FEATURE · REVENUE CYCLE MANAGEMENT Is AI in Revenue Cycle’s Future? Experts


Say the Answer is a Clear “Yes, But” Experts, and CFOs in the trenches, agree that revenue cycle management leaders need to buttress their technological and process foundations before they can exploit the potential inherent in AI solutions By Mark Hagland


it’s inevitable that there is now hype surrounding the imminent arrival (and in a very few quarters, actual arrival) of AI and machine learning tools in the revenue cycle management space. But, say experts, not so fast: most hospitals’ and health systems’ RCM infrastructures aren’t yet ready.


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First, the experts say, we need to step back a step and look at the landscape around all of this. As everyone knows, during the spring of 2020, hospital, medi- cal group, and health system revenues crashed after the Centers for Medicare &


ith all the hype surrounding artificial intelligence (AI) and machine learning in healthcare,


with it. But, as has long been noted, for many hospitals and other patient care organizations whose revenue base con- tinues to come overwhelmingly from fee-for-service payment from Medicare and private health insurers (and to a lesser extent, from Medicaid), the income from elective surgical procedures continues to make the difference between a 1- or 2-per- cent revenue margin and a negative one; and as a result, revenues crashed last year healthcare system-wide. Indeed, Indeed, Kaufman Hall’s August 2020 “National Hospital Flash Report,” based on July data from over 800 hospitals, found that hos- pital operating margins had plunged 96 percent in the first seven months of 2020


of financial instability and narrowed revenue margins.


Indeed, automation adoption is accel-


erating in revenue cycle management, according to an Aug. 19 press release announcing the results of a survey con- ducted by the South San Francisco-based AKASA. “The survey found 78 percent of health systems are currently using or are in the process of implementing automa- tion in their revenue cycle operations—a 12-percentage point increase compared to results of last year’s survey,” the press release noted. “The findings signify automation in healthcare is no longer an emerging trend but is mission-critical for driving efficiency and cost-effectiveness in revenue cycle operations.” AKASA CEO and co-founder Malinka Walaliyadde cited the opportunity for provider organizations “to expand their ambitions and scope for automation,” by implementing solutions “that can be deployed rapidly with mini- mal disruption.” Still, the “eternal verities” in RCM


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Medicaid Services (CMS) were compelled to effectively order a halt to virtually all elective procedures in hospitals, clinics, and surgery centers nationwide, as the COVID-19 pandemic exploded across the United States. Provider leaders completely under- stood the order, and universally complied


compared to in the first seven months of 2019, before rebounding later in the year. The roller-coaster of revenues his- tory during 2020 and into 2021, experts agree, has shown hospital leaders how incredibly important it will be to absolutely optimize their revenue cycle management processes, during a period


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remain very important, as revealed in a July 15 report from AKASA, based on a survey of RCM executives. That report found that “[T]he top five measures of revenue cycle operations success, in order of most to least important, include: net days in accounts receivable (in general); aged accounts receivable (billed >90 days); initial deni- als rate; discharged not final billed; [and] final write-offs rate.” And, with regard to that set of issues, Amy Raymond, head of revenue cycle operations at AKASA, says that a core issue that continues to dog RCM leaders is that, “As a revenue cycle leader, it feels as though you’re always behind. Staffing is the first issue. And AR [accounts receivable] is being worked 30-60 days after the moment of service. And as if we needed anything to make things even more challenging, the pandemic came,” she adds. “So the need is, we’re drowning here, we’re buried. Rev cycle has always had to decide which accounts to work, and now, those strategic decisions have been made even harder. It was a perfect storm with the pandemic, with reduced revenues, and changing roles for payers. The need to


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