To Outsource or Not to Outsource?
Historically, the healthcare industry has been a bit more hesitant to follow the pace set by other industries in its attempt at process outsourcing. There are many reasons for this:
1. Physician’s fear for loss of control
2. Lack of understanding of that particular group’s specialty or system
4. Fear of impact on internal staff
5. General Efficacy
6. Disruption and a decline in performance
For years, many industries such as banking, technology, utilities, and others have been successfully outsourcing. Healthcare companies have significantly changed their perception and have begun to follow suit and embrace the concept.
If you can answer the following questions with a “yes”, it may be time to explore the Outsourcing:
1. Has our practice had chronic issues regarding the management of our revenue cycle or have we just never been able to get our arms around it?
2. Is it conceivable that a reputed outsource company will truly understand our business; including our technology?
3. Have turnover or labor costs had a significant impact on the efficacy of my Revenue Cycle (billing and A/R) outcomes?
4. Do we have trouble consistently measuring our financial outcomes?
5. Is outsourcing cost prohibitive?
6. Have we seen a negative trend in our cash flow, aging, and collection ratios?
7. Do we have fears of losing control?
These are all very valid concerns, but consider this:
1. Many, not all, practices do not have ongoing tools to measure Key Performance Indicators (KPI’s) and how they meet “Best Practice” benchmarks. Again, ‘experts’ can help greatly in this area.
2. Most practices do not have a great feel as to what resources it really takes to effectively manage their revenue cycle.
3. Staffing matters can and usually do lead to many of these problems.
4. An outside, well regarded firm, can actually eliminate the turnover and understand your business.
5. The cost of NOT collecting accounts receivable timely has startling negative implications. An account loses almost its entire collection viability at 120 days.
6. Intake problems and ineffective follow-up is a key driver to this problem. Accounts MUST be worked EVERY MONTH.
7. Cost of uncollected accounts are rarely factored into the ‘cost of doing business’ (what we call “Opportunity Costs”).
8. Many practices do not know, despite instincts, the depth of their revenue cycle problems due to lack of objective measurement. An outsource company like VRS can assist in bringing clarity.
9. The day-to-day ‘hustle and bustle’ of running your practice can be instrumental in actually losing control by de-prioritizing many of the RCM downstream functions.
Please feel free to reach out to VRS and we are delighted to offer complimentary assistance to bring some clarity to your accounts receivable function.