"A key avenue for creating customer loyalty, and gaining an edge in an increasingly competitive marketplace, is found in the revenue cycle. ... As a result, the revenue cycle can be pivotal in establishing each patient's overall experience of the provider's performance, opinion of the brand and likelihood of becoming a repeat customer."
— Becker's Hospital Review
As we've already discussed, there are big changes happening in healthcare revenue cycle management (RCM). Hospitals and other health providers need to get their RCM under control to avoid cost leakage, create better experiences for patients, and reduce the debt they need to absorb.
There are several good ways to optimize how RCM works, both within the process itself (RCM outsourcing, smart analytics) and in how an RCM works with patients. It's the second, patient-focused area we'll dive into here.
Providers Will Need to Embrace Transparent Pricing
It's not easy for patients to understand the true cost of their healthcare. This is doubly true if that care is urgent or the patient has few options for getting the care they need. This issue of confusing pricing is one of the most important areas providers need to tackle.
RevCycle Intelligence has it right when it says: "When it comes to transparency ... healthcare consumers are actively trying to figure out how much their care delivery costs and make informed, educated choices." But when consumers attempt to gather pricing data, it is mostly "impracticable to obtain."
Hospitals and healthcare providers typically only receive about a third of the costs billed directly to patients, and much of this is due to the unexpectedly high costs of healthcare.
Insurance industry veteran W.E. Heasley explains that this lack of transparency is causing a big problem. In normal consumer markets, prices allow consumers to make value-based purchase decisions. In healthcare, without transparent pricing, consumers aren't able to make decisions those value-based decisions. "Had price been a signal, many exchanges [services rendered] would have never occurred, as the patient would have been unwilling to pay such price at the point of exchange," Heasley writes.
David Josephs, SVP at First Data Corporation, suggests there is room for innovation within transparent pricing, as well. "It's possible that high deductibles and increased patient responsibility may create opportunities for spot pricing in the provider market," he tells Rev Cycle Intelligence.
Providers Will Need to Create Better Customer Experiences
A patient's positive experience with RCM starts with understanding pricing. "If hospitals and healthcare systems can accurately and confidently tell patients what they'll owe, patients generally see it as a positive interaction," says Heathcare Finance News. "They start to view it like any other [buying] experience, whether it's going to the auto mechanic or the coffee shop."
A patient's RCM experience isn't just linked to price — every part of their experience must be considered and improved. The Revenue Cycle Improvement Task Force explains why providers need to put the patient front and center: Patients should be able to understand their plan benefits, research in-network providers, clearly understand what it's going to cost them, and understand the quality healthcare providers give.
Consumer-side demand already exists for this kind of experience optimization, Perficient's Chris Donahue says. "The rise of consumerism and the digital patient have created an environment where patients expect to be involved in their treatment and treatment options with their care team in a digital manner."
An EY white paper expands on Donahue's point and offers four necessary elements in this kind of digital consumer experience:
- Access needs to be seamless.
- Patients need to be able to get clear estimates and do price comparisons.
- Patients need access to counseling services that will help them navigate plans, benefits, and their personal financial responsibilities.
- Patients need access to a financing program.
The next generation of healthcare professionals is being educated and prepared for the realities of consumer healthcare. "Medical schools are now teaching students to incorporate financial counseling and awareness into their everyday practice," Revenue 360 writes. "Suggested actions include talking with patients about the costs associated with tests and procedures and offering advice when appropriate, and also carefully evaluating medical necessity before ordering certain tests and medications with high price tags."
The benefits of such consumer empowerment would be huge. If patients are able to make smarter decisions for their own care, then providers have to worry far less about whether they're going to get paid. Then, providers will be able to focus on what they do best: Treating conditions and saving lives.