By Pamela J. Gallagher
The emergence of artificial intelligence (AI) is the topic on every healthcare leader’s mind. In many ways, though, AI is old news to those of us in healthcare finance. I can say from experience that once an AI technology comes onto the scene, there is no stopping it. AI is here to stay. The question leaders must grapple with is how to embrace it wisely and with purpose.
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Everywhere I see headlines about “The Great Resignation.” Many are pontificating about why people are leaving jobs or about unemployed individuals’ motivations for choosing to delay looking for a new position. However, I am particularly concerned with the employees who are left behind to pick up the slack as open positions remain unfilled.
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Healthcare organizations spend tens of millions on sophisticated data collection and storage, yet it is hard to define what data is worth to an organization. What is its true value? This depends entirely on how the organization uses it. If an organization does not understand how to interpret and make use of their current and historical data, they will not optimize the return on this significant investment.
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Hospitals and health systems have spent the past decade responding to patient and government demands for increased price transparency, and the demand only continues. While the healthcare industry has made strides in ensuring patients know the cost of their care up-front, consumer expectations are growing to include that hospitals should be able to explain how their costs are determined.
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Patients have been begging for affordability for decades, and the healthcare industry’s reluctance to innovate and adapt to patient demands has left a door open for retailers to move into the healthcare business. I believe this will be great for healthcare, but potentially disastrous for health systems.
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In 2019, emergency departments (ED) across the U.S. saw an average of 2.1 million patients per week, according to the Centers for Disease Control and Prevention (CDC). Over the past several decades, healthcare organizations have invested large amounts of money, time, and effort to study the trend of ever-increasing numbers of high-utilizers in the ED and discover solutions to slow this growth. Hospitals have offered care navigators, clinics for less emergent issues, and countless other alternatives, but with next to no progress. People, it seems, just wanted to come to the ED.
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There is reluctance in the healthcare industry to adopt new price transparency technology. Some healthcare providers are ignoring it all together, saying they’ll wait and see if anything comes of it.
But this technology isn’t “coming.” It’s already here. With the technology in place and demands for increased affordability coming from consumers and legislators alike, this technology is just one little tilt from being mainstream—and I believe that it can change the healthcare industry for the better.
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With increased calls for healthcare pricing transparency from consumers and government entities alike, hospitals’ chargemasters are moving from proprietary information to public knowledge. However, putting chargemasters under the microscope has not led to the clarity that patients are seeking regarding quality care at a price they can afford.
Nearly two-thirds of physician respondents in a 2019 NEJM Catalyst survey said that patients do not have enough information to affect the cost of their own healthcare–related decisions, and more than three-quarters of respondents say that assessing the total cost of care is extremely challenging for patients.
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A hospital’s charge description master (CDM), or chargemaster, is often referred to as the “heart” of the healthcare revenue cycle. It includes codes for every procedure, material used, medication, and service that a healthcare organization provides its patients. It is the structure that drives the hospital, and is the starting point for billing patients and insurers and complying with public reporting. A typical health care system chargemaster may contain 15,000 to 25,000 entries, according to Becker’s Hospital Review.
Read MoreBy Pamela J. Gallagher
The business world seems to be moving in the direction of business process automation, yet in the healthcare industry only about 20% of provider organizations are widely engaging in hospital financial automation, according to a new Black Book CFO survey.
Automation can result in immediate cost savings, the elimination of duplicated tasks, and improved visibility. For the healthcare industry in particular, the automation of business processes can result in improved compliance, elimination of errors in workflow processes, enhanced vendor management, and better billing practices, to name a few.
So why are so few hospitals adopting automation for their back-office processes? I believe it’s because they have seen that automation technology doesn’t always save money as it claims. I have learned that when automation is employed without critical thinking around cost and workflow efficiency, the result is automation that will only produce unwanted outcomes—faster.
Consider the actual cost.
I don’t want to come across as overly negative toward technology—I love technology! My doctoral studies examined impact of computerization on business administration in healthcare industry. However, through the course of my research, I learned that despite promises to the contrary, technology doesn’t always save you money.In many cases, the difference in cost savings between companies that had completely automated their business functions and those that didn’t use automation at all was negligible.
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