Optimizing the Revenue Cycle: Insights from Leslie Vairo, Senior Consulting Director at Vizient
In today’s complex healthcare environment, optimizing the revenue cycle is more crucial than ever. As healthcare systems face increasing financial pressures, effective revenue cycle management (RCM) is essential for maintaining both operational efficiency and financial health. Leslie Vairo, Senior Consulting Director in Revenue Cycle at Vizient , is at the forefront of helping health systems navigate these challenges. With her broad experience in healthcare and finance, Leslie's expertise is key to helping enhance hospital operations and maximize revenue streams.
As a leading healthcare performance improvement organization, Vizient partners with more than half of US healthcare organizations. The organization provides end-to-end assessments that help organizations improve performance, increase revenue, and optimize their operations.
By working closely with health system leadership, Vizient conducts assessments of the revenue cycle process, that include denials management to coding accuracy, identifying areas where there is revenue leakage. The goal is to develop long-term strategies for sustainable improvement.
During assessments, Leslie noted that Vizient often encounters recurring issues that contribute to lost revenue
- Denials Management: Often, hospitals struggle with authorization errors, inaccurate coding, and unresolved payment issues, all of which can delay or prevent reimbursement. These issues are exacerbated by outdated systems and a lack of standardized processes across different payers, especially with Medicare and other insurers that have different billing guidelines.
- Aging Coding Staff & Coding Accuracy: The healthcare industry faces a growing shortage of qualified medical coders, which has led to an aging coding workforce. In addition, Leslie noted that coding accuracy is a major issue, with some facilities reporting accuracy rates below 90%. Hospitals often don’t realize how much this shortfall costs them in lost revenue. The financial strain is also compounded by the backlogs of charts that is a direct result of the medical coding staff shortage.
- Revenue Leakage: Underpayments or overpayments are another key issue that delays revenue flow. Often referred to as revenue leakage, these discrepancies result from inefficient claims processing or errors in billing, leading to delayed or lost payments. Leslie’s assessments reveal that many hospitals have significant opportunities to recoup revenue by improving accuracy in their coding and billing procedures.
Hospitals are often eager to invest in new technologies, but Leslie points out that technology alone is not enough. Many hospitals purchase systems like EPIC or are now considering AI, hoping the technology will automatically improve their revenue cycle performance. However, without addressing the people and processes that drive the technology, the return on investment (ROI) is often limited. Hospitals must focus on aligning technology with the necessary skill development and change management to maximize its effectiveness.
One of the barriers Leslie encounters is the resistance to change from hospital staff, particularly when it comes to legacy teams that have not looked at or updated their program’s operations. These barriers can be especially pronounced when hospitals are presented with data analysis that shows they are leaving millions of dollars on the table due to inefficiencies in their revenue cycle. Overcoming this resistance requires not only clear communication in these assessments but also demonstrating the tangible financial benefits that can result from program optimization.
As hospitals strive to address these challenges, especially in the face of staffing shortages, it becomes necessary to partner with external vendors to fill critical roles in the revenue cycle. Leslie says that partners like UASI can bring much-needed specialized resources to help streamline the revenue cycle and stay up to date in a dynamic environment. These partnerships also enable hospitals to access skilled professionals who can address coding and billing challenges while maintaining compliance.
For new leaders stepping into revenue cycle roles, Leslie offers several key pieces of advice to help set them up for success:
- Review Historical Data: Look back at accounts receivable (AR) and collections trends to establish a benchmark. Most hospitals focus on current performance without comparing it to historical data, which makes it harder to identify trends and areas for improvement.
- Build Strong Relationships: Work closely with hospital executives and make sure that everyone understands the importance of the revenue cycle. As Leslie points out, the revenue cycle is an integral part of a hospital’s financial health and getting buy-in from leadership is essential for driving change.
Revenue cycle management is more than just a financial function, it is a critical component of operational success and therefore, impacts patient care. By addressing issues like coding accuracy, denials management, and staffing shortages, hospitals can unlock significant revenue opportunities and improve their overall financial health. Hospitals that take a comprehensive approach to their revenue cycle will be better positioned to deliver high-quality care while maintaining financial sustainability.
Reach out to learn how a UASI & Vizient partnership can help impact quality outcomes and improve organizational sustainability.