When embarking on a revenue cycle automation project, it's prudent to crawl before you walk and then walk before you run.
At hospitals and health systems across the country, revenue cycle executives are primarily concerned with ensuring the financial health of the organization. Between managing prior authorization so patients can receive timely care and handling denial claims and navigating new payment models, hospitals are constantly a work in progress on the revenue cycle management side. The job of revenue cycle leaders has grown more challenging year by year and many are searching for ways to optimize RCM processes to achieve greater efficiencies.
Throughout the COVID-19 pandemic, there has been a growing interest in robotic process automation (RPA) solutions due to a larger backlog of work coupled with staff shortages. In navigating a fluid dynamic for the financial health of the organization, it's important for leaders to have the right tools and data analytics to accomplish the tasks at hand, but more importantly, it’s imperative to have the right implementation strategy in place. When embarking on a revenue cycle automation project, it's prudent to crawl before you walk and then walk before you run.
The phased-in approach
The most strategic RPA or Intelligent Process Automation (IPA) implementation process is a phased-in approach that can deliver sizable financial returns that offer provider organizations the opportunity to reinvest the returns for further automation opportunities down the line. The staggered process assists cash-strapped hospitals and offers a smooth cultural transition for change-adverse health systems.
It’s imperative that the software you choose is agnostic and can overlay on existing RPA investments. Also, the software firm you choose should tailor the IPA to the individual hospital's system to ensure that the deployment strategy fits the goals of the organization, including customized road mapping for the specific sequence and implementation timing of automation.
Financially speaking, one of IPA's most appealing qualities is the consistency with which it can turn nominal initial investments into meaningful long-term returns. According to a McKinsey report, automation of 50% to 70% of tasks results in a triple-digit return on investment, while a KPMG study of financial services firms found that RPA can cut costs by up to 75%.
“Show me the money”
In a hypothetical analysis for a standalone 650-bed hospital, offloading manual work from four areas of RCM resulted in a net benefit of $4.5 million.
A typical deployment period takes place over the course of 18 months, requires just $130,000 in initial cash outlays, which account for the implementation fee and the first four months of subscription for authorization automation and delivers an ROI of 3.5-4.5 times the initial investment plus SaaS subscription for the hypothetical hospital.
Customizing RPA change management
Beyond the enticing financial returns, what all executives should be seeking out for their respective provider organizations are RCM solutions that offer flexibility in relation to digital transformation. It’s not easy to make a significant change to a function so crucial to your business's bottom line, which is why any meaningful IPA or RPA solution needs to factor in the ease of service and a lowered cost point. Every hospital and health system is unique in terms of the challenges they face in the RCM space and thus deserves a customized deployment roadmap that outlines which automations get implemented and when that occurs.
Factors that can influence the customized roadmap include individual departmental deficiencies, human capital allocations, and current initiatives pursued by the system. There is no one-size-fits-all approach to enhancing RCM and that’s a primary reason a thoughtful RPA-based strategy is worthy of consideration. However, it’s also not enough to simply offer the solution and walk away; RPA implementation must also include transparent analytics capabilities to ensure accountability. Hospitals should be able to easily look at a dashboard and evaluate how their new RPA functionalities are performing.
Additionally, if a hospital is dissatisfied with the performance of its RPA strategy, the software should allow leaders to make easy adjustments at the click of a button. Given what provider organizations have been through during the past 18 months, there should be a greater push to help lift the administrative responsibilities and create better efficiencies in healthcare finance.
By pursuing the promise of RPA in RCM, hospitals are presented with a resource reallocation opportunity that is sustainable in the long-term, can produce greater ROI than the current approach, and free up human capital to address more pressing matters. Hospitals should be focused on delivering high-quality care to their patients and the untapped potential of RPA to streamline challenges in the RCM space frees up providers to do just that.
Terry Blessing III is SVP of Client Development at VisiQuate, healthcare revenue cycle management, data and analytics company.