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80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
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7/31/2019 80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
Source: Thinkstock
May 14, 2018 - Approximately 80 percent of hospitals leaders in a new Black Book survey
(https://www.prnewswire.com/news-releases/by-2022-average-hospital-costs-
must-be-reduced-by-24-to-breakeven-and-outsourcing-may-be-the-solution-
says-black-book-300643743.html) said they were vetting or considering outsourcing
full revenue cycle management by 2019.
The demand for revenue cycle management outsourcing is also significantly up, revealed the
survey of 709 C-suite executives, board members, and senior managers at hospitals and
other inpatient organizations.
But many more hospitals and inpatient organizations may partner with a third-party vendor
to perform full revenue cycle management functions by 2019. Demand for full revenue cycle
management outsourcing increased 86 percent between 2015 and 2019.
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7/31/2019 80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
added. Ninety-four percent of hospital leaders are vetting or considering ERP outsourcing in
2019, accounting for an 85 percent boost in demand since 2015.
READ MORE: Top Revenue Cycle Management Vendors and How to Select One
(https://revcycleintelligence.com/features/top-revenue-cycle-management-vendors-and-how-to-select-
one)
The top vendor for outsourcing full revenue cycle management was Optum360, Black Book
reported using data from the third quarter of 2017.
Conifer, Parallon RCM Point, and Relay Health also earned top spots according to large
hospital chains and health systems, while small hospitals with fewer than 100 beds preferred
Xtend Navient, TruBridge, and MediRevv.
Optum360 also nabbed a high-ranking spot for end-to-end revenue cycle management
outsourcing among physician practices and groups, taking its place behind R1 Accretive and
Cerner RevWorks, which took the top spot.
While more hospitals are seeking to outsource full revenue cycle management, the Black
Book survey also showed that hospitals and inpatient organizations are looking to outsource
key clinical functions to reduce costs and focus on value-based care
(https://revcycleintelligence.com/features/what-is-value-based-care-what-it-
means-for-providers) initiatives.
The survey showed that the organizations are seeking to outsource a lot more in the near
future to realize cost efficiencies. The average hospital costs must fall by 24 percent by 2022
for organizations to breakeven, the report stated. Nine out of ten hospitals are also
considering partnering with a third-party vendor to allow hospital leaders and providers to
prioritize value-based care implementation.
“[N]ow, hospitals have a cost structure that is not sustainable, and some hospitals are
making the decision to actually enhance clinical product lines by outsourcing to power up
volumes and improve health consumer satisfaction," said Doug Brown, President of Black
Book Research LLC.
“Value-based care reforms have put pressure on hospitals to decrease inpatient volumes,
achieve outcomes goals and provide cost-effective care. Clinical services outsourcing is the
rage because it offers struggling hospitals with immediate alternatives,” he added.
Healthcare outsourcing has primarily been isolated to anesthesia and emergency medicine,
the report noted. But hospitals and other inpatient organizations are now seeking to hire
third-party vendors to manage their diagnostic imaging service lines, the survey showed.
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7/31/2019 80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
The change in demand for teleradiology outsourcing grew 97 percent between 2015 and
2019, representing the most sought-after area for outsourcing. Diagnostic imaging
equipment for cardiology and radiology was a close second, with the demand increasing 91
percent between 2015 and 2019.
Researchers posited that outsourcing for diagnostic imaging service lines is at an all-time
high because hospitals do not have the capital to invest in replacement technologies and
imaging centers.
READ MORE: 85% of Orgs Looking to Replace Revenue Cycle Management Systems
(https://revcycleintelligence.com/news/85-of-orgs-looking-to-replace-revenue-cycle-management-
systems)
Service levels exceeded expectations in over 81 percent of hospitals that outsourced key
clinical a and non-clinical functions in 2017, the survey found.
“Outsourcing in the healthcare industry doesn’t get the same bad rap other sectors
experience such as banking, insurance, tech and call centers where negative stereotypes
associated with offshoring and/or full function outsourcing were largely misinformed,” said
Brown. “In hospitals, there is a developed understanding of the broad spectrum of
outsourcing options and how to manage vendors.”
“For hospitals in financial danger with margin pressures placing the entire hospital
workforce at risk, attacking margin by outsourcing one or more areas can actually save jobs
in other core departments,” countered Brown.
Hospitals and inpatient organizations can also create outsourcing agreements that do not
impact staffing or stipulate the retention of existing staff, he added. Organizations can also
improve their performance through outsourcing by partnering with the right vendor, the
survey continued.
A related survey of almost 4,600 client users of hospital outsourcing products identified the
following top vendors by service line based on customer satisfaction and experience:
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7/31/2019 80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
"As hospitals look for ways to reduce costs, outsourcing is a valid strategy to achieve a
financially healthier organization. Caution should be given with the common pitfalls in
healthcare when vetting or considering outsourcing," said Brown.
“It is a matter of finding the right company to partner with. Through research and
background checks on the firms being considered including the vendor’s history of
partnerships with other hospitals.”
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7/31/2019 80% of Hospitals Vetting Full Revenue Cycle Management Outsourcing
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