- Black Book Market researchers ranked Cerner Business Office Services as the top rated end-to-end physician revenue cycle management outsourcing vendor. Cerner earned high marks on eighteen key performance indicators relating to client experience and provider satisfaction, according to the 2016 Revenue Cycle Management Survey.
Rounding out the top vendor list was NextGen, Allscripts, Intermedix, Convergent, Conifer Health, AmazingCharts, and Kareo. All of these revenue cycle management outsourcing vendors ranked highly in customer approval and loyalty, stated the survey.
The survey of 2,000 independent physician practices and 200 hospital-based organizations suggested that more providers, especially those in small practices, may soon be looking to Cerner and other top ranked vendors for revenue cycle management solutions. Black Book researchers projected medical business office outsourcing to increase 30 percent in the next year among practices with 25 physicians or fewer.
The push for revenue cycle management outsourcing is primarily driven by declining claims reimbursement rates and value-based care models, stated the report. In light of falling revenues, 59 percent of medical providers and 86 percent of hospitals said that their organizations plan to eliminate medical billing processes that are resource-intensive, error prone, manual, and back-end by the third quarter of 2017.
Approximately 90 percent of small, independent physician practices also stated that they are not prepared financially or technically for the challenges of transitioning to value-based reimbursement arrangements.
“Rising healthcare expenditures and the complex technology or staffing requirements to succeed under value-based care is creating the urgent demand for cost-effective, technically advanced business office outsourcing solutions in physician practices across the country,” stated Doug Brown, Managing Partner of Black Book.
Physicians, practice administrators, and corporate financial leaders also pinpointed five other factors that caused their organizations to consider revenue cycle management and medical billing outsourcing, including inefficient billing processes, high staff turnover rates, lack of health IT know-how, stress of financial and staff management, and declines in direct patient care time.
Some healthcare leaders looked to medical billing outsourcing to make their practices more efficient. Ninety-six percent of practice leaders felt that their medical billing processes were inefficient and all practices considering outsourcing faced a drop in collections and increase in time to collect in 2016.
However, 82 percent of practices that recently elected to outsource business office services in the third quarter of 2015 experienced a decline in the number of rejected claims and the time it takes to collect payments from payers during the first two months after outsourcing implementation.
Healthcare employment challenges also spurred organizations to outsource medical billing processes. Ninety-seven percent of independent groups and solo practices reported high business staff turnover rates and 83 percent of hospital-based physicians said they had difficulties recruiting business office personnel that had experience with ICD-10, value-based care, risk contracting, and MACRA.
“Turnover in a provider’s billing department is especially damaging,” the press release stated. “Claim processing is the economic life blood of a practice and a new addition or replacement in the billing department inevitably leads to slowdown in the processing of claims.”
Outsourcing some medical billing processes helped to remove business staffing issues from a healthcare organization’s top priority list. Eighty-one percent of providers with new outsourcing contracts stated that staffing problems dropped from their list of high-impact problems almost immediately.
In addition, many small practices considered medical billing outsourcing to better handle technological issues. Ninety-five percent of practices with less than five physicians identified their organization as “not tech savvy.” But outsourcing vendors had the potential to manage technological investments, training, and software updates as well as technical issues, the survey explained.
Many new physicians also turned to revenue cycle management outsourcing as a way to alleviate the stresses of managing business office functions. All of the 224 new physicians in the survey reported that they are seeking alternatives to office financial and staff management as they open their own practices.
“Outsourcing their billing right out of the gate is giving the new generation of physicians and practitioners the much needed relief from the day-to-day stress of launching a new practice, without a trial by fire in hiring, training and managing employees,” Black Book explained.
Additionally, some providers are seeking outsourcing solutions to help them spend more time on patient care. About 77 percent of physicians reported that they want to allocate time spent on business office-related functions to direct patient contact.
While some providers were considering outsourcing solutions, the survey showed that many healthcare organizations have already started outsourcing implementation in the past year. Almost 88 percent of groups of 100 or more practitioners are currently implementing “partial to full managed business office services providing outsourced front, mid-process and back end related services to large clinic, multi-specialty groups, and complex physician organization market.”
With more organizations implementing and looking to implement outsourcing services, Black Book researchers predicted that the physician and ambulatory revenue cycle management outsourcing and extended business office services markets will see a 42 percent growth rate between the fourth quarter of 2016 and the first quarter of 2019.