to allow some or all employees to work from home are in the process of implementing it now.

Alexandra Wilson Pecci is an editor for HealthLeaders.


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