What Percentage of Hospitals are without an effective RCM System?

A Black Book survey was conducted to gauge the effectiveness of the RCM systems of hospitals. It was revealed that 26% of hospitals do not have a sound RCM solution in place.

The Survey Results

Five hundred and twenty-two hospitals and 4,640 people were surveyed about their use of 165 RCM systems. While the survey reflected that improvements are being made in RCM in some hospitals, in others, no workable solutions persist.

When you solely review the fact that 26 percent of healthcare facilities don’t plan to improve or optimize their RCM solutions, things may seem troubling. However, one must also remember, that this value has decreased from 35 percent in 2012.

Moreover, there is excellent potential for improving healthcare RCM solutions. While there are 1,600 hospitals without any RCM optimization plan in place currently, out of them, 82 percent of these hospitals plan to transform to value-based reimbursements in 2019.

The rise of value-based reimbursement.

Slowly, value-based reimbursement is taking over the conventional fee-for-service system. In 2016, 29 percent of healthcare payments were done by this alternative payment mode as reported by Learning and Action Network.

As private and public payers continue to try and improve the quality of care while aiming to reduce cost, value-based reimbursement payments are likely to increase.

By adopting an effective RCM solution, hospitals can easily make the transition from a fee-for-service model to value-based reimbursement.

As per a Research Director of Payer Health at IDC Health Insights, the key is for healthcare providers to use analytics to gauge clinical and financial data in an attempt to find ways of improving quality of care.

Unless an effective revenue cycle management process is in place, hospitals will lose out on revenues while transitioning to a value-based reimbursement model. This is because such a solution can ensure that both providers and consumers can contribute to the transition.

As per the survey conducted, 85 percent of the respondents agreed to partner with RCM consultants in an attempt to deliver direction to the providers in the short-term. In the long-run, partnerships with vendors will be required for the effective implementation of an RCM solution.

What should the hospitals do?

There are two approaches hospitals can take. Either they can invest in core platforms that deliver enterprise functions. Or they can use a mixture of automated components and bolt-on solutions.

Currently, the latter is being used by most hospitals. Over 45 percent of the surveyed hospitals use or plan to use bolt-on solutions for their RCM. Only a few are expected to make use of a core vendor as of now.

This is mainly because of the staffing concerns that most hospitals have. It isn’t easy to find highly skilled RCM human capital. Hence, hospitals make do with bolt-on automated solutions instead.

Conclusion

Regardless of how hospitals plan to do it, the fact remains that if they wish to transition to the value-based reimbursement model, they must begin by improving their current RCM systems.

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