5 Essential Elements of Revenue Cycle Management (RCM) Success: Innovation (Part 1 of 4)

A successful RCM partnership depends on results across a variety of key metrics. You’ll know if your relationship is effective if your RCM partner has helped your organization:

• Increase cash flow
• Accelerate the speed of reimbursement
• Reduce denials
• Lower your cost to collect
• Maximize workflow automation
• Achieve higher appeal success rates
• Integrate complementary tools and services
• Recognize and adapt to payor policy and behavior changes
• Facilitate interoperability with related technology and systems

Even if you’re experiencing improvements in these areas with your existing RCM vendor, how do you know if you can do even better with a different partner? When evaluating the potential for further improvements with a new RCM partner, how do you compare them against your current relationship with concrete data? And if you’re selecting an RCM partner for the first time, where do you start?

Whether evaluating a current RCM outsourcing partner or assessing new potential partners, you need a comprehensive, quantitative view of their capabilities. Industry reports and surveys offer valuable, objective insight. Black Book Research, for example, provides excellent resources for evaluating RCM outsourced service providers and their performance.

Each year, Black Book Research conducts an in-depth study on how diagnostic leaders evaluate outsourced RCM service providers across 18 key performance metrics. The 2024 report includes participation from 3,114 individuals representing 2,787 provider organizations.

Those performance metrics directly inform the five essential elements of RCM success:

1. Innovation
2. Expertise
3. Reliability
4. Security, Compliance, and Trustworthiness
5. Quality of Service and Value

Understanding these five categories—and applying them to objectively evaluate the strengths and weaknesses of your current RCM outsourced services provider—can help you determine where you have gaps or are failing to maximize the effectiveness of your RCM processes and practices. In the remainder of this first of four articles, we’ll examine the innovation category.

Defining Innovation

Innovation is a critical competency for healthcare technology and service providers. Payor policies and responses constantly change or are ambiguous, patient expectations evolve, and new tests or services are added to your menu. Regulations change, and technologies advance. There’s a lot to keep up with.

Innovation requires a partner that thinks creatively and sees beyond the current state and into future possibilities. You want a partner who can grow and adapt with you and bring its innovative drive to position your organization for continued, long-term success.

Evaluating Innovation

Objectively assessing innovation can be tricky, especially if you’re evaluating a new potential partner with whom you have no prior relationship. Here are two examples of how Black Book Research evaluates innovation through its Diagnostic/Laboratory/ Ancillary Services Revenue Cycle Management report.

For one performance metric, “Innovation and Optimization” (question 2, table 6, page 14), Black Book Research asked study participants to evaluate whether RCM customers believed “their vendors’ technology is helping them manage business and care more effectively, generate accurate records and reimbursement billings and cut their overhead in ways that were difficult or impossible to accomplish before RCM solutions were implemented.” Related to this same performance metric, Black Book Research also asked survey participants to evaluate their vendor’s responsiveness to requests to “push the envelope to further enhancements,” and address recommendations with game-changing improvements. For this performance metric, XiFin ranked first with an average score of 9.78—15% higher than the average of the other nine vendors evaluated in this category and higher than XiFin’s 9.55 average score for this metric in the 2023 Black Book study.

For each performance metric, each vendor’s performance scores are categorized by segment: Hospital Laboratories, Pathology Practices, Clinical Laboratories, and Toxicology and Public Health Laboratories. For the “Innovation and Optimization” performance metric, XiFin ranked first in each segment, as well as first in the radiology and diagnostic imaging segment (as shown in table 23,page 31), and scored an impressive 9.89 among pathology practices surveyed. Averages are also calculated and presented.

In a second innovation-related performance metric, “Best of Breed Technology and Process Improvement” (question 18, table 22, page 30), Black Book Research asked survey responders to evaluate outsourced RCM services providers on the following attributes:

• Vendor solutions and related services are considered best of breed.
• The vendor technology elevates customers via capabilities, equipment, processes, deliverables, technology, professional staff, leadership, quality assurance, and innovative initiatives.
• Vendor services are delivered at or above current/former in-house service levels.
• Technology is current and relevant to exchanging health information among providers and sufficiently offering patient access and interoperability.

For this performance metric, XiFin ranked first with an average score of 9.74, higher than our average score of 9.44 in the 2023 Black Book study. Hospital laboratory survey respondents rated XiFin 9.93 for this “Best of Breed Technology and Process Improvement” metric.

Innovation is a cornerstone of healthcare organizations’ financial sustainability. An innovative RCM partner can mean the difference between growth and stagnation, profitability and breaking even.

Our next article in this series focuses on the second essential element of RCM success, expertise. Meanwhile, download the full 2024 Black Book Market Research “Diagnostic/Laboratory/ Ancillary Services Revenue Cycle Management” report to see which outsourced RCM service partners can help you accelerate cash collection and increase profitability.

You can read part 2, 3 and 4 of the series below: