"Struggling" Hospitals Have No Money For New Revenue Cycle Tools

By Katie Wike, contributing writer

Many hospitals want to replace outdated financial systems but the funding is not available for the majority of them.

According to a new survey from Black Book Rankings, many hospitals are concerned that updating their old Revenue Cycle tools will deplete their cash reserves and leave them with no savings.

Health IT Analytics reports of the more than 2,300 hospital CFOs, CIOs, business office managers, and technical staffers surveyed, 40 percent admitted they were “struggling” to maintain solvency. Often, this is a result of failed investments in electronic health records (EHRs) and patient portals.

These “struggling” organizations say they are forced to postpone their adoption of new RCM until 2016 due to depleted cash reserves.

“Most hospitals have no choice but to look for next generation RCM solutions in order to keep their organizations solvent,” said Doug Brown, Managing Partner of Black Book. “Increased self-pay volumes, lack of pricing transparency, no patient financial responsibility/estimation technology, and other reimbursement challenges are driving many marginally performing healthcare organizations to the brink.”

In fiscally sound organizations, 91 percent have either fully committed to next generation revenue cycle management, currently have implementations underway, or plan on either outsourcing or purchasing new RCM software by Q3 2015.

“Hospital viability has never been more thoroughly secured to a single organizational venture as revenue cycle management transformation,” said Brown. “And chief financial officers in struggling hospitals are in a very perilous position as the risk models are still being charted while limited funds remain for next generation RCM tools.”