How to Strengthen Your Hospital’s Financial Health
Hospitals are naturally focused on the health of their patients, while often giving much less thought to their own financial health as an organization.
But with declining reimbursements, increasing medical debt and growing pressure to deliver higher quality care at a lower cost, hospitals can no longer afford to be shortsighted when it comes to their finances. In observance of the encroaching of April’s Financial Literacy Month, now is a great time to take a closer look at your financial habits as a hospital and consider adopting healthier practices.
Financial challenges topped the list of concerns for hospital CEOs in 2018, according to the American College of Healthcare Executives’ annual survey of issues facing hospitals. Nearly 70 percent of respondents cited increasing costs for staff and supplies as their biggest financial obstacle, followed by dwindling Medicaid and Medicare reimbursements, bad debts, and hurdles with managed care and commercial insurance payments.
Maintaining a steady stream of revenue is crucial to balance the influx of patients coming through your doors with the payment complexities of a consumer-centric healthcare market. Ultimately, patients are the ones who suffer when your facility lacks the funds to fill personnel shortages, invest in new technologies and equipment, or attract and retain the clinicians needed to deliver the best care. Improve the financial prognosis of your hospital by making sure your facility is capturing every dollar of patient revenue. Use these strategies to bolster your revenue cycle:
- Coordinate business office operations. In many hospitals, there is a disconnect between front-end staff who register patients and confirm their insurance coverage and eligibility, and back-end staff who manage claims, denials, medical billing and collections. Encourage collaboration by educating everyone in the revenue cycle on what’s needed to process a claim and how to calculate patient financial responsibility. Taking more time on the front end to track down the right documentation and discuss potential payment issues with patients can save time and money on preventable denials and claim resubmissions on the back end.
- Keep tabs on payer contracts. The growth of managed care and high-deductible insurance plans has made navigating the maze of payer rules for claims reimbursement more complicated than ever. Communicate clearly and frequently with payers to make sure they are reimbursing you properly and not denying too many claims or putting unreasonable demands on your accounting office. Use an automated system to compare costly procedures to reimbursements from top payers and negotiate more reasonable rates when necessary.
- Track performance with analytics. Use financial data and reporting tools like dashboards, charts and graphs to identify bottlenecks in your revenue cycle and opportunities for improvement. Remember you can’t manage what you don’t measure! Develop key performance indicators (KPIs), like net days in accounts receivable, claim denial rates and cost to collect, to monitor how transactions are trending and to create benchmarks for improved efficiency and spending.
MEDHOST’s Business Office Services give hospitals the tools they need to not only gain more visibility into their own payment process, but also to obtain faster, more accurate reimbursement from health plans. Our billing software is designed to help decrease accounts receivable delays by accelerating bill generation and improving claim acceptance. Our contract management solution helps hospitals tackle underpayments from insurance companies and interfaces with a digital charge estimator that staff can use to calculate payment responsibility for patients before they receive a service. We also provide dashboard reporting tools that give hospitals a granular look at their clinical, financial and revenue cycle performance and help them to create KPIs to boost productivity, cash flow and financial health.
Ready to strengthen the financial health of your hospital? Email us at firstname.lastname@example.org or call 1.800.383.6278 to speak with one of our specialists to learn how MEDHOST can implement technology-driven solutions that can prioritize your revenue cycle services.