- Fewer healthcare organizations are increasing their revenue cycle IT budgets compared to last year, a new survey shows.
The annual Healthcare Financial Management Association (HFMA) and Navigant survey of 107 hospital and health system CFOs and revenue cycle management executives showed that 68 percent of organizations plan to increase revenue cycle IT budgets in 2018.
The number of organizations planning to boost their revenue cycle IT investments, however, is down from almost three-quarters of organizations in 2017.
Compared to the last year, the survey also showed that 39 percent fewer executives predict a revenue cycle IT budget increase of over five percent in 2018. And 53 percent more executives project no change in their revenue cycle IT budgets.
But the leveling out of revenue cycle IT spending in 2018 does not indicate that hospitals and health systems are satisfied with their current technologies, Navigant and HFMA stated.
Optimizing revenue cycle-related EHR functions is still a major challenge for hospitals and health systems, executives reported. Over one-half of respondents (56 percent) said the challenges of adopting revenue cycle management capabilities in the EHR system was equal to or outweighed the benefits of integration.
Hospital-based and small hospital executives reported more challenges than benefits with revenue cycle management adoption in the EHR. Nearly one-quarter of hospital-based leaders (24 percent) experienced more challenges compared to 16 percent of health system executives, and about 27 percent of small hospital executives reported more challenges versus 16 percent of large hospital respondents.
Moreover, hospitals and health systems are still struggling to optimize EHR functions overall. The survey uncovered that 56 percent of executives cannot keep up with EHR upgrades or underutilize available EHR functions.
“Hospitals and health systems have invested a significant amount of time and money into their EHRs, but the technology’s complexity is preventing them from realizing an immediate return on their investments,” Timothy Kinney, Managing Director at Navigant, stated in a press release. “When optimized correctly, a good portion of the ROI can come from EHR-related revenue cycle process improvements.”
Consumer self-pay strategies also continue to be a challenge for hospitals and health systems, the survey revealed.
Fewer respondents believe consumer self-pay will significantly impact their hospital or health system in 2018 compared to the previous year. However, 81 percent of executives still expect patient financial responsibility to affect their organization.
Most hospital and health system leaders (59 percent) said consumer self-pay will have a moderate impact on their organization. And 22 percent said patient financial responsibility would have a significant impact versus 40 percent in the 2017 survey.
Consumer self-pay is expected to affect health systems and large hospitals more than their peers. One-third of health system executives said consumer self-pay will have a significant impact compared to just 18 percent of hospital-based executives. About 29 percent of large hospital leaders also said consumer self-pay will significantly affect their organization versus 18 percent of leaders from smaller hospitals.
Hospitals and health systems may be getting better at managing consumer self-pay, but more work remains, Navigant Managing Director James McHugh explained.
“The impact of consumer self-pay on providers will only increase with the popularity of high-deductible health plans and negative changes to the economy,” he said. “Providers must take advantage of opportunities to more holistically educate patients on out-of-pocket costs, predict their propensity to pay as early as possible, and secure alternative payers or financing when needed.”
With revenue cycle challenges persisting, executives plan to realize revenue cycle management improvements through technology and revenue integrity.
Revenue cycle IT budget growth may be slowing, but technology will be the biggest drive of revenue cycle management improvements, survey respondents agreed. About 76 percent of the revenue cycle management capabilities or tactics hospitals and health systems plan to focus on for improvement over the next year involved or are enabled by technology.
Revenue integrity strategies will also drive improvements. Revenue integrity was the top strategy hospitals and health systems plan to implement to improve revenue cycle management over the next year, with 24 percent of respondents.
Hospital and health systems also prioritized revenue integrity in 2017. The strategy was number one for revenue cycle management improvement in last year’s survey.
Executives project revenue integrity implementation to reduce compliance risks and boost revenue capture and net collection, HFMA and Navigant explained.
EHR optimization was the second top strategy for revenue cycle management improvement with 21 percent of respondents, followed by physician/clinician documentation with 12 percent and self-pay management with 11 percent.
Compared to 2017, EHR optimization rose as an improvement strategy while physician documentation fell.