News Column

Revenue Cycle Technology: Key Factors for Choosing a Solution

August 1, 2014


As hospitals and health systems strive to optimize their revenue cycle, they are turning to technology to streamline processes, improve accuracy, and speed cash flow. Depending on the organization, this may involve implementing a best-of-suite revenue cycle solution or extending the clinical IT health information system (HIS) solution to the financial operations.

There are many pros and cons to consider when evaluating whether to choose a single source for the entire HIS solution or a stand-alone revenue cycle solution. For instance, organizations may have to sacrifice optimal functionality in some area, such as contract management, eligibility, or scheduling, to have a single vendor to support the system.

Before committing to a specific technology strategy, organizations should explore options and trade-offs. "Taking time to objectively weigh the advantages and disadvantages of various strategies is a good idea," says Darrell Burke, PhD, associate professor in the Master of Science in Health Informatics Program at the University of Alabama at Birmingham (UAB). "Organizations should create a decision matrix, including key stakeholder input, that details hard and soft factors, such as costs, resource impact, integration capability, prior vendor responsiveness, and so forth. Once you have documented all the inputs and have added the relative weights for each factor, the decision matrix can point to an answer that makes the most sense for your organization."

The following actions also are important in the decision-making process.

Examine Current Processes First

To lay the groundwork, organizations should first gain an appreciation of the existing state. "It can be helpful to map your revenue cycle from beginning to end to understand current workflow, review what tools you already have, and determine what you need to adequately support the entire system," says Carolyn Williams, vice president of revenue cycle for Mather Hospital in Port Jefferson, New York. "If there are opportunities to integrate and minimize interfaces between solutions, then you may want to seize those opportunities. The more interfaces you have, the more you open yourself up to risk. Each interface must be managed to ensure data flows appropriately. A more seamless system does not require as much hand-holding and the chances of information falling through the cracks are reduced."

In addition, preserving data integrity in a system with multiple interfaces can be difficult as a change in one application may require a change in all. A minor tweak may become a major undertaking, and the opportunity for error goes up exponentially.1

"Our goal is to have one revenue cycle system that handles everything, but we are not quite there yet," Williams says. "In certain situations, we still use stand-alone solutions that deliver more robust functionality. Basically, we use a best-of-suite solution for most of our revenue cycle tasks and then supplement that system with bolt-ons when it makes sense."

When mapping current processes, look to revenue cycle staff as a critical information source since no one else knows the revenue cycle better or is as familiar with potential improvement opportunities. "In addition to gaining valuable information, tapping staff knowledge can also garner support for a new initiative," Williams says. "People don't like change, but if you seek staff feedback and make them a part of the technology build, then you can generate buy-in and get a better product outcome in the process."

Assess Long-Term Goals

Another factor to consider is where the organization hopes to be in five to 10 years. Is it growing? Is it planning to employ or partner with more physicians? Is it likely to see new payment models? Will it participate in risk-sharing agreements involving other care settings? To remain nimble, organizations should select technology that is flexible enough to facilitate long-term goals, but detailed enough to support current needs.

"The world of health care is changing, and you have to choose a solution that will change along with it," Williams says. "Revenue cycle IT needs to enable strategic objectives. On a more practical level, you want technology that will evolve; this is a huge investment, and it cannot be obsolete in five years."

Examining the underlying architecture of a revenue cycle system can determine if the tool is designed to be agile and adaptable, which allows faster response to changing regulatory and other market pressures. According to a report by Gartner that offers guidelines for healthcare technology vendor selection, "How a vendor thinks about system architecture, the management of application development, and the maturing of implementation methods are three of the most revealing core competencies to assess."2 The report further states that a mature revenue cycle technology solution is rich in features and functions, meets the needs of a variety of healthcare settings, and supports decision making at all levels of the healthcare organization.

Gauge Integration Potential

As the financial and clinical sides of health care become more intertwined, it is essential that any revenue cycle solution be able to communicate with clinical tools. Organizations should look for systems that cultivate the financial-clinical partnership, allowing for easy exchange of information. In some instances, this pursuit may mean fostering smooth connectivity with a disparate clinical EHR. A revenue cycle system that can seamlessly interface with and ultimately integrate with multiple technologies will be well-positioned to share information in a prompt, secure, and accurate fashion, facilitating a more collaborative approach to patient care. The need for such connectivity increases dramatically when an organization wants to share information outside the hospital, as a solution may have to communicate with multiple diverse and divergent systems.

Respect All Stakeholder Input

Which technology strategy an organization chooses will depend on who drives the decision. If IT is leading the charge, then an organization may opt for an integrated system that has fewer interfaces and supports more streamlined workflows. However, this technology may not fully satisfy revenue cycle and clinical needs. Similarly, if physicians are driving the choice, they may opt for solutions that support clinical operations but are less effective at meeting revenue cycle goals. "To make the best decision for your organization, you have to bring financial, clinical, IT, and administrative leadership to the table," says Mather's Williams. "All of those perspectives are valid and valuable, and it is important to gather input from each source before moving forward. Otherwise, you may end up with a system that pleases one group but is cumbersome for another."

Multi-stakeholder input is especially important when an organization selects technology that integrates clinical and financial processes. "Financial and clinical leaders must come together and understand how their different workflows impact each other," says Melissa Greer, vice president of revenue cycle operations at University of Colorado Health (UCH) in Denver. "If you try to implement technology without keeping all perspectives in mind, then you can skew things to one side. For example, there are a multitude of decisions that need to happen when building an integrated system. If IT and clinical leadership are making the decisions without revenue cycle, then by the time the system is built, there may be clumsy financial workflows or awkward revenue cycle processes that are difficult if not impossible to change. To avoid this, revenue cycle leaders should jump in from the beginning and create a partnership so the organization can design a system that works well for everyone."

Consider Total Cost of Ownership

When figuring cost, organizations need to look beyond the sticker price for a solution or series of solutions and also think through the cost to use and maintain the technology. Questions to ask include:

* What are the one-time costs?

* Are there recurring fees?

* What are the resource impacts?

* What are the training and education costs?

* Are there opportunity costs involved with staying with the current strategy? Switching strategies?

* If an organization employs a series of bolt-on products, does the staff use manual workarounds to use these tools? Do such efforts create too much time burden or error opportunity?

"A number of stand-alone solutions deliver optimal information but they are not user-friendly or interwoven into the larger, integrated system, so they can be harder for staff to use," says Mather's Williams. "This is a cost we look at closely. We weigh which product delivers the best value, taking into account the functionality versus the resource and monetary impacts."

Seek Outside Opinions

Organizations onboarding revenue cycle technology are not alone, as many progressive hospitals and health systems are actively engaged in similar initiatives. "Networking with other providers who have made the transition is helpful, as you can gain knowledge and perspective from their lessons learned," says UAB's Burke. "Going on site and seeing a system in action can be particularly beneficial."

Others agree. "A site visit was critical for us," says UCH's Greer. "We had a high-performing revenue cycle before making the transition to an integrated system, and we wanted to make sure that the new technology would support us to at least the current level. Actually being able to see the technology 'in use' helped us get a better appreciation of its capabilities as well as the potential risks. During our site visit, if we had discovered any gaps or risks that appeared insurmountable, we would have gone in a different direction."

Look for a Partner, Not Just a Vendor

Revenue cycle technology is constantly advancing, so selecting a vendor that is committed to revisiting, updating, and upgrading its product is key. "We think of our vendor as a partner-someone who respects our needs and is willing to address them, even if it requires out-of-the-box thinking," says Mather's Williams. "If we are aware of a stand-alone solution that performs better than our best-of-suite product in a certain area, we can discuss it with our vendor. Our vendor takes it seriously, working with us to get the functionality we need."

Service level is a key consideration. "You have to believe in whatever vendor you choose," says UCH's Greer. "You want to make sure the vendor has an ear to the ground on new trends and has a robust commitment to development. As healthcare reform takes hold and the fundamental way care is delivered and paid for changes, you need a system that enables your revenue cycle to keep up. Basically, you want a company that is always one step ahead, so you can navigate change successfully."

Have a Plan for Getting Started

Once an organization selects a system, it should set the stage for implementation. Onboarding new technology is not always easy; organizations should have a plan that balances the need for expediency with the need to be thorough. Following are a few suggestions on how to lay the groundwork for a smooth transition.

Allocate time. Getting a new system up and running is rarely quick or straightforward. As such, organizations must allow plenty of time. "The key word here is migration," says UAB's Burke. "Moving from a best-ofbreed to a single HIS approach can be done in stages to minimize disruption.\ Shifting from one of these strategies to a single vendor solution can be quite disruptive, so organizations should be prepared and set aside sufficient time for the process."

Resource up. "You may want to hire additional staff during implementation to help with the increased workload and mitigate potential productivity slowdowns," says Mather's Williams. "Most hospitals don't want to spend money for these resources, and that's where they go wrong. They try to make the shift using existing staff, and it can cause real cash flow problems short term."

Have a well-considered training plan. Having a multifaceted program that involves hands-on training is essential. The vendor should be a main source for education materials, but an organization should customize the effort to meet its unique needs and culture. For example, if an organization has both on-site and remote revenue cycle staff, then training should allow for multiple venues, including online and classroom locations. Staff should also be given time during the workday to complete training-the easier it is for staff to access and participate in training, the more likely they will be to make the effort to learn the new technology. "It shouldn't just be front line staff taking the training," comments UCH's Greer. "Department leadership should also be trained on the system so they can see firsthand where the potential stumbling blocks are. This is a huge transformation for your staff, and leaders can better communicate about the transition if they can empathize, having gone through the training themselves."

Track performance. Before starting implementation, define metrics that will demonstrate whether the new approach is yielding the anticipated benefits or if there are areas still requiring attention. Both financial and patient satisfaction metrics can be valuable. For instance, looking at days in A/R, denial rates, and clean claim rates can paint the financial picture, while areas such as scheduling delays, appointment wait times, and patient perceptions of efficiency and communication can point to patient satisfaction. Once an organization selects its metrics, it may want to create a balanced scorecard that shows all the outcomes in one spot. This "dashboard" allows leaders to identify issues promptly and respond quickly, making meaningful changes in a short period.

Solicit feedback. As implementation progresses, make sure to reach back out to all stakeholders to gauge if the system is working as expected and to identify any unintended consequences. Having a standing meeting of clinical, financial, and operational leadership to discuss successes and concerns can help an organization pinpoint problems early and address them before they cause clinical or financial headaches.

Now Is the Time

With all of the competing priorities healthcare organizations currently face, seeking new revenue cycle technology may not rise to the top of the list. However, there is value in embracing new technology and getting started on the path toward improvement.

"It can be easy to table this work because you are comfortable with your existing solutions, even if they are not ideal in supporting long-term goals," says UCH's Greer. "But there is an opportunity here that organizations should not ignore. Now is the time to think about how to fully prepare your revenue cycle to support the coming changes and keep the organization agile as health care continues to evolve."

Revenue Cycle Across the Continuum

Troy Phillips, MHA, CHFP, PMP, director of revenue cycle strategy for Siemens Healthcare, discusses the importance of an integrated revenue cycle across the healthcare enterprise's care continuum.

Is a single source vendor necessary to lower the cost of care?

Selecting a single vendor's HIS solution does not necessarily guarantee lower cost of care. The integration of a single revenue cycle solution across the healthcare enterprise can provide many benefits while helping to lower the cost of care. Patients' benefits include the ability to register once anywhere within the continuum of care and facilitation of consolidated, easy-to-read statements. Benefits to the healthcare organization include the ability to expand through consolidation, a streamlined business office, improved insurance follow-up systems, and standardized data for decision making and business intelligence.

What role does horizontal integration of the revenue cycle play in mitigating risk?

When it comes to ACOs and taking on contracted risk, healthcare organizations need to understand their real costs and reimbursement at a service level. Understanding the precise costs for every encounter, procedure, or episode of care is an essential part of managing risk across the contracted continuum of care. Such precision allows for accurately assessing profitability of individual service lines, provider relationships, and clinical management of the selected population. With disparate systems come disparate master files and the inherent expense and risk of mapping data from multiple sources.

With a robust rules engine supporting integrated technology, policy and procedure can be established across the continuum to ensure consistency of data and improve the ability to intelligently manage the financial health of the organization.

Source: Siemens.


Siemens Healthcare is one of the world's largest suppliers to the healthcare industry and a trendsetter in medical imaging, laboratory diagnostics, medical information technology, and hearing aids. Siemens offers its customers products and solutions for the entire range of patient care.

For more than 40 years, Siemens Healthcare has helped healthcare organizations improve efficiency, increase quality, and decrease cost with innovative IT solutions that help to streamline and coordinate patient care activities across the enterprise. Siemens has the products, people, and knowledge to bring it all together to help healthcare enterprises function as a cohesive unit instead of a multitude of departments.

Siemens healthcare information technology solutions aid in delivering crucial information when and where it is needed most. These solutions help transform data collected from across the healthcare enterprise into actionable steps for healthcare professionals to make more informed decisions.


1 10 Key Revenue Cycle Technology Considerations for the Future, Healthcare Financial Management Association, 2013.

2 Handler, T., et al., "CIOs Should Use These Guidelines to Ensure Healthcare IT Megasuite Vendors Don't Handcuff Their Futures," Gartner, Dec. 14, 2010.

For more stories covering the world of technology, please see HispanicBusiness' Tech Channel

Source: Healthcare Financial Management

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