The media has extensively covered the healthcare workforce shortage and its impact on patient care. It’s a chronic, dangerous problem that seems to worsen, despite the industry’s efforts to staff up. A recent Experian Health survey found severe and long-term implications for revenue cycle management and its impact on provider and patient care. 100% of revenue cycle leaders surveyed agree the pervasive healthcare workforce shortage impacts their facility’s ability to get paid.
The problem isn’t going away; most survey participants (69%) expect recruiting challenges to continue. Furthermore, nine of 10 survey participants admit to a double-digit turnover rate. However, the shortage of qualified labor is impacting healthcare in other areas beyond patient outcomes.
The report shows the bottom line is clear: The healthcare workforce shortage impedes the industry’s ability to get paid. How can providers solve this?
Experian Health’s survey, “Short Staffed for the Long-Term,” polled 200 revenue cycle executives to understand the impact of the hiring deficit’s impact on provider cash flow. Download the survey
Survey Finding #1: Staffing shortages impede payer reimbursements and patient collections.
- 32% of survey participants said patient collections is the revenue cycle channel most impacted by healthcare workforce shortage.
- 22% said payer reimbursements are most affected by staff shortages.
- 43% said both channels were equally impactful to the healthcare revenue cycle.
There was little disagreement in the survey around whether provider revenue cycle suffers from a lack of qualified staff. The debate centered on which reimbursement channel took the biggest hit.
Experian Health’s staffing survey revealed revenue cycle executives agree that collecting late patient payments is much more complicated now. The worker shortage impedes the ability to manage this process. In an era when many patients put off care due to high out-of-pocket costs, maximizing collections is more important than ever.
Short-staffed, overworked healthcare collections teams require the time and tools to optimize the collections process by identifying the accounts more likely to pay. Patient collections teams could also benefit from software that finds financial assistance that could ease self-pay burdens.
Collections Optimization Manager saves staff time by automatically determining the most suitable patient collections approach. The University of San Diego California Health (UCSDH) uses this software to segment patients by propensity to pay. It allows collections agents a more efficient, personalized approach to improve the revenue cycle and the patient relationship. From 2019 to 2021, UCSDH increased collections from $6 million to more than $21 million with this solution.
Patient Financial Clearance automates screening prior to service or at the point of-service to determine if patients qualify for financial assistance, Medicaid, or other assistance programs. Kootenai Health leverages the software, which increased the accuracy of determining patient financial assistance by 88%, and saved 60 hours of staff time through automation.
Together, these tools can ease the healthcare workforce shortage by optimizing and streamlining collections.
Survey Finding #2: The healthcare workforce shortage contributes to increasing denial rates.
- 70% say escalating staff shortages increase claims denials.
- 92% report new staff member errors are a significant factor in delayed or declined reimbursement.
Today, healthcare providers are seeing claim denials increase by 10 to 15% year over year. A lack of qualified revenue cycle staff costs billions annually in preventable revenue cycle errors. 35% of healthcare leaders admit losing more than $50 million yearly on denied claims. The complexities of the revenue cycle particularly challenge new staff; 92% of survey respondents say errors are common.
Denied claims ripple across the revenue cycle, tying up staff time and provider cash flow. Ultimately, it is patients and staff who suffer. When hospitals experience restricted cash flow, it can hamper their ability to effectively deliver the highest quality care. When staff stretch to their limit due to the healthcare workforce shortage, they may make more errors, burnout, or quit.
Franklin Healthcare Associates, a 100-provider, four-location practice, used Claim Scrubber to reduce accounts receivable (A/R) by 13%. As claims volume grew, the practice decreases its full-time employee (FTE) requirements by leveraging this automated tool. It’s one clear example of how technology can stretch staff farther to improve the bottom line.
Survey Finding #3 Staffing deficits aren’t going away.
- Close to 70% of respondents believe revenue cycle staffing levels will continue as a problem into the future.
- Staff turnover is a contributing factor; 80% said their organization’s turnover revenue of cycle management staff is between 11-40%.
Experian Health’s survey confirms that healthcare teams struggle to find qualified staff. Staff turnover is a significant contributor to a revolving hiring door. One survey showed the average hospital turnover rate is 100% every five years. Traditional solutions to the problem include throwing more money into salaries, bonuses, or other perks. Overtime is a go-to remedy for the chronic healthcare worker shortage. But these approaches strain the provider bottom line. A recent Kauffman Hall survey shows:
- 98% of healthcare providers have raised minimum wage or starting salaries.
- 84% offer signing bonuses, and 73% offer retention bonuses.
- 67% experienced wage increases of more than 10% for clinical staff.
The American Hospital Association (AHA) states, “Hospitals also have incurred significant costs in recruiting and retaining staff, which have included overtime pay, bonus pay and other incentives.” But what if recruiting isn’t the answer to the healthcare workforce shortage at all?
Artificial intelligence (AI) and automation software can help cut costs and lessen the workload of existing staff. The latest data suggest providers could save close to $25 billion annually (one-half of what they spend on administrative tasks) if they leveraged these tools.
Experian Health’s AI Advantage™ uses powerful algorithms to automate manual claims processes to reduce denial and lessen the volume of tasks for revenue cycle staff. The software works in two critical areas:
- Predictive Denials proactively cleans claims before they are submitted. The software flags claims at risk of denial, allowing manual intervention for a clean submission—with no denials.
- Denial Triage manages denied claims by identifying the highest value reimbursements to maximize cash flow. Instead of chasing low-value claims or those least likely to pay, the software prioritizes where revenue cycle staff should spend their time for the greatest return.
Schneck Medical Center saw significant ROI from this software in just six months. AI Advantage helped the facility reduce denials by an average of 4.6% per month. Claims corrections that took up to 15 minutes in the past now take under five minutes.
Better software can do more than help hospitals get paid faster. Automating revenue cycle management processes frees up staff time. More time and less pressure mean fewer mistakes.
Automation can ease the impact of the healthcare workforce shortage
Two of the most pressing problems hospitals face today are the healthcare workforce shortage and revenue cycle impediments that keep them from getting paid. These challenges interconnect, and providers can solve them both with better technology to automate time-wasting manual functions.
AI and automation in healthcare can cut costs and reduce staff burnout. Deploying revenue cycle software to automate billing, claims management, and collections could save $200 billion to $360 billion in spending in this country. These numbers are real. But so are the numbers showing increasing claims denials, staff burnout, turnover, and difficulties recruiting in the healthcare field. Today, the answer for hospitals to get paid faster is to leverage modern technology to improve the revenue cycle.
Learn more about how Experian Health’s revenue cycle management solutions can help automate common processes, and download the new survey to see the latest healthcare staffing shortage stats.