Business Solutions: Balancing the Financial and Human Side of Outsourcing RCM
Download MP3Well, hi, everyone. I'm Daniel Williams, senior editor at MGMA and host of the MGMA Podcast Network. Today, we're gonna be looking at the topic of out sourcing revenue cycle management. And to help us walk through that and unpack that topic are two experts from Greenway Health. Today, we've got Chuck Rackley, vice president of sales and revenue operations, and Marvin Luz, senior director of revenue consulting.
Daniel Williams:First of all, Chuck, Marvin, welcome to the show.
Marvin Luz:Thank you for having us. Happy
Chuck Rackley:to be here, man. Thank you.
Daniel Williams:Yeah. It's great having you here as well. So first of all, let's just take a step back before we get deep into that topic and just learn a little bit about each of you. I don't know who wants to kick off first, but I'll turn it over to you guys and just share a little bit of your background into health care and what else you might wanna share about your career trajectory.
Chuck Rackley:Sure. I'll go first, Marvin, if that's okay. Let's have the better better guy for for a second. So, my my career is split pretty much down the middle. I have I have a little bit of experience in both sides of the coin.
Chuck Rackley:So I've started the career on the provider side. I worked for a very large hospital network called HCA. I'm sure everyone's heard of that one. And eventually matriculated over to the dark side of the force, and I joined the the vendor partner side around 02/2014. I had a lot of different roles, everything from operations, FP and A, advisory, implementation, and eventually into sales and sales leadership and on into the executive roles.
Chuck Rackley:So had a lot of different time all in revenue cycle, but ended up in the place I'm supposed to be here at Greenway with my good friend Marvin. Go ahead, Marvin.
Marvin Luz:Sure. So I've been in the industry about twenty four years. The first four years or so was actually working at a private practice and then joining organizations like Greenway for the past about fourteen years dealing specifically with revenue cycle management, both from an operational perspective, advisory perspective. And, now I get the privilege of leading our our consultant team here at Greenway.
Daniel Williams:Alright. Chuck, let's turn back to you then. Give us, first of all, just a high level overview of what RCM outsourcing looks like today.
Chuck Rackley:Yeah. It's a good question to start with, Daniel, because it's really changed in in in our experience over the last several years. At a high level, you know, RCM today looks a lot different than it did even just a few years ago. It's no longer just about, you know, just sending out claims to a partner, hoping someone else handles it. What we're seeing now is a much more strategic partnership that's expanding very, very rapidly.
Chuck Rackley:So we're outsourcing partners are leveraging, you know, not just the normal technology, but they're really taking a step forward in the marketplace, leveraging AI analytics. And really the most important thing is specialized expertise and scale. That's really going to drive that both the financial and the operational performance that people are looking for. You know, for practices specifically, that means moving away from that burden of staffing, training, managing an internal billing team, especially when that the turnover is so high these days and just keeping people on staff. Add that to the regulatory environment that's constantly changing.
Chuck Rackley:Instead of that, with a partner, they're able to tap into that scalable team that can go up and down depending on what volumes are, whether you add a doc here or lose a doc here. Very much more efficient, more accurate. And most of the time, these partners are better equipped to handle that everyday rigmarole of authorization eligibility all the way through denial management and bad debt. So it's a much different marketplace than it was even a few years ago. As for the why behind that trend, it's pretty simple.
Chuck Rackley:So practices are are really under more pressure than ever from both regulatory and, more importantly, the payers. Reimbursements tighten every single year. We see a new trend every year on what denials look like. It gets harder to keep people on staff. You have Hobby Lobby or McDonald's coming to to pillage your your staff every single year, it seems like, for a couple dollars more.
Daniel Williams:Mhmm.
Chuck Rackley:And when when you have the right RCM outsourcing partner, when done right, it can help practices stay financially healthy without sacrificing that clinical focus. And that that's where Marvin and I really try to make the difference.
Daniel Williams:Okay. Marvin, let's turn to you then. Let's look at it through the lens of the patient's financial experience and satisfaction. So when you look at it through that lens, what does that mean to do that outsourcing, that partnership, really with the the patient, the customer in mind?
Marvin Luz:Yeah. This is a topic I'm very passionate about, Daniel. So, one of the things that drives patient dissatisfaction, in my opinion, is patient statements. They can be confusing, inaccurate, and not timely. This trifecta not only erodes at a patient satisfaction level, but also it contributes to potential revenue leakage for a practice.
Marvin Luz:Look. With more and more patients having high deductible plans, more and more of the financial responsibility is falling on patients. It's imperative that patient statements are accurate, timely, and easy to understand. When partnering with a revenue cycle management organization, I would recommend fully understanding their patient financial experience. What are their workflows and processes?
Marvin Luz:And what is their philosophy on interacting with your patients? At the end of the day, we're all patients. Put yourself in their shoes and review things from their lens. One of the things that I'm most proud of with Greenway Revenue Services is how our people treat patients with empathy and understanding. This goes a long way for for patient satisfaction.
Daniel Williams:Yeah. Marvin, I love that you said that to put ourselves in the patient's shoes because we're all patients at one time or another. So to be able to empathize with that, to be able to see it through their eyes, because we're all patients as well, then we get a better understanding of what that would look like. So thank you for sharing that. Chuck, I'll move to you then.
Daniel Williams:When we talk about, outsourcing, you gotta do your due diligence. So what are the steps, a provider should take in really studying those options out there and what are the steps they should make too so they can make the best decision possible?
Chuck Rackley:Yeah. Awesome question. Marvin and I see this all the time where people make a very reactive choice to start this process. It's usually done in haste because something has happened. There's someone they've lost or there's some, you know, very critical factor that's happened.
Chuck Rackley:But one thing people usually skip as administrators is sitting down with their their leadership and understanding what the specific internal challenges are and what the goals are, more importantly, what they wanna get out of that partnership. So is are they trying to get down their denial rates? Do they have slow collections? Do they have staffing issues?
Marvin Luz:Are are
Chuck Rackley:you just want more predictive predictability? So there there's lots of things that people complain about, but it's rare that people get real focused on what they specifically wanna get out of a partnership. So the next thing is they really need to start evaluating on four major things that that Marvin and I really focus on when working with new practices. The four things are expertise of the of the partner. So and this goes beyond, you know, do do you have the ability to collect money?
Chuck Rackley:This goes into specialty specific. So there there are so many specialties out there that really require an in-depth knowledge and experience. So things like anesthesia and, you know, neurosurgery are not the same things as pediatrics and family practice. So just because one one vendor does incredibly well with one means zero for how they will do with the other. And it's really important to match that expertise with what your practice is looking for.
Chuck Rackley:The second thing is on transparency. The thing you wanna avoid here is if if you're in a vendor situation where they're just sending you a bunch of reports and they've got these these decks at the end of the month that are 70 pages long, and you and you're yawning
Daniel Williams:Yeah.
Chuck Rackley:Halfway through. Like, that's where you not want you don't wanna be there. So someone's just reporting the news back to you, that's where people go that's where the deals go to die. So you want someone that's really giving insights to your business and that's really moving you forward. The third is is on technology.
Chuck Rackley:And you can lump a lot of things in here, your AI, your machine learning, the general technology they have for follow-up and submission. All those things need almost I evaluate those on a a completely separate basis on how they're doing that. And the fourth thing, and I specifically put this fourth because I a lot of people go here first, It's on price and ROI. So a lot of people will make this decision just on price. And I can't tell you how many times Marvin and I have lost a deal because of price, and they go to someone else.
Chuck Rackley:And, uh-oh, it didn't work. And now we're down worse than we were before, and they come back to us. So that happens all the time. So you have a lot of these and and forgive me for saying, but the regional mom and pop players that really try to just buy business a lot of times, and they end up hurting the practices more than than they needed to get into. So it is important, but it's important to marry price with what the ROI is out of that.
Chuck Rackley:So price is one component, but make sure you're not missing the forest for the trees. That's the biggest thing.
Daniel Williams:Alright. Thank you for that. Marvin, one other aspect to look at when you're looking at outsourcing that RCM component is the compliance side of it. So what are some of the indicators that a provider should be looking at, from a compliance side? And perhaps if you wanna share what, Greenway is doing in that regard as well.
Marvin Luz:Yeah. Sure. So ensuring that billing stays aligned with, you know, payer requirements, and and regulatory requirements is a full time job for a team. Right? So at Greenway, not only does this responsibility, lie with our business excellence team, but everyone at Greenway is focused on ensuring that we stay aligned with payers and regulatory requirements.
Marvin Luz:Our team uses several different resources, right, from payer notifications and bulletins to reviewing payer websites and portals and manuals. So once we've identified any changes that are needed, we then create what we call our standard operating procedures. Once we have those standard operating procedures, then we provide that training to the appropriate team that's affected. Then once everyone is trained, we follow-up with quality assurance procedures to ensure adherence to that as well. Right?
Marvin Luz:So we have five easy steps. One, identify the change. Two, determine the relevance and the impact. Three, document the action that's needed to address that change. And then four, train the appropriate team members.
Marvin Luz:And then finally, following it up with quality checks, again, ensuring compliance to those changes.
Daniel Williams:Chuck, I wanna come back to you. Now let's assume that you've done all your due diligence as a provider. You have found your outsourcing partner for your RCM. It's in place. Now you gotta measure it.
Daniel Williams:You gotta make sure that things are working. What are those KPIs? What are you measuring? What are you looking at to make sure that relationship is working?
Chuck Rackley:The best way to think about this in our experience has been think about the path of cash along the way. So what is stopping this from being paid and being paid as fast as possible? So, a, let's start with the end of the path. What is the cash? So a lot of places really struggle with putting a number on what should I have been paid.
Chuck Rackley:What is the amount of cash I should get every month? And there are a myriad of cash collection goals or formulas out there. There's there's lots of them. There's the GCR rates people use. Some people use NCR, so net collection rate versus gross collection rate.
Chuck Rackley:I've seen people do a price to charge ratio goal. Some some more sophisticated practices have a contract management system where they're actually able to determine the allowable on every single claim. That'll be the most accurate, but not a lot of practices can't afford that kind of system. But having some sort of goal that you measure yourself against and measure, more importantly, your partner against is the first thing that I always look at. I look at it every single day as an operator.
Chuck Rackley:What is happening from a cash perspective? Am I on track? Am I below track? Am I ahead? Etcetera.
Chuck Rackley:Second part of that, you go back to the beginning. What is stopping my claims from going out the door, and how are they being adjudicated? So the best one to look at there is clean claim rate. What is going through the door without anyone touching it and being adjudicated first time at bat? So, obviously, you wanna be as as high as possible there.
Chuck Rackley:The best practices we have are around that 95% rate, some a little higher, some a little lower, but you wanna be up there. Third one would be some sort of AR measure. So whether that be days in AR or aging over 90 or one twenty or whatever it is, that but to have some sort of AR measure so where you can make sure your balance sheet is in check and and ensure that you have proper cash collection metrics going on there. Last but not least here is denial rate. So you wanna measure your initial denial rate that you're getting from the payers.
Chuck Rackley:So this is that first adjudication back. You're seeing what was denied and measuring against both your dollar and your count of your gross charges. So a really, really good practice is gonna come in there around seven to 8% of an initial denial rate. We've seen some as low as two and three, and we've seen some as high as 25 or 30. But what's more important there is how you look at that denial rate to ascertain what's causing them so you can really get down to the root cause.
Chuck Rackley:Other than that, so if you measure that that path to cash, so your clean claim rate, something in AR, so be it days or or aging, your denial rate, and ultimately, what cash did you get versus what you should have gotten. That's where you need to be measuring.
Daniel Williams:Thank you for that. Let's come back to you, Marvin. You're really focused on building those relationships, with those providers. When they're looking at outsourcing their RCM, what are some of the misconceptions you're seeing that they may have about those outsourcing partners, and how do you overcome those?
Marvin Luz:It's a great question. Because I I feel like one of the most frequent misconceptions that I know Chuck and I encounter is that practices will lose visibility and control, and especially around quality and accountability. Now can that happen? Sure. Absolutely.
Marvin Luz:But that's where it's critical to partner with the right type of revenue cycle vendor. Now at Greenway, we do all of our work within our client system. The client system remains the source of truth for our clients. Right? Documentation on the actions we're taking provide visibility and transparency to our clients.
Marvin Luz:At any time, clients can view the work and actions our team members have taken on the work. Having quality reporting like Chuck mentioned earlier, that provides insight into financial health of our clients, helps provide the visibility and control that practices need in order to run a successful practice. Now having a partner that sits down with leaders of a practice to understand the practice's short term and long term goals, that also ensures accountability is part of the partnership of your revenue cycle management organization.
Daniel Williams:Alright. Couple of questions I'd like to ask y'all before we sign off today. I wanna come back to you, Chuck, and I feel like it would be a disservice to be talking about RCM in 2025 without talking about the impact technology has on it. I mean, I think in every conversation we have, there's automation, there's AI, there's machine learning. So let's really talk about that, Chuck.
Daniel Williams:When we look through that lens of technology and transforming outsourced RCM, how technology can play a role there. Talk about that.
Chuck Rackley:Yeah. For sure. And this is such a great point because we spend, I would say, 75 to 80% of our time internally working on what is the next thing we can bring to this market. And all of it has to do with automation and AI. It's completely reshaping how we think about RCM at Greenway and how the overall market is really going after this.
Chuck Rackley:So traditionally, RCM has been that manual labor intensive process. Just think about all the hours we used to spend checking eligibility one at a time, you know, checking claim status one at a time or even appeals for the most part now. So with automation in AI, we're able to take a lot of that repetitive work and and dump that to a bot or some sort of agent as it were. So traditionally like, for example, bots can now verify insurance eligibility in seconds. You have manual interfaces with all sorts of payers.
Chuck Rackley:They can flag missing information before claims are submitted and even post payments automatically. That's happening. That's been around. But what really separates what's been there versus what's going up forward is when we get into that agentic AI, that's really taken into the next level, which is really cool to be around right now because now we're starting to see AI agents actually making calls to insurance companies. We're seeing AI agents take scheduling from patients.
Chuck Rackley:We're seeing automatic language language processors really look at what a denial is and figure out what what to pull from the medical record in order to submit an appeal. And even some on the authorization side too, which has been kind of the the the the holy grail for a long time. How do we automate authorizations? And AI even steps takes that a step further. So it's not just about speed.
Chuck Rackley:It's about what intelligence it can bring back to you too. So AI tools can analyze patterns that, you know, even professionals like myself and Marvin won't see. They can predict what claims are gonna be at risk and recommend that proactive proactive step to get there even before a human even sees it. So there's a lot of stuff that we can do now that was the moon to us even a year ago. For our providers, most importantly, that translates into that higher clean claim rate that we talked about Mhmm.
Chuck Rackley:Faster payments, reduced price, reduced spend, and reduced time that they spend looking at this so they can actually go focus on their patients. So in short, technology is gonna is gonna continue to transform RCM right now. It's a really exciting time to be in the in the in the market. I probably say that every year because something else cool has come along. But now now this is really, really neat, what we're seeing.
Chuck Rackley:And I think it's gonna be a big, big change that we see going forward in the marketplace for sure. You're gonna have better control, more visibility, and better financial results, and with less workload. That's that's that's where I see it.
Daniel Williams:Alright. Thank you for that. I have one last question. So, Marvin, I'll turn to you. We had a November MGMA stat poll.
Daniel Williams:Our our listeners will know about those MGMA stat polls. This one, I wanna get this right, it found that 36% of medical groups will outsource or automate at least part of their revenue cycle in 2025. So what's your advice for practice leaders who are still hesitant about outsourcing?
Marvin Luz:I'm gonna try to recap what what we've talked about today because I think there have been some some great pieces of information today. So I I would say first, understand what your objectives are as an organization. That's critical to your success. Secondly, understand where your practice is in its financial health journey. Right?
Marvin Luz:Mhmm. Third, vet your potential partner to ensure that your goals, your values, and your objectives are aligned with that partner. Fourth, I would say partner with a vendor who's an expert in your system and understands how to utilize its functionality to the fullest. Fifth, have biweekly, weekly, monthly meetings with your vendor to understand challenges and utilize that time to calibrate on any upcoming goals or changes in your practice. And finally, and I think Chuck will agree with this one wholeheartedly, is communicate, communicate, communicate.
Marvin Luz:That's the key to a successful partnership with your revenue cycle vendor.
Daniel Williams:Alright. Well, Marvin
Chuck Rackley:Daniel, can I add one more?
Daniel Williams:Please. Oh, please do. Please do.
Chuck Rackley:And and this is one that we find very, very helpful. Don't ever be afraid to ask to talk to other people. So if if you're if you're nervous about how to partner with someone, ask for a reference that you can actually get in there and and see what's their responsiveness. You know, what's their reporting like? What's their performance been?
Chuck Rackley:And even the ones that so Marvin and I use a lot of references for different things, but it's not all beautiful even with the references that we choose.
Daniel Williams:Yeah.
Chuck Rackley:So don't be afraid to ask for that. It would be my last little bit of advice here. And that goes for when you're picking a provider and especially for the people that are a little nervous about outsourcing. Talk to other people that have done it and see how it went.
Daniel Williams:Alright. Well, Chuck, Marvin, thank you so much for joining us today.
Chuck Rackley:Our pleasure.
Marvin Luz:Thank you for having us.
Daniel Williams:Alright, everybody. That is gonna do it for this episode of the MGMA Business Solutions Podcast. We have been joined today by Chuck Rackley and Marvin Luz from Greenway Health. They've been sharing their expertise and giving us a deeper look at the benefits, challenges, and future of outsourcing your revenue cycle. So until then, I just wanna let everybody know we are gonna put direct links in the episode show notes so you can click through to some of these, practices and processes that Marvin and Chuck have been talking about.
Daniel Williams:So I just wanna thank everybody listening for being MGMA podcast listeners.
