Can modern revenue cycle management tech eliminate an age-old healthcare business problem?

An unprecedented wave of retirees is creating a generational skills gap that’s threatening to overwhelm healthcare. Over 2 million workers will depart the industry by 2029, more than any other sector. As they leave, so will their formidable skills, hands-on knowledge, and experience, and finding the talent to fully replace them will be unlikely, if not impossible.

Insurance claims follow-up, a critical function that financially supports and stabilizes provider entities, will be especially hard hit. A 2024 report by Premier, based on a survey of more than 500 acute care hospitals, revealed about $10.6 billion was wasted debating claims that should have been paid upon submission. Veterans who know how to negotiate this complex realm are invaluable, especially for health systems in small and mid-tier markets.

The exodus of retirees continues and the skills gap is growing wider. Combined with healthcare systems’ already limited resources, lack of specialized revenue cycle management (RCM) talent, and skyrocketing costs that are causing many hospitals to close, entire communities are left vulnerable.

Problems in the claim process

Healthcare has long been caught in a repeating, unhealthy insurance claim cycle that slows and stops reimbursements from payers (insurers). For example, a provider will submit a claim but the insurer only covers some of it, while denying other parts. The provider then has to rework and file the claim, all by a date the insurer sets, and funds may never be recovered if that deadline isn’t met.

Insurance obstacles can create frustration and loss of revenue for providers. Claims denials mean payers hold on to money, and in many instances, that’s where the funds remain. Premier’s survey found 15% of claims submitted to insurers weren’t covered despite being pre-approved. And even if claims are eventually paid out, it’s still costly: More than half of claims denied by private payers were overturned, but the appeals process cost providers about $20 billion annually.

Some insurers say they’ve invested in new technology to speed reviews and drive accuracy, including machine learning (ML) and natural language processing (NLP). Unfortunately, provider staff have yet to see the benefit and still must remain two steps ahead of insurers when it comes to claims, adding to already daunting workloads.

Bills and skills

This cycle needs to end and there’s emerging technology on the provider side that’s offering hope. RCM technology can greatly reduce the collection time and effort, especially for what is often too few dollars, while bridging talent gaps.

For instance, if you’re a 140-bed hospital – and your 25-person revenue cycle team will see a dozen retire in the next three years – it will be nearly impossible to find equal replacements. But with RCM tools, you can streamline workflows and collections, while focusing on claims that have the most value. The technology can also raise data accuracy, operational efficiency, cash flow and facilitate compliance.

This all combines to increase revenue collected, which can then be used to improve patient care and bring greater support to healthcare pros and hospital initiatives. This is what boosts a health system’s financial standing and resilience.

RCM in action

It doesn’t take long for RCM platforms to have an impact. In fact, Hancock Health, a full-service, independent healthcare network in Indiana, enlisted Revology’s SaaS platform and saw results in just 90 days. The technology identified opportunities to better manage workflows, resulting in newfound transparency and productivity. From August 2023 to August 2024, A/R decreased by 16 percent, and A/R over 90 decreased by 40 percent. All total, there was a 5.5% year-over-year increase in cash collections.

This led Hancock Health to expand the partnership to multiple years, including the software and RCM management services. Insurance follow-up now harnesses advanced analytics to refresh claims every day, ensuring focus is always on those with the highest value. It consolidates health records and payer information into one intuitive and gamified workspace, provides views into team and individual performance, and allows leadership to quickly adapt to changing insurer scenarios.

Tools you can use

The RCM market is projected to exceed $238 billion by 2030 and there are many great options out there. However, expect the volume of solutions to climb rapidly as new vendors capitalize on the market. Remember that you’re attempting to change a claims process that’s embedded across the industry. So choose wisely: You’ll need experienced people to provide ongoing strategy and best practices.

Finally, keep in mind that providers are constantly hit with new regulations, data responsibilities, and community healthcare issues. Be sure any RCM tools you consider are user-friendly and help employees do their job. This is vital not only for bridging skill gaps but spurring adoption. And with record numbers retiring, and healthcare providers facing ever greater stress, empowering your people to do more with less staff is what’s needed for survival and success.