How will the COVID-19 pandemic impact health care revenue and payment systems?
Approximately 80 percent of CFOs and other finance leaders expect COVID-19 to decrease revenue and/or profits this year, according to a new survey from PricewaterhouseCooper (PwC).
Health Care Revenue Impact
Health care providers are experiencing declining patient, case, and visit volume, as a result of COVID-19, which is directly impacting their revenue. According to a JPMorgan Chase & Co. survey featured in The Wall Street Journal, hospital owners are seeing a 40 – 60% decline in revenue. They cannot see patients unless it is an emergency, elective procedures are off the table and physician practices are not running as normal, among many other challenges affecting their bottom line. To avoid risk of exposure, leaders are making decisions to reschedule appointments and nearly shut down physician practices, clinics and outpatient surgery centers. Plus, there is a huge impact with efforts underway to be prepared for COVID-19 patients, which puts additional strain on the health system.
Providers must ensure that they are collecting on every dollar that they are owed to combat the financial impact of COVID-19. These four actions offer business continuity solutions to fill current staffing shortages, transition colleagues to critical roles, and preserve cash and accounts receivables:
- The CARES ACT: The Coronavirus Aid, Relief, and Economic Security (CARES) Act is the largest stimulus bill in U.S. history and provides short term support to alleviate fiscal loss by funding several programs that healthcare providers can take advantage of including:
- A Health Care Fund allocating $100 billion to reimburse for health care related expenses or lost revenues attributable to COVID-19;
- Advanced payment programs for eligible Medicare providers;
- Payroll tax delay for nearly all providers;
- Funding for rural and telehealth opportunities; and
- Paycheck Protection Program (PPP) loan program and loan forgiveness for small hospitals.
- Denials Management: It is essential for the business office to be up to date on coding, billing, and insurance changes daily, as well as understand telehealth waivers, telemedicine, and E-visits – providers cannot afford denied claims due to potential inaccuracies. Even small deficiencies in workflow can create redundancies, errors and rework that cost health care systems millions of dollars in denied or delayed payments. While volumes are down, it’s critical to ensure all claims are processed accurately and timely.
- Colleague Transitions: Educate, cross-train, and repurpose staff to supplement in more critical areas of the revenue cycle. This will prevent backlogs that can drive up accounts receivable (A/R), discharge not final collected (DNFC)/discharged not final billed (DNFB) and cashflow, as well as disrupt other business operations. Some billers, A/R resources, coders, and Clinical Documentation Integrity (CDI) specialists may even be unable to perform their jobs due to transitions, illness, or family leave as a result of the virus.
- Physician Second Level Review: In an effort to keep as many critical care providers as possible fighting COVID-19 on the front lines, physician review could be used to supplement clinical efforts by providing recommendations supported by clinical standards and guidelines. Some physicians who usually perform administrative tasks are experiencing transitions to the front line to take care of patients.
Health care providers must act now to seek resources that will focus on business continuity and recovery plans, so they can continue to serve communities and patients in the future. To all health care providers – thank you for working on the front lines of the COVID-19 Coronavirus fight. We value your service and hope for your health and safety. As you navigate through this pandemic, visit COVID-19 Coronavirus Portal for pertinent information to help you protect revenue and business operations and focus on providing the care our communities need.
nThrive is a member of the Chamber’s Health Care Action Team (HCAT), a unique, cross-functional group of 135+ leaders working to leverage the region’s health care and technology assets and is transforming our 11-county community into the global leader in health care innovation.