Taking a “Moneyball” Approach to Revenue Cycle Management

If you are a baseball fan or have seen the movie Moneyball, the name Bill James probably stirs up a lot of emotion in you—good or bad. For the uninitiated, Bill James wasn’t a player—he was the guy who did statistical analysis in the 1970s in a way that forever changed the way baseball players are evaluated.

Through his analyses, which were first self-published as The Bill James Baseball Abstract, he showed how the quality of a player should be judged not on a few select, individual statistics or whether he “looks like a ballplayer,” but instead the degree to which what that player contributes to the team winning. Not bad for a security guard with no formal analytics training.

There is a lesson to be learned here for the revenue cycle management (RCM) departments in healthcare organizations. As a result of the recent massive move to remote work, RCM managers can no longer rely on walking the floor or stopping by for a chat with individual team members to keep tabs on productivity. Instead, they must now rely more on data and dashboards.

This is good news for frontline RCM workers because it takes some of the subjectivity out of employee evaluations. Yet it also begs an important question: Are managers using the right data to evaluate employee performance? Especially given how the nature of RCM is changing?

Focus on the Business, Not the Activity

When determining how to manage a remote workforce, a typical starting place is to look at the number of hours worked and the numbers of touches each employee generated during those hours. More touches is normally equated with greater productivity, just as runs batted in (RBIs) have always been a measure of a hitter’s productivity (even though that statistic is dependent on the people in front of you getting on base first).

But as robotic process automation (RPA) becomes more established, the goal is to eliminate unnecessary touches on claims that are sure to be approved so billers, coders, and others can focus on the exceptions—the claims with potential problems. This approach, which is much like moving from fee-for-service (activity-focused) to value-based care (outcomes-focused), greatly reduces the number of touches required, making touches a poor measurement of productivity.

Yet that is only a symptom. The real objective for healthcare organizations should be to determine what will help the hospital or health system achieve its business goals, then base productivity measurements on those key performance indicators (KPI).

In other words, hospitals and health systems aren’t in the business of accumulating touches on claims. They are in the business of earning revenue from claims. All KPIs for productivity (and thus workforce excellence) should be based on what will help them get paid faster—and completely. Enhanced workforce performance analytics can help make those and hundreds of other decisions.

When organizations are determining their RCM KPIs, one of the important considerations is to take a top-down approach to determine how each level of the chain affects the ones that follow. For example, if posting revenue the same day it is received affects the ability of the organization to secure secondary revenue quickly, same-day posting should be a performance measure for those individuals to whom it applies.

Another example of a business-driven KPI is the speed with which unidentified payments can be resolved. The longer it takes to determine where a check that is not clearly tied to a specific claim or account should be posted, the more time will be wasted and the worse the organization’s financial position will be. Employees who are faster at resolving these issues have far greater value to the organization than those who must touch an unidentified payment several times before it can be posted, and thus should be rewarded accordingly.

Changing Management Priorities

One of the greatest challenges healthcare organizations currently face is learning how to manage a dispersed RCM workforce. Prior to the pandemic, most followed the “management by wandering around” principle. Managers could see that people were busy and focused in a nonthreatening way, make themselves available to offer advice and build relationships within their departments.

All of that is much more difficult to accomplish when the department is working remotely. To start, different team members may not be working a standard 9-to-5 day. Some may begin earlier, some later, and still others may split their day into segments to meet family obligations, such as helping children with home schooling. If management’s focus is on touches or how many times a button was pushed by noon, the organization could end up losing some very valuable contributors to their business goals. Instead, managers should try to establish a culture of trust between leadership and workers.

Additionally, managers must understand that casually walking by someone’s desk and saying hello feels very different than using technology to monitor how long someone is online and what they do when they’re on. The former feels normal and friendly while the latter feels like spying and should be avoided.

Finally, there is the challenge of helping a team feel like a team when everyone is working in their own bubbles. Knowing how and when to communicate with employees is critical to maintaining that departmental esprit de corps.

All of this requires those evaluating the performance of the RCM workforce to move from being good managers to true leaders. This is another area where workforce performance analytics can help.

The analytics will enable them to move beyond time-based measures to understand who the real producers are in the department so they can reward their top performers and help the others raise their level of productivity. Analytics can also help them understand normal work patterns for the department so they can do things such as schedule an all-department video conference at a time that typically works for everyone. They may even find team members who can help rewrite the department’s best practices due to their ability to deliver better results in a smaller amount of time.

The bottom line is that healthcare organizations can’t just maintain the status quo or wait until things go back to normal because we don’t know when or even if that will ever be. Instead, they must look for ways to work with the current circumstances to improve yield and drive net revenue higher. Especially now when every penny counts.

Healthcare organizations will also help themselves for the future by preparing for a world where working remotely is normal and accepted, especially among high performers. Whether that means permanent remote work or a hybrid status, now that the efficacy of remote work has been proven they must have a strategy for enabling it. Otherwise, they will risk losing their top performers to competitors who do.

For the Win

Bill James changed baseball by using data to show what is truly most important to winning games, divisions, and championships. Healthcare organizations now have the same opportunity.

By taking advantage of workforce performance analytics, they can go beyond traditional assumptions about what constitutes good performance to look at what really drives a healthcare organization’s financial success and modify the way they manage their “players” as a result. It’s a whole new ballgame for everyone in RCM.

Sean Kirby is SVP at VisiQuate, an advanced analytics technology and service company.