RCM tools ill-suited for payment reform
June 22, 2013 in Medical Technology
You’d be forgiven for thinking revenue cycle management technology is a bit, well, boring. You’d also be wrong. The coming years are going to see some big changes in the way hospitals get paid — and the IT they use to track when and how they get paid is going to have to change as well.
“There’s a new future for revenue cycle,” say John Hoyt, executive vice president of HIMSS Analytics. “We’re predicting the future here.”
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RCM tools are a varied cohort. Many of them are fairly standard business technologies, such as admissions/discharges/transfers and registration systems, credit and collections tools and patient billing and scheduling technologies.
All of those are well established at U.S. hospitals. The market is about as saturated as can be, in fact, according to HIMSS Analytics numbers. Penetration is as high as 97.9 percent for patient billing tools; all the above-mentioned technologies clock in at 90 percent or more.
Still, even those well-situated types are probably soon due to be replaced. Most have been installed for a decade or so already.
“We’re looking at ages 8 to 11 years for these revenue cycle systems” says Hoyt. “Patient billing is different from registration is different from scheduling, but they’re generally up there: 8 to 11 years. And that’s basically the kind of thing that the auto industry watches. How old are the cars on the road? There’s a point at which people just have to start buying new cars.”
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There are more fundamental changes in the offing, he says.
“We have a new future with Medicare on payment reform. We’ve been nipping away at trying to save money in Medicare for years, but we need fundamental change, and we all know it. And it’s coming in the form of ACOs or bundled payments and this type of thing.”
Says Hoyt: “The revenue cycle systems we’ve had, for the past 10 years, are not prepared to do that.”
Further down HIMSS Analytics’ list of RCM tools, there’s a class that’s so-far seen less market penetration than standard business technologies. Electronic data interchange (electronic billing and receipts, basically) is well established at nearly 85 percent of hospitals, for instance, but past that, other species of IT are still relatively immature.