Knowledge Center

Specialty healthcare practices currently face a number of new challenges to their established reimbursement strategies and revenue cycle management (RCM) processes.  As bundled payments, value-based care contracts, and other risk-based models gain ground across the nation, specialists are finding it challenging to maintain financial performance goals which depend in part on negotiating favorable terms with payers.

As we have explored in previous blog posts, specialty care frequently demands the efficient delivery of high-value services – often in large volumes within a short period of time.  The failure to recognize and react quickly to inaccurate or denied payment for even a small subset of these activities dramatically skews a practice’s financial results.  It is critical to equip RCM staff to know exactly what to expect from their payers – and when to expect it.

Full visibility into payer contracts, combined with the ability to manage these contracts in a proactive manner, is key to maximizing reimbursement for clinical services including the administration of high value pharmaceuticals and other therapeutic modalities.  According to the Texas Medical Association, practices that do not adequately track and manage their payer contract rates experience revenue reductions averaging 4 percent (4%) below their peers who employ strong contract management processes.

In contrast, use of a comprehensive, highly integrated health IT solution to manage payer contracts, reconcile charges with payments, and identify opportunities for contract performance improvement boosts the sustainability of specialty practices while simplifying contract management workflow.

Examining the challenges of payer contracting for specialty practices

The healthcare payer landscape is incredibly diverse, running the gamut from plans with tens of millions of members to those with just a handful of beneficiaries in a specific region.  Specialty practices must carefully asses their local mix of coverage options to choose which payers to contract with and how to structure those agreements.

These decisions are becoming even more complicated due to the rise of bundled payments, episodic payment models, and risk-bearing contracts aimed at improving outcomes and controlling the costs of specialty care.

Negotiating favorable contracts requires a complete understanding of the terms and conditions in these binding legal agreements, including fee schedules for included services, base rates for common services or pharmaceuticals, definitions for the amount and frequency of reimbursement increases, and clear timeframes for payment.

Practices must be able to easily evaluate how proposed contract terms will impact their revenue cycle operations, from clinical documentation inputs to billing and coding standards to claim outputs.  This is especially important for value-based care models where correct documentation and coding can mean the difference between earning incentive payments and owing a percentage back to a payer.

Once a contract has been negotiated and is in effect, RCM staff must be able to quickly and accurately flag variances in payment rates, contest underpayments or denials appropriately, and collect outstanding revenue in a timely manner.

Staff members must also stay aware of renewal windows, negotiation deadlines, and fee schedule changes so their practice can remain nimble and proactive when discussing contracts with payer partners.

Developing a streamlined, efficient contract management process

In order to overcome these challenges, practices will need to employ a combination of workflow changes and sophisticated health IT solutions.

Practices can begin by making sure they stay ahead of regular cycles of contract negotiation and fee schedule changes.  Most payers operate on the calendar year, making changes quarterly or yearly.

Specialty groups should maintain a master list of contact information for each contracted payer in case of questions or disputes about reimbursements.  This documentation should also contain information about contract expiration dates and the timing of fee schedule adjustments to help RCM staff stay on top of their activities.

Provider organizations should update the business rules in their revenue cycle management solution quickly when contract changes are announced to prevent days, weeks, or months of invalid charge accrual, improper claim filing, and preventable denials.  Taking this recommended baseline step will avoid the need to spend manual time and effort adjusting charges and reconciling variances after errors have been made.

RCM solutions should have deep integration with clinical documentation, billing, and coding functions to give staff members a complete, accurate, and timely view of reimbursable charges.  This visibility makes it easier to automatically flag incorrect payments and identify emerging patterns in clinical care that may affect future negotiations.

For example, if sub-specialty expansion leads to increased use of an effective pharmaceutical or medical procedure, the aware practice can prepare for payer discussions focused on securing a targeted reimbursement rate increase that is specific to the increasingly significant service(s). Focusing contract negotiation efforts on smaller groups of frequent services rather than a broad, general reimbursement increase will enhance the likelihood of securing a material revenue increase, especially for specialist groups that routinely utilize high-dollar drugs and complex clinical services.

Perhaps most importantly, practices should ensure that all RCM and payer contract negotiation staff are on the same page about what role technology can play in improving the process.

Oftentimes, the person in charge of working directly with payers does not use the practice’s RCM software on a regular basis and may not understand the importance of sharing key contract information with the rest of the team.

Practice leaders should consider investing extra time in making sure these conversations happen on a regular basis and that all staff members are working in a coordinated, proactive manner to support the practice’s financial health.

Preparing specialty practices for a sustainable financial future

Taking a more structured approach to contract management, with the help of a well-qualified and robust RCM solution, can allow specialty healthcare practices to stay ahead of their finances today while preparing for tomorrow.

With the right technologies and workflows, bundled payments and risk-based models do not have to be prohibitively complex to administer.  Practices which prepare themselves now with strong contract management competencies will be well-positioned to take advantage of emerging innovative reimbursement models designed to bring benefits to payers, providers, and patients.

By keeping track of contract negotiation cycles, proactively identifying areas of financial focus, and leveraging health IT tools to flag discrepancies and report on variances, specialists can maximize their reimbursement opportunities as the financial landscape continues to evolve.

Specialty practices play an essential role in the healthcare ecosystem, offering expert diagnostics and innovative treatments for the most challenging patients.  Specialists who focus on the very cutting edge of medicine work in an extremely complex clinical and financial environment that is fundamentally different from primary care or the inpatient setting.

Specialists such as oncologists, rheumatologists, and gastroenterologists often utilize high-intensity treatment plans, frequent lab work, consultations with other clinicians, and a variety of pharmaceuticals to treat their patients.

All of these services must be documented in detail, shared with the revenue cycle management (RCM) team, coded appropriately, and billed in a timely manner before the practice can be reimbursed for its efforts.  In specialty care, where high cost therapies and treatments are common, any bottlenecks in the reimbursement process can have significant consequences for the sustainability of the healthcare enterprise.

While electronic medical records (EMRs) and other health IT systems have made it easier to generate digital data and documentation, the healthcare system is still struggling with how to capture, share, and leverage that information for improved clinical and financial outcomes.

Activity capture, also known as charge capture, is a key part of the revenue cycle in specialty healthcare.  Optimizing and automating the activity capture process will create complete and timely records of the clinical interventions taken to support better patient care while ensuring compliant reimbursement and minimizing charge loss.

Examining the challenges of activity capture in specialty settings

In order to create a comprehensive, curated view of all the activities related to a specific patient, practices need to identify every relevant clinical service item, extract that information from its point of origin, and synthesize the data into a single view for subsequent use.

As discussed in the previous blog post, rich interoperability between disparate systems is crucial for ensuring visibility into the entire spectrum of patient activities.

However, many existing health IT solutions are limited in their capacity to do this effectively enough to meet the specific requirements of specialty practices.  As a result, billers and coders are often forced to manually merge and examine hundreds of items line by line, which can be extremely time consuming and prone to natural human errors.

Identifying opportunities to improve RCM with automated activity capture and claims edits

Incomplete or inaccurate activity capture puts the revenue cycle in jeopardy.  Without a full and accurate portrait of resource consumption – and detailed clinical documentation to justify the use of each service or therapeutic – practices typically experience claims denials and delays.

Even a simple error like a mismatch between the dosage of a medication prescribed in the EMR and the record of what was removed from a drug inventory management system can turn into a major problem for reimbursement.  If the practice is not able to pull data from both the EMR and the drug cabinet to compare and reconcile the two pieces of information, the practice could incur thousands of dollars in lost income.

The ability to automate the identification and correction of such errors takes true specialty-focused RCM platforms to the next level.  While health IT tools will never replace the enormous wealth of knowledge and critical thinking that an experienced coder brings to the process, sophisticated digital tools can make human billers and coders significantly more efficient.

For example, radiation oncology clinics often reassess a patient’s treatment parameters and verify radiation dose accuracy after every fifth visit.  These continuing sessions are reimbursable when billed under their own CPT code.  Without revenue cycle system assistance, a coder would have to manually keep track of whether or not every patient has reached his or her fifth treatment visit and add proper billing codes manually where justified.  In contrast, a specialty-friendly claims edit solution can alert to the opportunity for appropriate and complete coding and in some cases even propose to complete the step independently.

Without comprehensive activity capture and intelligent claim edit capabilities, a practice may miss out on legitimate revenue opportunities or leave themselves open to costly errors.  Practices that continue to rely on fully manual coding and billing also risk a slower revenue cycle with claims stuck in lengthy processing queues, which can lead to financial instability.

Looking forward to the future of RCM for specialty practices

Advanced activity capture creates more efficient workflows for RCM staff members as they prepare claims for reimbursement.  With digital solutions for activity capture and claim editing, specialty practices can reduce pain points, speed up the reimbursement process, and allow RCM staff to focus on complex decision-making instead of spending time on simple, tedious tasks.

Practices that invest in tools that can extract critical information from every relevant health IT system, synthesize that data into a global view of clinical treatment activity, and actively suggest claim edits to enhance reimbursement, will position themselves for success in a challenging financial environment.

With a detailed, accurate, and comprehensive view into the clinical and financial activities involved in patient care, practices can maintain their business operations and begin to identify additional opportunities to improve their processes or expand their service lines.

This complete visibility into resource utilization can help specialists take the next big step into enhancing their revenue cycle performance: adopting a proactive approach to managing payer contracting and drug pricing.

In our next blog post, we will discuss the need for specialty-specific RCM solutions that offer contract management capabilities and robust reporting to give specialists the edge when negotiating with healthcare payers.

No matter what the setting or specialty, all healthcare delivery is founded upon the ability to access information.  Accurate and complete data about demographics, insurance coverage, clinical history, test results, and treatment goals are all vital for clinicians looking to make the best possible decisions with their patients.

In recent years, the vast majority of this data has gone digital in an effort to make it easier to analyze information and apply new insights to patient care.  But despite the ubiquity of electronic health records (EHRs) and countless other health IT systems, the digital care continuum is highly fragmented and siloed.

The interoperability problem can be particularly pronounced in the specialty care environment, where a myriad of clinical tools collides with the need for highly complex, detailed decision-making.

Improving the interoperability between their clinical and financial systems will help specialists develop the comprehensive, current, and accurate portrait of rendered services required to correctly document, treat, and bill each patient encounter.

Examining the challenges of activity capture and data interoperability

While the healthcare industry tends to think about interoperability as basic connectivity between EHR systems necessary to share patient charts, the reality of health data exchange is far more nuanced, especially outside the worlds of primary and inpatient care.

Some specialty providers may work with the same patient for months or years to treat cancer, kidney disease, diabetes, or heart disease.

For long-term, highly complicated conditions such as cancer, a single patient can require input from more than half a dozen health IT systems, from drug dispensing cabinets and imaging machines to multiple EHRs, patient wearable devices, scheduling tools, and a revenue cycle management system.

Patients may require visits on a weekly or daily basis to receive chemotherapy or radiation treatment.  They may need extremely expensive pharmaceuticals, multiple physician consults, and regular lab work to track and treat their disease.  And they might work with additional specialists in pain management, nutrition, behavioral health, or surgery to holistically address their health.

Every one of these services must be scheduled properly, documented completely, coded to the highest degree of accuracy, and billed correctly and efficiently – all while maintaining compliance with the various privacy, security, and patient data access rules that govern the flow of health information.

Adding to the challenge is the fact that many of these systems do not currently share technical standards that would allow for the free flow of data across disparate systems.  The result is often inefficient workflows, gaps in clinical information, and missed opportunities to code and bill for services.

With so many different moving pieces, it’s no wonder that practices are finding it frustrating to accurately capture activity and compile a comprehensive portrait of services, diagnoses, and reimbursement for each individual.

In a 2019 survey conducted by the Center for Connected Medicine, close to a third of providers said they still struggle with sharing medical data within their own organization.  Nearly double that number cannot routinely communicate with other health systems or additional healthcare partners, which can have heightened impacts on specialists who tend to work with a greater volume of external referrals.

More than 30 percent of providers said that these interoperability challenges directly impacted patient care.

For more than half of respondents, the solution lies in a combination of strong executive commitment to improving interoperability and adopting new technology solutions to enhance connectivity and ensure complete activity capture.

Connecting the dots between clinical and financial systems

Overcoming the divide between health IT systems in specialty care starts with recognizing the unique interplay of clinical, administrative, and financial systems.

In many specialties, for example, clinical factors impact whether or not a patient can schedule their next step in therapy.  As a result, providers use their clinical system to book appointments – and they need access to the most current test results and reports in order to do so.

The timing of appointments and other clinical decisions can also depend on administrative issues, such as prior authorizations and insurance coverage.  Clinicians must be aware of any potential restrictions at the point of care so they can discuss these dynamics with their patients and caregivers.

Creating rich connections between the clinical, financial, and administrative environments is essential for developing seamless care plans that account for all the variables involved in specialty practice

Organizations should start this process by identifying all of the health IT systems in use and mapping the desired connections between them.  If the tools cannot communicate appropriately, providers should consider a customizable interoperability solution to capture activity from every critical endpoint and synthesize the data into a unified, accessible view.

Further aligning these branches of health IT through use of a specialty-specific solution will enable higher quality patient care and more stable billing operations.  By choosing a vendor clearly focused on specialty care, adoption of a new platform drives accelerated payback and avoids or minimizes clinical care disruption.

Embracing automation to enhance efficiency and outcomes

With an interoperable clinical and financial environment, organizations can start to trust that their data is complete, accurate, and timely enough to use for patient care and broader strategic decision-making.

They can also begin looking at automation as a way to improve efficiency, reduce waste, and bolster patient outcomes.

Using cancer care as a specialty healthcare example, a typical oncologist generates more than 80,000 billable line-items per year – yet practices still conduct many of their revenue cycle management tasks manually.  In such environments,  the sheer volume of unique codes and modifiers used for medical service billing, many of which are tied to detailed payer-specific rules, are easily missed when working on such a large scale.

As coding and billing become ever more complex with the expansion of value-based care reimbursement models, specialty practices will need to rely more heavily on technology to make sure they are capturing patient data correctly and receiving appropriate reimbursement.

Interoperability solutions that provide strong links between clinical data inputs and financial systems outputs encourage more accurate documentation, speed up claims processing, and avoid denials that cost the practice time and money.

Meaningful interoperability between clinical and financial ecosystems is the first step towards automating the reimbursement process.  By improving visibility into the entire scope of patient activities, specialists can make better decisions about the health of their patients and the wellbeing of their practice.

In our next blog post, we will take a deeper look at how interoperability supports improved charge capture and more efficient billing to keep specialists thriving in a changing financial environment.

Revenue cycle management (RCM) is a mission-critical concern for all healthcare organizations. The quality of revenue cycle outcomes impacts every element of patient care. A practice’s ability to sustain high-quality care delivery depends on accurate clinical documentation and clear communication between payers, providers, and patients combined to drive timely reimbursement.

Over the past decade, many health systems and physician practices have started to automate their RCM processes, leading to greater efficiencies and better patient experiences. But a number of significant challenges remain, particularly for specialty healthcare providers.

In the specialty environment, revenue cycle management is particularly complex.  Medical disciplines such as rheumatology, oncology, ophthalmology, and gastroenterology, for example, must address a range of administrative and financial challenges which have exaggerated impact on financial performance relative to their peers. Whether it’s completing prior authorizations, contracting under Advanced Payment Models (APMs), or synthesizing the enormous volume of clinical and financial data generated by sophisticated medical devices and platforms, specialists require a data-driven RCM strategy that links clinical decision-making and the business office in a seamless, intuitive way.

In this new six-part blog series, we will explore the top challenges to effective revenue cycle management in the specialty healthcare context and discuss some of the most impactful strategies and tools available to support an effective and patient-friendly process.

1. Advancing interoperability between clinical and financial systems

Data interoperability is the foundation for success in the modern healthcare environment. During a specialty healthcare encounter, a single patient can touch more than a half dozen health IT systems including dedicated imaging and radiation therapy applications, digital medication dispensing platforms, clinical laboratory and pharmacy solutions, and electronic medical records.

All of these platforms capture an incredible volume of clinical activity. Systems interoperability is key to assembling a comprehensive, up-to-date portrait of the patient’s clinical status – and an accurate record of the reimbursable services provided.

Specialty providers need to develop a data infrastructure that readily supports the coordination of clinical activity capture, presents a holistic view of the patient’s status to clinicians, and ensures that related financial information is integrated appropriately into business office workflow. This seamless approach to interoperability can support some of the critical functions unique to specialty care, such as considering prior authorization requirements when designing a treatment plan or predicating future patient appointments on the achievement of regimen-driven clinical milestones.

2. Ensuring complete and accurate charge capture

Interoperability across clinical and financial environments creates the ideal conditions for accurate charge capture, coding, and billing. Because many different systems generate information necessary to treat highly complex medical cases, practices require automation to ensure that medical claims include sufficient detail about a patient’s diagnoses and treatments to qualify for appropriate reimbursement.

With the right tools, administrative staff can access an integrated history of activity from multiple data streams, identify potential discrepancies between charge capture and code-specific documentation, and take advantage of automated compliance and revenue cycle integrity rules in order to verify the full treatment picture for every patient.

Activity (charge) capture is particularly important for the growing number of specialists participating in value-based care models or bundled payment programs. When managing care in the context of capitated payments and/or ambitious clinical and financial benchmarks, practices need to be confident that they are fully accounting for all clinical practice-driven expenditures. Cost accounting methodologies depend on a full and accurate picture of resource consumption.

Appropriately detailed diagnosis codes are also essential for risk adjustment calculations that may impact incentive payments or reimbursement rates. An RCM platform tailored to the needs of specialty care can help providers succeed in the growing number of value-based care programs aimed at improving quality and reducing costs in complex medical delivery settings.

3. Staying on top of payer contracting and drug pricing

Specialty healthcare often involves cutting-edge pharmaceuticals and other therapies drawn from the higher end of the cost spectrum. Both payers and providers want to be sure these treatments are accessible to patients without contributing to the challenges known to plague the healthcare system.

Because of the rapid pace of innovation and the need to monitor spending, payers change their drug reimbursement rates frequently. For example, the Centers for Medicare and Medicaid Services (CMS) updates its Medicare drug reimbursement rates on a quarterly basis. Many of the nation’s largest private payers follow the same schedule, leaving specialty providers scrambling to keep up with the constant adjustments.

Even a small tweak in reimbursement for a high-cost drug can dramatically alter a practice’s financial projections, so providers need to maintain full visibility into their payer contracts, payment rates, and patient populations at all times.

Employing an RCM solution with highly capable contract management features and differentiated by flexible reporting is an important and necessary step in managing payer contracts and drug pricing updates. Particularly given the expectations of high service volume common in specialty healthcare today, it is critical to leverage RCM systems that can reduce burdens on administrative staff, support flexible adjustments to financial projections, aid in compliance reporting, and help practices maintain sustainability in a quickly changing financial environment.

4. Managing prior authorization to reduce delays in treatment

For many specialists, prior authorization is a source of deep frustration. The process can seem opaque and onerous, but it does play an important role in controlling costs and ensuring providers utilize evidence-based medical protocols.

Practices are responsible for making sure that every patient’s treatment plan adheres to the unique requirements of his or her insurance coverage. Because prior authorization is not one-size-fits-all for payers, specialty practices benefit by adopting technology platforms that can handle significant aspects of the prior authorization process via customized, automated workflows designed to meet each payer’s requirements.

Providers who focus on fostering an interoperable, data-driven environment are able to leverage their technology tools to react effectively to provider declarations of treatment intent, acquire and archive supporting clinical documentation, and capably meet other payer-specific requirements to expedite approval of important patient care.

5. Ensuring operational efficiency to enhance patient engagement and satisfaction

All of these challenges relate to the goal of increasing operational efficiency across the entire practice. Employing robust, integrated, and intuitive technology tools is crucial for practices that wish to improve their back-office operations – and their front-end patient experiences, too.

With an RCM solution that provides more visibility around the entire cycle of patient care, practices can engage patients more efficiently with less time and manual effort. This includes automating intake processes with strategies like notification delivery via text message or the deployment of mobile, self-service sign-in features.

Individuals facing serious health issues also need simple and convenient ways of handling their out-of-pocket financial responsibilities. Digital self-pay features can improve collections while reducing stress and anxiety for patients, resulting in higher patient satisfaction scores and more positive patient-provider relationships.

As specialists continue to adopt the latest in clinical technologies, patient engagement tools, and reimbursement strategies, those solutions will depend on the quality and capabilities of the underlying RCM platform. An RCM application that is tailored to the complex needs of specialty healthcare provides the foundation for smoother payer transactions resulting in sustained financial success for the practice and ultimately better clinical outcomes.

Coming up next

Throughout this blog series, we will examine each of the top five revenue cycle challenges faced by specialty healthcare in more detail to provide actionable insights for specialists looking to improve their revenue cycle management outcomes. Stay tuned for our next article – a deeper dive into the strategies and technologies required to start building an interoperable RCM environment in specialty healthcare.