Recently, leaders from across the nonprofit healthcare revenue cycle spectrum met in North Carolina for the annual HealthLeaders Revenue Cycle Technology Exchange.
The group collectively discussed the pervasive trends and inefficiencies they experience firsthand every day and collaborated on possible paths forward for the industry.
As a part of the two-day event, Bank of America hosted a closed-door session with select leaders who shared a common set of observations, challenges and goals as they position their organizations for the future. Key themes included:
The evolution of healthcare’s “digital front door”
Creating equal footing with payers
Building vs. buying technology
In today’s interview, we sit down with the moderator of this closed-door session, Bank of America’s National Client Solution Executive, Simon Abtalion.
Q: As we started our chat, you mentioned the term “digital front door.” Can you define the concept and share why it was such an important topic amongst participants?
The digital front door is an expansive concept that encapsulates healthcare’s migration from paper forms and telephone calls to more convenient channels such as patient-driven scheduling, mobile check- in, digital appointment reminders and text-to-pay options. In short, it’s the suite of technology that providers leverage to improve the patient experience. While this isn’t a new concept, it’s one that has certainly become a greater focal point as margins compress, competition rises and the patient has become more empowered. Not only should it improve the patient experience and, as such, drive greater loyalty, but when appropriately deployed it should lower the hard cost incurred by an organization through process improvement and a reduction in human intervention.
Q: Does this process force a change to those patients who prefer talking to someone or are more comfortable with a physical form?
While cost control and automation are by-products of the application of a successful digital front door, the intent is to meet each patient via the channel/methodology where they are most comfortable. Keeping this in mind, it’s less about taking an option away from a patient, and far more around providing choice knowing that one size doesn’t fit all. An interesting tertiary aspect is that of “future proofing,” with the digital front door laying the foundation for the incoming generations, as they become a larger percentage of the patient base, who are far less accustomed to paper and more comfortable with digital channels.
Q: What does equal footing mean? Are payers and providers at odds with one another?
Every leader at our session, and within the wider Exchange, expressed frustration with the payer/provider dynamic. Many lamented over AI and algorithmic case/claim reviews applied by payers leading to increased denials and a cumbersome process to appeal and resubmit. To combat this growing challenge, organizations have been looking to deploy technology to improve repetitive tasks, thus freeing up their staff for high-level functions, but their ability to do so is not in line with their national payer counterparts. Each of the big four national healthcare payers collects over $30 billion in total direct premiums per year, while the net patient revenue of the health system looking to partner with them is often but a fraction of that size. This wide divide in revenue leads to a misalignment of scale, from tech budgets to human capital, and leads to a challenged relationship with the provider constantly looking to catch up.
Q: Have the buying habits of revenue cycle leaders changed? If so, how? What prompted this change?
Revenue cycle leaders are challenged to maintain a high- efficiency process while controlling cost and deploying new technology to solve operational issues, and this is nothing new. However, high-functioning organizations have taken a new approach to the vendor selection process. For those organizations, gone are the days that a single treasury, finance or revenue cycle leader makes a buying decision as today’s model has information technology, end user, patient experience, revenue cycle, treasury and finance all at the table with a voice. In a particular case, it was shared that one large organization encourages each of these groups to have a series of separate meetings with each vendor and the vendor that scores best across all groups is the one selected, and this may not be the first-choice vendor from the revenue cycle. This cross-functional approach ensures that the technology chosen represents the diverse needs of a multitude of stakeholders.
Q: I continue to hear the term “native functionality.” Can you define that and share the participants’ views?
Native functionality can be reduced to the concept of a module, or addition to a technology platform, that seamlessly integrates. Meaning it doesn’t require a second screen, separate log-in, additional user interface, end-of-day file upload, nor delayto processing. This is often used when describing revenue cycle functionality within a healthcare practice management solution. To reduce friction and improve end-user experience, many organizations have long preferred a native functionality. However, many leaders in our session voiced that they may have needs that a practice management solution provider has yetto satisfy or has not addressed in as complete a manner as an outside healthcare fintech has, and therefore they are forced to go “outside” to get the tools they need. Weighing this balance between functionality and integration is a crucial aspect of the modern revenue cycle leader.
Contact Simon to discuss these topics or ways we can help.
The United States economy faces mounting uncertainty and multifaceted pressures, leading to disruption and a challenged outlook on the future. Health systems are far from immune, and their leadership feels an increased burden as they prepare to, once again, navigate unchartered waters.
During a closed-door session held in northern California during the 2023 HealthLeaders CFO exchange, the financial stewards of our nation’s largest systems shared their concerns, plans and observations with Bank of America, collectively discussing strategies to address the four most pressing headwinds facing the provider space today:
Competitive pressures from new entrants to the care delivery space
Controlling costs
Evaluating, deploying and managing new disruptive technology
Recruiting, training and retaining talent
Simon Abtalion, National Client Solution Executive, Global Commercial Banking at Bank of America, shares key conclusions from this conversation.
Q: How has the competitive landscape changed?
Abtalion: Traditionally, providers competed for patients largely based on location and quality of care. With increased transparency driven by patient protection legislation and more readily available pricing information, cost is a new driver. Another factor in the competitive landscape is new entrants to the space — retail giants are directly entering the home care, telehealth and in-person clinic spaces, which is forcing traditional healthcare providers to adjust their strategies to retain patient flow in critical areas. Featuring an already retail experience, strong consumer penetration rates and tremendous size and scale, national retailers have focused expansion into healthcare on: primary and urgent care, labs, X-rays, EKGs, behavioral health and dental. These are all positioned to continue to be a disruptive force to the bottom line of traditional providers as they challenge them for patients, both in person and virtually.
Q: What factors are leading to the heightened focus on cost control?
Abtalion: A recent report issued by the American Hospital Association (AHA) shared that hospital patients are sicker and more medically complex than they were pre-pandemic. I stress, hospital, meaning general lower-acuity activities are being siphoned off by new entrants to the space, leaving high-acuity patients with traditional providers (hospitals). This evolving dynamic creates challenges to provider revenue forecasts, as delivering this type of care is subject to the high costs of labor, drugs and supplies.
In short, the cost of treating patients is on the rise and there are fewer revenue streams to offset. This shift, coupled with the mounting financing burden driven by economy-wide inflation and reimbursement shortfalls, is threatening the financial stability of hospitals nationally.
Q: Healthcare as a percentage of Gross Domestic Product continues to increase. What are the drivers?
Abtalion: CMS publishes interesting statics on this annually. Most recently, it shared that the U.S. National Health Expenditures (NHE), which include private and public spending on healthcare, are expected to eclipse $4.6 trillion or $13,998 per person in 2023 and grow to $7.2 trillion or $20,425 per person by 2031. The largest increase to spend nationally has been by the federal government, which increased spend via Medicaid, provider assistance and public health spending throughout the pandemic. While national debt, inflation and foreign policy continue to put a strain on government spending, the AHA has asked for additional relief above and beyond the provider relief funds to help address workforce shortages, labor cost and reimbursement rates that have not kept up with inflation.
Q: Is technology the answer to controlling cost? What solutions were most talked about?
Abtalion: Technology is an answer, but with it come additional questions and considerations. First and foremost, healthcare technology, or healthtech, has limitless applications focused on every element of the healthcare ecosystem — from telehealth to leveraging robotics in care delivery. While clinical applications are exciting, our focus was on the financial elements. We heard leaders discuss the evolving role that artificial intelligence (AI), robotic process automation (RPA) and machine learning (ML) play in their revenue cycle. It became evident there is an “S” curve of adoption, with many organizations still searching for the right fit and governance for emerging technology.
For the forward-thinking leaders that have empowered their treasury, finance and revenue cycle functions to transform through technology, we found that automated coding, document improvement and addressing the challenges associated with prior authorization were prevalent applications. Automating repetitive manual tasks enables organizations to reduce cost and free up human resources for higher-level pursuits.
Q: How has the talent conversation changed within healthcare?
Abtalion: The war on talent in healthcare has reached the level of critical concern in recent years and it does not appear that relief is coming. As a result, the risks have never been greater for healthcare systems and their patients. During our conversations, leaders shared their concerns over the rising cost of talent (traveling nurses topping that list), the nurse shortage, and even shared that, according to a recent study from the Advisory Board, hospitals lose an average of $90,000 per day in revenue when the facility is understaffed.
Once critical talent is attracted, new challenges such as retention and integration become a major focus. Strategies must be deployed across job functions to keep staffing at an acceptable level, while also providing clear career paths, training and compensation. Leaders are also looking to maintain and create culture in a remote environment, often with frequent changes
Healthcare technology, or healthtech, has limitless applications focused on every element of the healthcare ecosystem — from telehealth to leveraging robotics in care delivery.
The digital front door is an expansive concept that encapsulates healthcare’s migration from paper forms and telephone calls to more convenient channels such as patient-driven scheduling, mobile check- in, digital appointment reminders and text-to-pay options. In short, it’s the suite of technology that providers leverage to improve the patient experience. While this isn’t a new concept, it’s one that has certainly become a greater focal point as margins compress, competition rises and the patient has become more empowered. Not only should it improve the patient experience and, as such, drive greater loyalty, but when appropriately deployed it should lower the hard cost incurred by an organization through process improvement and a reduction in human intervention.