Rethinking patient financial engagement under mounting financial pressure

Many hospitals are still reeling from the financial strain of the pandemic, causing a myriad of concerns regarding hospitals and their financial health. A recent survey of 205 CFOs and VPs from large health systems and physician groups has listed the biggest issues that healthcare financial leaders face regarding the financial health of their organizations. Among their worries were labor shortages, rising costs and inflation, and cybersecurity issues, all exacerbated by the fear of an impending recession.  

Rising costs and inflation 

Rising costs were the foremost concern of these hospital CFOs and revenue cycle VPs. According to data from the American Hospital Association, health systems have experienced surging labor costs, drugs, supplies, equipment, and other vital resources since the COVID-19 pandemic. Rising costs are illustrated with the 19.1 percent rise in labor expenses from 2019 to 2021, supply costs increasing 21 percent per patient overall, median drug costs up 37 percent per patient, and intensive care unit supply costs up 32 percent per patient.  

Rising costs while rising costs may not change soon, providers can offset these costs with a patient financial engagement vendor that can offer a solution to increase earned revenue from patient collections. Vendors that offer a zero-interest, pre-bad debt patient financing solution not only save providers and RCM departments much needed time and resources within the current landscape, but this solution also engages 100% of a provider’s patients – including those who are reluctant or unable to advocate for their own financial health early in their healthcare journey and will not qualify for traditional credit programs. As providers fear rising costs, an effective zero-interest, pre-bad debt patient financing solution increases revenue for the services rendered and infuses hard-earned dollars back into hospitals and health systems. 

Increasing labor shortage  

Nearly every survey respondent reported a severe labor shortage in their revenue cycle management department – with some saying over half of their department’s roles are vacant.  

A recent Becker’s Hospital Review article reports an estimated 1.5 million healthcare jobs were lost in the first two months of COVID-19, and further complications from the pandemic continue to add pressure to an already strained system. The economy has helped create more new jobs; however, healthcare employment remains below pre-pandemic levels, with the number of workers down by 1.1 percent or 176,000 compared to February 2020, and the need for healthcare workers continues to grow, according to the report. The staffing shortage is likely to continue, as indicated by a February 2022 USA Today and Ipsos survey of more than 1,100 healthcare workers. Nearly a quarter of respondents said they would likely leave the field due to the pandemic.  

In March 2022, the American Hospital Association authored a letter to the House Energy and Commerce Committee, calling the healthcare workforce shortage a “national emergency,” Furthermore, the AHA projected the overall shortage of nurses to reach 1.1 million by the end of the year. 

As these issues plague hospitals and health systems, CFOs and revenue cycle VPs are looking for solutions and turning towards automation and technology to fill in the labor gaps and reduce costs. The future of the revenue cycle is trending towards a self-serve, automated RCM model and leveraging comprehensive patient financial engagement platforms to fill the holes in the revenue cycle department. Providers need to find a vendor that is equipped to engage patients in all stages of the RCM cycle, including handling all patient communications regarding patient financing plans.  

Rising cyber security threats 

A third of CFO and revenue cycle leaders cited a struggle with cybersecurity threats to their organization as the main concern. Over half of healthcare organizations have been targeted by cybersecurity attacks, according to a Becker’s Health Article. 

With the mounting financial threat cyber security attacks have on health systems, providers need to ensure their patient financial engagement vendor has a dedicated team tasked with keeping their patient financing operations compliant with a multitude of state and federal laws and regulations, as well as staying up to date on risk mitigation best practices. Integrated throughout all areas of business, CarePayment has a compliance management system that addresses the complexity of new federal & state regulations like the No Surprises Act, price transparency, and income-based payment plan requirements to protect patients. Among other measures, CarePayment’s key implemented systems recently achieved HITRUST Certified status, guaranteeing that our provider partners can spend limited labor resources on what is important – providing high-quality care to the communities they serve.