Nearly 40% of organizations say their collection cost has increased over the past year
SOUTH SAN FRANCISCO, CA., September 15, 2022 /PRNewswire/ — AKASA™the leading developer of AI for healthcare operations, has released the results of a new survey highlighting how hospitals and healthcare systems that leverage automation in the revenue cycle have a lower collection cost to those who do not use automation.
Healthcare finance leaders who use automation in the revenue cycle reported an average collection cost of 3.51% compared to an average collection cost of 3.74% for those not using automation in the revenue cycle, which can translate into millions of dollars saved. The average collection cost declared for the two groups together is 3.68%.
For a health system with $5 billion in turnover, a cost-to-collect of 3.74% is equivalent to $187 million for the income cycle alone. If this healthcare system had the same average cost to recover as organizations that use automation in the revenue cycle (3.51%), that would total $175.5 million in expenses – a saving of $11.5 million.
Additionally, healthcare finance officials were asked about any changes in their cost of collection compared to the same time last year (2021):
- 20.1% reported a decrease in collection cost of 0.1-0.3%+
- 41.1% reported no change
- 38.8% reported an increase in collection cost of 0.1-0.3%+
Cost to be collected is any cost used to generate revenue, which typically includes the revenue cycle holistically: personnel, salaries, and sometimes technology, depending on how the organization operates. The cost of collection encompasses the time it takes to complete revenue cycle tasks like collecting and reworking claims. Chief Financial Officers and Revenue Cycle Managers in Hospitals and Health Systems tell the collection cost is one of the most valuable KPIs for revenue cycle success.
“Automation is the key differentiator when moving the needle on collection cost and creating cost savings at scale,” said Amy Raymond, Vice President of Revenue Cycle Operations. “Although leaders of the healthcare revenue cycle have been trying to cut rates for years, studies show the cost of recovery remained stagnant and this comes up against significant financial pressures that most healthcare organizations face.”
“Through AI and automation, vendors have a proactive and holistic way to improve the revenue cycle and reduce collection costs,” Raymond said. “Strategic organizations are implementing effective AI-powered automation to truly optimize revenue cycle processes, increase efficiency, and focus their employees on the work that brings the most value to the organization. accounts receivable accuracy and efficiency and reduce initial and final denials Charge-offs impact the cost of collections With fewer people touching and reworking claims, the more productive the revenue cycle team is and the higher the cost coverage is low.
Commissioned by AKASA, the survey collected responses from 556 CFOs and revenue cycle managers in hospitals and health systems across United States through the Healthcare Financial Management Association (HFMA) Pulse Survey program between July 8, 2022 and August 2, 2022. The national survey was designed to gauge the adoption of automation in revenue cycle operations in hospitals and healthcare systems across the United States.
AKASA is the leading developer of AI for healthcare operations. AKASA evolves human intelligence with state-of-the-art AI and ML securely trained on customer data to learn unique systems, continuously adapt to changing environments, and provide comprehensive automation and analytics for workflows. complex work. The result is a seamlessly integrated and customized solution that lowers operating costs, frees up staff to do the work they love, and helps healthcare systems allocate resources where they matter most.
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