How automation is optimizing revenue cycle operations, lowering costs, and improving the payment experience for both employees and patients
With margins tightening and payment collection getting trickier by the day, hospital CFOs have no choice but to be more strategic about how they manage payer, vendor, and patient payments. That’s where automation and AI come in—helping to cut down on manual work, speed up payment cycles, and give financial performance a much-needed boost.
“Revenue cycle optimization is one of those areas where hospitals can take control. It’s a major opportunity to run more efficiently, especially as the cost to collect continues to rise,” says Tom Priedeman, division manager for middle market healthcare at U.S. Bank.
While progress has been made in digitizing parts of the payment and cash posting process, many workflows remain highly manual. Moreover, nearly a third of patients continue to pay by check, which slows collections and adds unnecessary administrative burden. Below, Priedeman breaks down where providers are seeing the most friction—and how automation and advanced solutions are providing hospitals with a smarter path forward.
Q: What are the most pressing revenue cycle challenges facing hospital CFOs today?
Priedeman:
It really comes down to a combination of pressures—reimbursement challenges, payer rate negotiations, labor costs, and inflation. Hospitals have limited levers to protect margins, and the financial profiles of many systems have shifted significantly in the last few years. That’s why we often say, “control the controllables.” And revenue cycle is a big part of that. Manual processes, legacy systems, and denial management can become enormous time drains, and they increase the cost to collect.
What’s amazing is that about 30% of patients still mail in checks. We’re not where we hoped we’d be with payment digitization. Although the tools are available, not all patients—or hospitals—are fully on board. At the same time, EHR migrations continue to demand attention and capital, pulling focus away from payment transformation. But with these technology upgrades, it’s critical to have strong core systems in place. That’s why we often recommend using the time during these upgrades to reassess payment rails and revenue cycle components across the organization.
Q: How does AI and other automation improve the efficiency and effectiveness of payments for both patients and providers?
Priedeman: AI is everywhere right now—but I’m particularly excited about its application in the provider setting, especially within revenue cycle management (RCM). It has the potential to transform denial management, payment posting, and reconciliation—all of which are traditionally manual, time-consuming tasks. AI is bringing real value by automating tasks such as converting ERAs and electronically posting those payments. As these tools become more advanced, with more logic and reasoning, they’ll continue to improve payment processes. We’re already starting to see this in many of our own solutions.
On the patient side, the stakes are high as well. AI is already starting to change that dynamic. Improving the patient payment experience, in particular, presents a clear opportunity to support healthier cash flow. Only 8% of patients believe healthcare makes the payment process easy. Some are even willing to switch providers over it. However, we see this as a relatively easy fix. Our goal is to meet the patient where they like to pay, versus dictating how they pay. We’re focused on providing patient-friendly billing options, including mobile apps and text-to-pay. In turn, this helps drive a quicker cash conversion cycle for providers and ultimately reducing the time it takes to collect payment.
Q: What’s standing in the way of faster adoption?
Priedeman: There are three big barriers: system integration, internal bandwidth, and limited awareness. When we think about automation, a key component is having fully integrated systems working behind the scenes. The challenge for hospitals is that they face the complex task of integrating multiple EHRs. Secondly, providers want to innovate when it comes to payment transformation, but their teams are stretched. There are competing priorities, and they often lack the time and resources to implement new initiatives. Lack of knowledge about payment technologies is another concern. Finance leaders aren’t always aware of the full range of solutions available across the healthcare payment ecosystem, or which vendors are best positioned to help. We’ve built a great platform that embeds within EHRs—but getting that message out is half the battle.
Q: What benefits does automation offer beyond dollars and cents?
Priedeman: Reducing staff burnout is a big one. Automating low-value, repetitive, tasks is crucial, especially since those manual processes are rarely enjoyable but often necessary. On the patient side, offering omnichannel payment options that align with their expectations can significantly improve the overall experience. Operationally, automation also reduces errors, resulting in greater efficiency across departments. It’s not just about cutting costs; it’s about tightening the process from end to end.
Priedeman closed on an optimistic note. “It’s exciting to see how much smarter payment tools are getting—and how quickly hospitals can benefit,” he says. “Whether it’s supporting EHR integration or helping hospitals think through how they collect and process payments, we’ve had the opportunity to work with more than 900 hospitals and health systems across the country. Sometimes it just takes a different perspective to realize there’s a better way.”
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