Health Data Management
It can be tempting to deprioritize revenue cycle management (RCM) planning efforts during a new IT system implementation because of patients’ limited direct interaction with the revenue cycle compared to other health system functions. Unlike the immediacy of an EHR problem affecting patient care, back-end issues are typically less urgent. However, the accumulation of unresolved problems delayed until after go-live, compounded by the substantial expenses associated with implementing a new IT system, can be the “death by a thousand cuts” that causes serious financial distress. The negative impact a system implementation can have on an organization’s finances has only been reinforced by the latest news headlines, with one academic medical center citing a 60% decline in operating income in the nine months following a difficult conversion, and another 400-bed health system reporting a downgrade in its bond rating after sustained billing delays post-go-live led to a decline in revenue.
Despite the importance—and risk—of RCM system implementation, the focus is often overlooked or considered an afterthought. System conversions are commonly viewed as vehicles to meet regulatory requirements or meaningful use or as means to achieve an enterprise system’s clinical capabilities. The impact to revenue cycle, both in terms of potential functionality and efficiency gains and financial risk, may be underappreciated. Beyond the system conversion, revenue cycle implementations often involve operational changes to workflows or are planned to coincide with other organizational initiatives, necessitating even more careful planning and change management. Engaging key organizational stakeholders, driving efficiency and accountability through workflow redesign, and thorough testing and training enable organizations to realize the gains of a new RCM system while minimizing financial risk.
This article was originally published by Health Data Management August 3, 2018