Five revenue cycle management tips during medical practice mergers and acquisitions
Healthcare provider consolidation. It’s a phrase we’ve all heard repeatedly in a post-COVID environment where some physicians may find it difficult to practice independently. Costs continue to increase while payments continue to decrease. In its calendar year (CY) 2024 Physician Fee Schedule Proposed Rule, for example, the Centers for Medicare & Medicaid Services announced it would reduce overall payment rates by 1.25%. This and other changes make it harder and harder for today’s medical practices to keep their doors open.
Although the long-term effects of provider consolidation are unknown, one thing is for sure: Smooth revenue cycle management (RCM) is key during times of transition. Without RCM continuity, healthcare mergers and acquisitions can go horribly wrong and even fall apart completely. This article includes five revenue cycle tips to promote successful mergers and acquisitions.
1. Keep a close eye on denials and key performance indicators (KPI).
During a healthcare merger or acquisition, it’s easy for coding and billing mistakes to occur as RCM staff learn new policies and procedures. Monitoring denials and KPIs (e.g., days in accounts receivable, net collection rate, and clean claim rate) is important—particularly in the first few months after the transition. It’s also important to conduct ongoing audits to help revenue cycle staff identify and address any underlying problems that can potentially impact revenue integrity and cashflow. Then provide follow-up education and audit again.
2. Focus on the patient experience.
A healthcare merger or acquisition can usher in a whole host of organizational challenges as RCM staff adjust to new workflows, work demands, and technology. Not surprisingly, it becomes very easy for staff to lose focus and not give patients the attention they need and deserve. As a result, the patient experience can suffer, and practices run the risk of losing patients during the transition, resulting unexpected dips in revenue. Successful mergers and acquisitions engage patients and provide clear and consistent information about what patients can expect during the transition and how the healthcare merger or acquisition benefits them. Leveraging the patient portal is a great way to do this.
3. Prioritize change management.
Change management is an essential element of any medical practice merger or acquisition because it helps promote employee retention and positive morale during times of uncertainty. This is especially true for revenue cycle staff who may need to learn how to navigate a new electronic health record, practice management system, or other health information technology. In some cases, healthcare mergers and acquisitions may prompt the need for RCM staff to move into new roles like financial counselor or auditor. A merger or acquisition could be an excellent opportunity to upskill employees, provide ongoing education, help coders obtain new coding credentials, or explore ways to augment existing staff by partnering with an outsource RCM vendor. It’s also an ideal time to focus on revenue cycle team-building exercises—including developing new relationships between physicians and coders—and on developing a positive work culture. Successful mergers and acquisitions depend on how well the newly combined organization communicates important changes and provides ongoing support.
4. Promote consistent RCM workflows and policies.
Consistent revenue cycle workflows and policies are paramount as medical practices come together as a single entity. Standardized coding policies, guidelines, and workflows promote compliance and streamline efficiency. This is especially important when medical practices have very different policies, guidelines, and workflows—or nothing is formally documented—at the onset of the merger. This includes taking a consistent approach to clinical documentation. Encourage dialogue to reach a consensus that works for everyone while simultaneously promoting compliance and revenue integrity.
5. Don’t forget re-credentialing.
Depending on how the medical practices are integrated, physicians may need to undergo re-credentialing. This is an important step in the RCM process because physicians cannot ensure revenue integrity if they are not properly credentialed with payers. Healthcare mergers and acquisitions are an opportune time to streamline the credentialing process to avoid potential mistakes.
Conclusion
Medical practice mergers and acquisitions are complex transactions with many moving parts. However, it’s critical to ensure business continuity during this time of intense transition. That requires medical practices to prioritize RCM processes and workflows as soon as possible. RCM should not be an afterthought. Learn how edgeMED can help and be sure to check the Healthy Snacks blog for more expert insights, best practices and industry trends.
