The impact of the coronavirus (COVID-19) outbreak is far-reaching and is a significant disruption to healthcare institutions. While the most urgent priorities are in provision of care, providers also need to maintain well-functioning revenue cycle management (RCM) and financial systems to support clinical operations. This is where banks and financial firms can play a bigger role, assisting providers in ensuring workflows and processes are adaptable to an extremely fluid situation. It is a significant shift in the traditional relationship between providers and banks, but COVID-19 is changing expectations. Banks are taking on more responsibility, collaborating with providers to offer valuable solutions and insights to the industry’s biggest payment and financial challenges.
Respecting that hospital and health system executives are intensely focused on crisis management, CommerceHealthcare® offers this brief article containing four actionable considerations to help bolster finance and revenue cycle operations during this challenging time.
1. Leveraging Automation for Business Continuity
The persistence of manual financial processes creates inefficiencies in normal times. Current stresses are likely to cause even greater challenges. Employees are working remotely, and virus-related illnesses may trigger short-staffing situations. Automation can be part of the solution to avoid interruptions and strengthen business continuity. For example, internet-based payment processing systems enable finance and revenue cycle staff to work remotely, keeping key financial operations moving forward.
Similarly, automation can alleviate disruptions in reimbursement management. With new billing codes established for coronavirus-related services and a significant ramp-up of telehealth usage, conventional remittance processing flows, already complex, may be slowed or altered. Additionally, healthcare providers will likely see a surge in receivables processing once restrictions on non-COVID-19 related clinical care are lifted. Automation of the posting and reconciliation process for insurance and patient receivables can help maintain necessary efficiency and accuracy, while optimizing staff productivity and improving cash flow. Healthcare organizations should assess their internal processes for immediate opportunities to streamline and automate where possible.
2. Expand Patient Financing Options
Much industry attention has been devoted to growing patient financial responsibility for high deductibles and other factors. Necessary coronavirus treatments threaten to exacerbate difficulties many are having affording medical bills. As one article highlights, “reports have surfaced of patients being left with thousands of dollars in medical bills after seeking care for potential coronavirus symptoms.”1
Medicare and private payers are moving to cover COVID-19 testing and procedures, but the situation remains in flux and patient stress is high. Many hospitals and systems offer payment plans that are frequently limited in scope and duration.
Providers are also utilizing this period to enhance communications with patients regarding payment and financing options, positively impacting patient satisfaction. For example, some providers are extending collection deadlines for patients on current financing programs. Many providers are also offering long-term financing programs with no- or low-interest lines of credit.
3. Accelerate Cash Flow and Create Liquidity
The coronavirus pandemic is straining cash flow from several directions. Both the American College of Surgeons and the Surgeon General have recommended deferring elective surgeries, and most health systems are heeding the call. The revenue impact is clearly substantial. In addition, supply chains for drug and therapy inventories have been interrupted, and critical shortages have emerged. Large cash outlays will be needed to make short-term purchases of supplies intended to fight the virus.
Access to capital to support cash flow needs is vital. Upfront payments from a well-capitalized patient financing program can serve as an immediate source of cash flow.
4. Protect Long-Term Strategies
Healthcare has been working hard in recent years to make progress on critical objectives related to value-based care, generating new growth, responding to retail competition, and embedding agility throughout financial processes. Many of these initiatives are in early stages. As a Gartner analyst described it, “We’ve been doing healthcare the same way for decades now, and we’re on the precipice of a new way of delivering care. We’re not in the new era, we’re just kind of walking through the doorway.”2
Momentum can be stalled or endangered by the current crisis, as organizations in some cases necessarily revert to traditional ways of doing business. To the extent possible, leaders must reserve some focus on minimizing this reversion and keeping vital strategies on track.
Conclusion
While the coronavirus pandemic is putting extensive pressure on the industry, healthcare providers and banks across the country are rising to the challenge. This article highlights four approaches financial leaders can take to position their organizations to not only navigate the current challenges, but also better position their organizations going forward. Banks have the resources and experience to help integrate these strategies and tools, while providers focus on delivering critical care during the pandemic.
CFOs and their financial staffs throughout the country deserve great credit for their resilience and leadership during this difficult time. It is also important to remember that you are not alone. CommerceHealthcare® is here to help. Our team of experienced healthcare executives and financial professionals is ready to discuss your specific challenges and offer strategies and tools that can provide immediate impact to your organization.
Resources
- J. LaPointe, “How COVID-19 is Impacting the Healthcare Revenue Cycle,” RevCycle Intelligence, March 10, 2020.
- L. Wilson, “Top Five Healthcare Technologies,” Managed Healthcare Executive, February 2020.
