The Overlooked Solution That Hospitals Miss
Hospitals continue to face rising costs ranging from building expenses to staffing to admin costs related to billing. While hospital administrators frantically search for ways to plug costly leaks, they might be overlooking one of the biggest solutions: turnaround time (TAT). TAT is the measure used to determine the time between the hospital billing for services and the hospital receiving payment for those services.
Even a smaller facility can run a daily operational bill of $3-5 million, which means daily payments are essential for even short projections of expenses that can be incurred for growth or equipment procurement. New equipment, superior physicians, and a great reputation are the baseline of needs for collections, utilization, and distribution of daily cash flow.
In addition to normal costs of running a hospital, there is financial pressure on hospitals for precise initial care assessments (Core Measures), correct care (Quality), proper physician documentation (Coding), and post-procedure follow-up and standards of care (Preventative Health). These items not only prevent paybacks or insufficient payment for care, but also protect the hospital from lawsuits. Considering that healthcare bankruptcies more than tripled in 2017 it seems worth asking, “What can we do to fix this?”
This is where the often-overlooked detail of turnaround time becomes so important. The speed and efficiency of a revenue cycle could be the difference in millions of dollars left on the table. Based on our earlier statistics, that means a hospital’s financial survival is dependent on how fast a bill is processed and payment is received.
Many successful hospitals use Healthcare BPO companies to address these challenges. This model has many benefits for the hospital – cash flow, facility space, decreased internal costs, and greater efficiency. The case for Healthcare BPO is proving most beneficial in Coding and Billing services but also in CDI and Utilization Management. Shearwater takes it a step further than most with a focus on CPO® (clinical process outsourcing) which includes dedicated clinical teams for our hospital clients and a “code while you sleep” mentality that paves the way for concurrent coding.
Utilization of a Healthcare CPO to increase TAT may determine the futures of hospitals that are at risk with the ever-changing challenges that hospitals face.