The Future of Revenue Cycle Management

How health systems can integrate new technologies and maximize ROI

Modern revenue cycle management (RCM) technologies help streamline operations and improve efficiencies, so this report uses language everyone can understand, sharing trends and best practices rooted in proven methodologies.

The Future of Revenue Cycle Management presents a vision for what a digitally integrated RCM future could look like and is intended to help guide conversations with executive teams. For a deeper dive, reach out to BRG to schedule a private client briefing with your executive team.

Executive Summary

US hospitals and health systems find themselves at a crossroads. Organizations are under extraordinary pressure to reduce costs: from 2021 to 2023 alone, labor costs skyrocketed by over $40 billion and inflation far outpaced Medicare reimbursement growth, resulting in a growing financial gap that is outpacing payer reimbursement. Facing these financial headwinds, providers continue to make necessary technology investments to optimize revenue collection.

This has made effective revenue cycle management (RCM)—the process by which providers bill, track, and collect payments—invaluable. But optimizing RCM is not easy. Ongoing payer barriers, workforce shortages, operational roadblocks, and regulatory changes make it difficult to know how best to proceed and where to invest. One recent report found that the majority of healthcare organizations surveyed say their revenue cycles have not improved since 2019—and just 3 percent assess their revenue cycle as “market leading.”

New technologies can help. Wider adoption of artificial intelligence (AI), for example, could generate $200 to $360 billion annual savings sectorwide. In addition to reduced costs, leveraging technology in RCM can help employees work at the top of their licenses, improve the patient experience, streamline operations, and drive increased productivity, among other benefits.

Getting there, however, takes thoughtful RCM strategies, investments, and counsel. Health systems and hospitals have an increasing number of technology solutions to choose from. However, upfront costs can be a barrier and integrating new systems adds complexity, making return on investment (ROI) difficult to quantify or guarantee. Expanding the use of technologies brings new data security and privacy risks, as evidenced by the recent cyberattack on Change Healthcare.

In this paper, we take a deep dive into the pressures facing today’s hospitals and health systems. Drawing on BRG’s expertise, experience, research, and insights from industry leaders, we offer actionable next steps and leading practices to help organizations modernize their RCM programs. Ultimately, we present a vision for what a digitally integrated RCM future could look like for providers.

As Mike Vigo, chief revenue officer at UC San Diego Health, puts it:

The future of RCM is a lot like the track relays we saw at the Paris Olympics. The runners are the various technologies doing the majority of the work—be it via electronic medical records, RPA, or AI—and the baton handoff is the human touch that provides the quality assurance these processes need to run smoothly.