Eight Trends for Healthcare Organizations in 2020

June 4, 2020

The coming year will require healthcare leaders and financially-minded professionals to be in tune with several industry changes, including consumer-centric billing demands, analytics and automation, threats from EHR interoperability and new prior authorization initiatives.

Eight key trends to watch:

1. Risk will become a bigger part of value-based arrangements. Healthcare leaders will likely see more payment agreements that include both upside and downside risk in 2020, according to predictions from the Healthcare Financial Management Association. These relationships may come through traditional contracting, direct-to-employer arrangements, new health plan partnerships or other approaches.

2. Demand for billing convenience. Healthy revenue streams hinge on patients’ willingness to return to an organization for care. To keep patients engaged with their health system, revenue cycle leaders will increasingly have to make processes, like billing, more convenient to patients, whether that be through mobile payments, payment plans or other options. In 2020, HFMA expects this trend will place a greater weight on providers than in previous years.

3. Scrutiny over balance billing and debt collection tactics. In the next year, revenue cycle leaders may face growing scrutiny of out-of-network balance billing and collection lawsuits. Lawmakers are targeting the two practices at the state and federal level. Rick Pollack, president and CEO of the American Hospital Association, predicted surprise billing specifically will be a key issue in 2020. Benchmarking and arbitration approaches are being considered, and could directly affect health systems’ collection strategy.

4. Analytics becoming norm, but strategic direction needed. In 2020, 76 percent of health system finance executives said they expect to allocate at least 10 percent of their technology budgets toward predictive revenue cycle management analytics. While investments in the area climb, analytics remain severely underused, with much improvement needed in strategic direction and training. Black Book Research found among health system CFOs that implemented analytics programs, only 15 percent reported meaningful use in financial forecasting and strategic planning.

5. Automation’s growing use in prior authorization. The healthcare industry is grappling with massive bureaucracy costs, which totaled $812 billion in 2017. A sizable chunk of that cost is a lack of automation: $13.3 billion in savings could be realized if just eight administrative tasks, including prior authorization, were automated. Big industry players, even CMS, are moving to address burdensome prior authorization processes, with some setting turnaround limits and others banking on automation.

6. Revenue cycle departments will use more AI. In addition to automation, use of artificial intelligence and natural language processing will expand as leaders look to cut administrative costs. AI allows hospitals and health systems to address claim inaccuracies before they’re submitted, cutting down the rate of denials. Natural language processing will help physicians improve clinical documentation and generate claims that accurately depict acuity.

7. Billing improvements countered by lack of EHR interoperability. EHRs have become ubiquitous at hospitals and health systems, but nearly a third of hospital executives say efforts to share data, both with other organizations and within their own system, are insufficient. This affects billing as well, leading many organizations to still rely on time-consuming processes like faxing to transfer billing information. While the Office of the National Coordinator for Health IT has prioritized EHR interoperability improvement, revenue cycle and hospital leaders will need to work on new solutions for this problem in 2020.

8. Billing quality is becoming a physician issue. Physicians will find it more and more difficult to provide care without talking about out-of-pocket costs with patients. Physician leaders from the Johns Hopkins University School of Medicine in Baltimore went as far as to say in 2020 that “billing quality is medical quality.” The topic of cost will likely fuse revenue cycle department functions and clinical operations closer this year, with hopes that increased collaboration will simultaneously improve payment and patient experience, especially among a growing self-pay population. 

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