This year (2015) has begun with changes such as reduced reimbursements, cost effective payment reform, transition to ICD-10 coding, the Affordable Care Act (ACA) and increased self-pay collection costs, all contributing to the shrinking bottomline for healthcare providers. American Medical Association (AMA) and RAND recently conducted a joint study titled "Effects of Health Care Payment Models on Physician Practice in the United States". As per its findings, physician practices are getting affected in more than one ways in implementing the new payment models by healthcare payers. Even according to the Black Book survey, 61% expect to lose their jobs by 2016 if they do not adjust their clinic/ hospital revenue cycle management to the new payment models.
Payment reform is a strategic move to revolutionize health care for a value-driven delivery system. The new payment models consist of fee for service, pay for coordination, pay for performance, episode or bundled payment, and comprehensive care or total cost of care payment. No one payment model can be applied to all care types, environments, practice types or geographic areas. Not to mention, there are many major challenges in the path of reforming any clinic or hospital revenue cycle, including the need for substantial investments to maintain rising amounts of data, various programs, and spectrum of metrics.
Ever since the Affordable Care Act has come into effect, insurance coverage has increased with not less than 17 million people getting enrolled by early this year. The payment reform necessitates new documentation requirements for each new enrollment with healthcare payers, which invites significant expenditure in data management. Heavy investment is also involved in procuring a sophisticated information systems to better leverage computerized health records. To top it up, delegation of non-core tasks further increase administrative burden of the provider's office. As the operational details and context of new payment models are significant to improve the effectiveness of the models, availability of clean and authenticated data and resources are required for data management and analysis. Key performance measures also need to be harmonized.
One of the options to keep physicians' practices solvent and combat the pressure on clinic/ hospital revenue cycle, is to change the organizational model. As a result, some of the clinics/ hospitals are found seeking consolidation, partnering or merging with other hospitals. Thus, the clinics/ hospitals seek support in the substantial investments required to meet payment reforms or use the other hospital’s revenue cycle infrastructure.
Another viable option is outsourcing hospital's RCM to one of the reliable medical billing services. Outsourcing has become a trend as a result of its impact on the healthcare providers' bottom-line. Interestingly, Black Book Market Research cites, “It has been no surprise that many overwhelmed hospital leaders have realized that RCM isn’t their organization’s core competency and have turned to large end-to-end outsourcing firms for RCM to refocus on patient care and clinical service delivery”.
In fact, many healthcare providers nowadays are outsourcing their RCM to medical billing services to avoid the capital cost of updating the system, analytics software technology and also to gain immediate access to highly-skilled and expert personnel. As per the recent Black Book survey, 90% of the CFO opted to outsource because of resource constraints. 80% and plus hospitals with less than 200 beds experienced revenue increases in 2014 with 5% average growth due to outsourcing. This was even higher with larger hospitals.
MedicalBillersandCoders is a qualified and experienced medical billing service that offers end-to-end revenue cycle management for physicians and ensures accurate claims entries for minimum denials and A/R follow up.