While increasing revenue is a top goal for 2024, improving the patient experience is a close second — specially for large health systems: HFMA poll

A survey conducted by HFMA in collaboration with FinThrive found that larger healthcare organizations are expanding their strategic focus to include improving the patient experience, requiring significant investment in patient-facing technology to enable frictionless access and billing. This marks a shift from the previous year when the focus was primarily on revenue generation and cost reduction. Healthcare organizations of all sizes will continue to focus on increasing revenue by improving the prior authorization process and leveraging clinical documentation improvement initiatives more strategically, per the survey.

While all healthcare organizations say increasing revenue is the number one priority in 2024, improving the patient experience is also critically important, according to new research conducted by HFMA and FinThrive. The survey conducted between November and December 2023 includes responses from 92 healthcare finance, accounting and revenue cycle executives. Here are a few specific findings:

• Seventy percent of respondents say increasing revenue is a top priority in 2024 followed by improving the patient experience (60%) and reducing costs (55%).
• Respondents in organizations with an NPR of at least $1.1 billion say improving the patient experience is more important than reducing costs. This is particularly true for respondents in organizations with an NPR of more than $5 billion.
• Seventy-five percent of respondents say reducing denials is the top initiative to increase revenue. 
• Seventy percent of respondents say improving the prior authorization process is a key initiative in 2024, and 41% plan to invest in an electronic prior authorization solution.
• Eighty-two percent say improving the prior authorization process is a top strategy to improve payer-provider collaboration.
• To improve the patient experience, 60% of respondents will focus on patient scheduling. About 55% will improve the patient payment experience while 49% will improve patient payment estimation accuracy.
• More than one-quarter of respondents (27%) plan to increase the impact of clinical documentation improvement (CDI) as part of their strategy to increase overall revenue, making it more important than renegotiating payer contracts (20%), improving charge capture rates (16%) and introducing or expanding service line offerings (16%).

“Overall, these results reiterate that cash is always king,” said Jonathan Wiik, FHFMA, MHA, MBA, vice president of health insights at FinThrive. “And although cost reduction is still important, I’ve heard from several executives who say you can’t cut your way out of this crisis. You can only cut costs — particularly labor costs — so much before you start to impact operations. I think we’ve hit that point. This is part of the reason why patient experience has become more important than ever before. Organizations need to retain patients to insulate their top line revenue.”

The good news is that staffing levels have stabilized, enabling many organizations to cap their rates for clinical labor, he added.

Improving the patient experience

As healthcare organizations look beyond cost reduction measures, fostering patient loyalty is critical. 

“Hospitals are starting to measure the lifetime value of a patient just like Amazon, Target or Kroger do,” said Wiik. “In healthcare, that value is around
$1 million. For a hospital with half a billion patients per year, you’re talking about millions of dollars in lost revenue over time even if you only lose one tenth of a percent of those in your community to your competitor. Healthcare consumers will select facilities that offer frictionless access and payment options over those that do not. Successful organizations will have advanced technology and analytics in place to retain and delight patients.” 

 In 2024 and beyond, Wiik suspects organizations will monitor referrals and setting-specific patient volumes more closely to identify and immediately address any aberrant patterns that could suggest patient leakage. 

One of the most common reasons why patients choose one health system over another is the digital front door experience (or lack thereof), says Wiik. 

“Patients want to be in the driver’s seat,” he said. “They want to schedule their own appointments, look at their own test results and figure out their payment and funding mechanisms in advance of care. They do not want to wait in line or on hold. This is what I call ‘frictionless access’ and ‘frictionless billing,’” he added.

While many electronic health records (EHR) provide functionality to improve the patient experience, forward-thinking organizations are taking it one step further and investing in best-of-breed solutions that allow them to differentiate themselves from competitors, he said. This includes third-party solutions for patient self-scheduling and appointment reminders, virtual intakes and check-ins, patient messaging, good faith estimates and more.

“Organizations want to leverage their EHR as much as possible, and that makes sense,” said Wiik. “However, there may be opportunities to improve operational efficiency, increase patient volume and retention, or boost revenue simply by partnering with a third party that offers a comprehensive platform. There are often valid reasons to do this. It becomes a business issue. Even hospitals using large reputable EHRs find opportunities to improve performance with third-party vendors that complement the technology.”

For example, if a hospital is losing 20% of its patients because people don’t want to wait on hold to schedule an appointment, it becomes obvious that current technology isn’t enough and that an investment in a scheduling solution is an investment in the financial future of the organization, he added.

How can organizations know definitively whether their EHR provides sufficient functionality? Ask patients directly, said Wiik. 

“Get feedback through ongoing focus groups and your patient family advisory council,” he said. “Does your EHR afford a digital front door experience? Can it allow information to flow autonomously from the consumer side?” Key performance indicators like no-show rates, point-of-service collections, portal use and others can also provide insight into levels of engagement, he added.

Reducing denials, improving prior authorizations

Reducing denials also continues to represent a top a priority for all organizations, and one way to do that is by focusing on the thorny problem of prior authorizations, said Wiik. 

“Technological solutions must provide transparency and collaboration between payers and providers,” he added. “This includes a payer-provider data sharing platform with eligibility responses, contractual management provisions, charge description master data and claims information all in one place.” Denials come in many forms from downgrades, medical necessity determinations and everyone’s favorite: eligibility.

 Innovation will be key. 

 “To date, nobody in the market has completely solved the problem of prior authorizations,” said Wiik. “Hospitals are using solutions that impact a carved-out section of their workflow such as inpatient admission notifications, surgical authorizations or diagnostic testing, but these solutions don’t holistically protect revenue.”

As healthcare organizations evaluate new and emerging prior authorization solutions, Wiik suggests to consider the following:

• Does the solution improve clinical and encounter data sharing? If so, how?
• Does the solution update with payer rules frequently?
• Does the solution have a rules engine that reflects the majority of the payers?
• Is there substantiation embedded to defend the determinations from payers at a later date?
• Does the solution manage the status of the authorization (in terms of received, pended, denied)?
• Does the solution look at the full breadth of services provided by the organization?

The good news is that CMS’s recent Interoperability and Prior Authorization final rule released Jan. 17, 2024, imposes various requirements to standardize and streamline the prior authorization process, the majority of which take effect Jan. 1, 2026, said Wiik. More specifically, impacted payers must:

• Implement certain Health Level 7 Fast Healthcare Interoperability Resources application programming interfaces to improve the electronic exchange of healthcare data.
• Send prior authorization decisions within 72 hours for expedited (i.e., urgent) requests and seven calendar days for standard (i.e., non-urgent) requests. 
• Provide a specific reason for denied prior authorization decisions. 
• Publicly report certain prior authorization metrics annually by posting them on their website. 

“The rule is a step in the right direction, but one downside is that it only applies to certain types of payers,” said Wiik. For example, almost half of all payers in our country are self-funded employers and thus fall outside the rule. However, over time, I think we’ll see more payers jump on board because the market demands standardization.”

As organizations focus on denials, they’ll need to look beyond prior authorizations to include denials due to downgrades, medical necessity determinations and other reasons, said Wiik. This requires root cause analysis and specific strategies, he added. 

Increasing CDI impact

As part of their strategy to increase revenue, healthcare organizations are increasingly relying on CDI to accomplish this goal. Wiik says it’s largely due to workforce challenges that have become amplified among coders, nurses and physicians — all of whom are pivotal to documentation.

“It’s about getting credit for the care that’s delivered and increasing yield from payers,” said Wiik. “Investing in CDI is mission critical. It’s an investment in highly skilled clinical labor as well as an investment in technology to identify documentation gaps and prioritize cases.

“A holistic approach is necessary to insulate providers from uncertainties that lie ahead.”

Conclusion

As healthcare organizations navigate the remainder of 2024, one takeaway remains clear: Financial leaders must leverage top talent, technology and their pool of patients to promote financial sustainability.  

About FinThrive

FinThrive is advancing the healthcare economy. Our  1,600-plus colleagues rethink revenue management to pave the way for a healthcare system that ensures every transaction and patient experience is addressed holistically. We’re making breakthroughs in technology—developing award-winning revenue management solutions that adapt with healthcare professionals, freeing providers and payers from complexity and inefficiency, so they can focus on doing their best work. Our end-to-end revenue management platform delivers a smarter, smoother revenue experience that increases revenue, reduces costs, expands cash collections, and ensures regulatory compliance. We’ve delivered over $10 billion in net revenue and cash to more than 3,245 customers worldwide. When healthcare finance becomes effortless, the boundaries of what’s possible in healthcare expand. For more information on our new vision for healthcare revenue management, visit finthrive.com.

_{This published piece is provided solely for informational purposes. HFMA does not endorse the published material or warrant or guarantee its accuracy. The statements and opinions by participants are those of the participants and not those of HFMA. References to commercial manufacturers, vendors, products, or services that may appear do not constitute endorsements by HFMA.}