Is it Time for a New Outsourcing Model in Healthcare?

Fully managed hybrid outsourcing solutions are gaining traction given labor shortages and financial pressures

Hospitals and provider organizations continue to struggle with staffing shortages across multiple departments. One of the hardest-hit areas is the revenue cycle. A recent poll of medical group leaders found that coders were the most challenging role to fill, followed by billers, schedulers, and authorization specialists. Credentialing and patient engagement positions were also on the list. This may be why more providers are turning to revenue cycle outsourcers.

A survey conducted in April of 2023 asked revenue cycle leaders which processes they were outsourcing or planning to outsource over the next 12 months. The top processes considered for outsourcing are authorization and medical necessity (19%), denials and appeals management (18%), and underpayment analysis and recovery (18%).

Barriers to outsourcing

One of the challenges of outsourcing is cost, especially given current inflation levels. Adding another outsourcer, no matter the benefits, may seem out of reach for provider organizations experiencing shrinking operating margins. But it doesn’t have to be.

Hybrid global outsourcing models and commercial flexibility

With outsourced models, organizations benefit from staffing relief and best of breed technology capabilities. Rather than building teams and systems in-house, outsourcing allows leaders to quickly access essential resources.

Today’s offshore medical coders are often fully certified by U.S. associations AHIMA and AAPC.

Now enter the global outsourced model, where organizations can leverage the value of offshore resources and pair it with onshore oversight. This hybrid model helps providers and staff better focus on enhancing care delivery and the patient experience.

Furthermore, innovative commercial arrangements through fully managed outsourced models can help control spending. Aligning on KPIs helps hold the outsourcing partner accountable for delivering improved outcomes.

Five functions ideal for hybrid outsourcing

1. Claims management and billing. Many outsourcers leverage advanced technologies like artificial intelligence (AI), machine learning (ML), robotic process automation (RPA), and natural language processing (NLP)—capabilities for which many health systems do not have internal resources to implement or manage. These technologies streamline workflows and help deliver more accurate coding, reducing denials and write-offs while improving cash flow and timely reimbursement.
2. Payment posting and reconciliation. Today’s outsourcers use automation technology such as AI and intelligent character recognition. These technologies can take much of the manual element out of the process, thereby improving accuracy, staff productivity, and turnaround times. This, in turn, reduces A/R days and optimizes cash flow.
3. A/R management and collections. Global outsourcers have revenue cycle experts with extensive experience in payer requirements and U.S. regulations. They understand the complex nature of A/R management and collections and how to collaborate with payers on the provider’s behalf, creating specific standard operating procedures with their clients.
4. Denials and appeals management. Hybrid outsourcers can use automated workflow tools to streamline denial management and appeals. Using BOTs, they can automate the appeals process to improve revenue reconciliation. The most effective partners use predictive models to prevent similar denials in the future. Outsourcing denials and appeals can eliminate backlogs so onsite staff can focus on more strategic tasks.
5. Underpayment and recovery. Some global outsourcing firms have entire teams focused solely on underpayment recovery. They understand payer contracts and discrepancies and can cross-verify payer fee schedules and calculate accurate reimbursements. The best partners will be able to identify underpayment causes and help providers create a strategy to reduce them in the future.

Clinical outsourcing opportunities

In addition to revenue cycle management, many outsourcers offer services that can help reduce clinician burnout. Managing clinician inbox messages from patients is a prime example. With the vast adoption of patient portals, clinicians can receive more than 100 messages in a single day. They now spend hours answering emails, processing prescription requests, making referrals, and more. Adopting a hybrid outsourcing model with virtual nurses paired with onshore oversight can reduce stress on clinicians while also improving the patient experience.

Offshore registered nurses can be fully credentialed and licensed in the U.S.

Licensed offshore virtual nurses can respond to visit follow-up questions, assess patient symptoms, and route urgent messages to the appropriate provider. They can also refill prescriptions, answer non-urgent medical questions, and schedule appointments and referrals. Clinicians can focus on direct patient interactions while patients receive more timely responses.

The bottom line

No matter how hard they might try, health systems cannot hire their way out of their current staffing challenges. Now is the time to consider a new model for outsourcing, leveraging a global, end-to-end delivery approach.