Physicians are increasingly likely to turn to outsourced revenue cycle management services as they look to align clinical and financial outcomes according to the recently released 2016 Revenue Cycle Management Survey from Black Book.
The annual report from Black Book, a leading market research firm in healthcare, analyzed key findings from 2,000 independent physician practices and 200 hospital-based physician practices. Their research revealed the ongoing trend that many physicians are turning to outsourced billing solutions to improve their processes and profits.
After reviewing the research, here are the top four takeaways that are significantly impacting independent physicians:
- Inefficient billing processes are common and impacting profit margins.
More than 95 percent of surveyed practice leaders reported inefficient billing processes at their practices, with the majority of medical providers needing to implement backend efforts to process and reconcile bills by this time next year. 100 percent of surveyed practices who switched to outsourcing in 2016 indicated a dropping collections rate and increased time to collect as driving reasons for their RCM change, and of practices who turned to outsourcing since Q3 2015, an overwhelming 82 percent reported receiving fewer rejected claims and receiving payments from payers in less time within two months.
- Many practices, particularly small, independent offices, are unprepared for value-driven care.
The survey found that 9 in 10 practices report being not ready financially and technologically to provide value-based healthcare to their patients. Rising health care costs combined with the complex technology and staffing requirements needed to succeed are creating an urgent demand for cost-effective outsourcing solutions. Furthermore, the increasing emphasis on compliance and risk management are high-impact drivers of the physicians practice outsourcing market. And with nearly all practices with less than five physicians self-identified as “not tech savvy,” outsourcing relieves them of the investment in hardware and applications, training, software upgrades and troubleshooting technical issues that may be too much for most small groups to handle.
- Business and staffing tasks are taking up necessary patient care time.
Many doctors dread handling the business side of their practice, and 77 percent of physicians surveyed believe they need to find more direct patient care time currently taken up by administrative and business tasks for their revenue cycle management. Additionally, 97 percent of independent group and solo practices experience high business staff turnover, with changes in a provider’s billing department being especially damaging. Since claims processing is the economic lifeblood of a practice, any slowdown in the processing of claims is detrimental to the financial security of the business. For practices who recently implemented outsourcing contracts, 81 percent reported staffing concerns falling almost immediately off their radar of high impact problems.
- Physicians are seeking to outsource revenue cycle management more than before.
According to the most recent survey results, the U.S. market for physician revenue cycle management outsourcing and extended business office services is expected to rise 42 percent through 2019, and for smaller practices with less than 25 providers, the market is staged to grow 30 percent in the next year. This trend is even stronger for large groups, with nearly 88 percent of physician groups of 100 or more practitioners are currently implementing partial for fully managed, outsourced business solutions to large clinics and multispecialty groups.
Of the 224 “new” physicians who participated in the survey, 100 percent looked into outsourcing their billing right out of the gate, providing much needed day-to-day relief from the stress of hiring, training and managing RCM employees while launching a new practice. Thanks to the growth in outsourced billing options, new practices have more choices than ever to set up an efficient billing and coding system.