Providers Adopting Advanced Revenue Cycle Management Capabilities

December 11, 2019 - The nation’s most wired provider organizations are investing in revenue cycle management capabilities in order to perform more advanced tasks, like real-time identification and value-based care condition tracking, according to a recent report from the College of Healthcare Information Management Executives (CHIME).

Earlier this year, CHIME released its annual Most Wired list, in which CHIME names the provider organizations demonstrating optimal use of information technology and surveys the organizations to better understand health IT investments and utilization of organizations at all stages of development. This year’s survey included 16,138 provider organizations, including hundreds of organizations earning awards for their health IT performance.

CHIME’s survey of this year’s participants revealed key changes in health IT implementation and utilization from 2018 and 2019, including major moves related to solutions for revenue cycle management.

The survey found that provider organizations are striving to implement revenue cycle management capabilities through health IT to accelerate the transition to value-based care. About one-quarter (26 percent) of the revenues from the Most Wired organizations came from an alternative payment model, including pay-for-performance arrangements, bundled payment models, and shares savings and/or losses contracts.

Fee-for-service, however, still dominated revenue streams, with 93 percent of participating organizations reporting the use of fee-for-service in some way. The remaining seven percent said they rely on government payments, donations, or other revenue sources.

CHIME researchers pointed out that fee-for-service may never completely go away, but the survey shows that provider organizations are working toward value-based care and reimbursement as evident by participant investments in new revenue cycle management capabilities in 2019.

The largest increases in adoption of revenue cycle and contract management capabilities from 2018 to 2019 included real-time identification and tracking of value-based care conditions (up 11 percentage points) and the distribution and management of bundled payments (up 8 points).

Other revenue cycle and contract management capabilities experiencing more modest increases in adoption during the period included reconciliation of patient charges/accounts according to insurance agreements (up 8 percentage points) and calculations of total cost-of-care across care settings (up 3 points).

The ability to retroactively analyze care improvements and cost reductions and aggregate charges did not see significant attention from 2018 to 2019, the survey found. However, 78 percent of provider organizations in the survey said they already have retroactive analysis capabilities. About 63 percent also said they could perform charge aggregation, including bunding for different payers.

The ability to calculate total cost-of-care across care settings also had high adoption by 2019, with 72 percent of provider organizations having this capability, according to the survey. Approximately 67 percent of participants could also reconcile patient charges/accounts according to insurance agreements by the end of the period.

Many, if not all, of these revenue cycle and contract management capabilities are key to successfully transitioning away from fee-for-service, which industry leaders believe leads to worse patient outcomes and higher costs.

Adoption of the key capabilities is on the rise, with each capability experiencing some increase from 2018 to 2019. However, CHIME researchers stated that “adoption is still insufficient to drive significant market changes.”

Another health IT capability revenue cycle leaders are lagging in is price transparency, the survey showed.

Federal and state governments are pushing provider organizations to make their prices more accessible to patients in order to empower consumers to shop around for the best valued care. CMS even requires hospitals to publish their chargemaster prices online and will soon require the organizations to post their payer-specific negotiated rates.

However, the ability to offer price transparency is still in its infancy, CHIME reported. The survey found that 80 percent of participating provider organizations could provide price lists for their procedures and services, but only 36 percent could offer three or more of the price transparency capabilities tracked by the Most Wired survey, including defining key terms for patients (27 percent), cost-burden estimation based on insurance type (27 percent), and education regarding capabilities (27 percent).

Even fewer organizations could offer price comparison or filtering according to procedure or service (25 percent), hospital or health system (13 percent), insurance network (12 percent), insurance plan or type (12 percent), region (11 percent), or clinician (5 percent). And more provider organizations reported having no price transparency capabilities available (16 percent) than having the price comparison capabilities mentioned previously.

Value-based care and price transparency were two of the top trends in healthcare in 2019. Industry leaders are aggressively pushing providers to take on both capabilities in order to improve patient outcomes and population health while reducing the unsustainable trajectory of healthcare costs. At this point, however, providers still have a way to go with implementing both.