5 Big Challenges Medical Practices Can Expect in a Slumping Economy
Healthcare practice owners and managers are reviewing their budgets and projections amid signs of emerging financial challenges they expect to endure during a slumping economy. Medical organizations that have been taking their billing software and services for granted will be paying closer attention to changes they can make to maintain their bottom line.
You may be on the fence about outsourcing your billing or revenue cycle management, but the state of the economy is prompting you and your associates to look at these options to help you deal with ongoing medical practice challenges.
Major Challenges in 2023 for Medical Practices
There is a great deal of economic fallout from the disruptions caused by the COVID-19 pandemic. In all sectors, businesses are still picking up the pieces, and healthcare organizations are no exception. The main issues to contend with include staffing, inflation, and technical issues such as cybersecurity.
Read on for an overview of the present medical practice challenges and why medical groups are transitioning from doing billing in-house to letting experts focus on these tasks for them.
1. Staffing Issues Are Among the Biggest Medical Practice Challenges
Did you lose members of your team because they were unable to come to work in person during the global coronavirus pandemic and the social distancing mandates? Or, like other medical practices, are you finding it a challenge to recruit or maintain new talented members for your staff?
Staffing issues remain a major issue for medical organizations. As noted by a recent report from Medical Economics, the number of open jobs in healthcare reached 9.2% as of September 2022, citing the latest statistics available from Fitch Ratings.
Some doctors’ groups will develop ties with local educational institutions to help steer more talented medical graduates their way. Other practices will determine that it’s more practical to work with hiring firms to help deal with the labor shortfall.
According to Deloitte, there are only about 3.1 million registered nurses working in the United States today, but the industry will require approximately 1.2 million more nurses by 2030 since so many baby boomers are going to be reaching the age where they need more healthcare services.
When you lack sufficient staff with the experience to properly take care of billing, it could be a sign that it’s time to outsource revenue cycle management to experts. Do not put off improving the flow of revenue just because of challenges in finding sufficient staff to hire in your local community.
2. Cybersecurity Fears
If your practice has not been affected by the recent outbreak of cybercrime, you can count yourself among the lucky ones.
Hopefully, you have beefed up security to avoid attacks by these online criminals, who use malware such as ransomware to hold a practice’s patient and financial data hostage. They don’t release the records until the owner pays a ransom in untraceable Bitcoin.
Practices that are not ready for hacker attacks need to stop what they’re doing and immediately consult with IT security professionals if none are currently on their staff, to shore up their network.
Not only would a malware attack pose a major blow to your finances, but it could also cause patients to sue you for failing to safeguard their data. You also risk patients leaving you for another doctor out of concerns over privacy. In the aftermath of a ransomware attack, you may find it extremely challenging to find new patients willing to come to you for treatment.
After cybercriminals attack your practice, you might find it more challenging to recruit new talent, if employees think you are not able to keep the systems they rely on to do their jobs as secure as possible.
3. Planning for Ongoing Inflationary Woes
Of course, a major challenge for your practice will continue to be inflation. About 76% of respondents to a survey of health system professionals indicates that inflation would cause a significant impact on their companies, as noted by reporting from Deloitte.
Almost a third of consumers cited inflation as their top reason for being concerned about covering unexpected healthcare costs. Patients who have been hit especially hard by economic downturns are putting off routine visits to their doctor, as well as for tests and follow-ups.
And increased expenses affect the profitability of medical practices too, especially with ongoing shortages and other issues caused by supply chain breakdowns.
Razor-thin margins are another financial challenge that could be the downfall of healthcare organizations. Hospital margins were running at a negative in November 2022, with just -0.2 percent, according to a report from Revcycle Intelligence. For smaller local facilities, the margins could be so disastrous that they either shut down or find themselves acquired by larger entities.
4. Engaging With Patients to Help Maintain Retention Levels
Are you seeing patients leaving your practice, and aren’t quite sure why? Now might be a good time to conduct a survey, to see how satisfied or dissatisfied your patient population is with the services you provide. Perhaps your staff needs to practice better bedside manners, to make patients feel more at ease. Or, patients feel rushed because of your financial pressures to get more out of each appointment.
In such cases, you might need to work more efficiently in other areas, so you can give more time to patient care. This could include investing in modern software and computer system, as older machines and outdated applications can hamper your productivity.
Since in excess of 70 million people report being unprepared to pay for the costs of their healthcare, per a Revcycle Intelligence inflation report, it’s all the more crucial that you make them feel comfortable and that they sense they’re getting services worth paying for.
Boosting patient engagement is easier when you meet them where they are. You’ll want to go online with your practice’s social media channels, to communicate interesting facts to help keep patients healthier, and to encourage them to exercise or make better nutritional choices.
You can also activate a patient portal connected to your electronic health care records software, to allow patients to communicate more easily with staff, which saves everyone time and effort.
Some practices find it beneficial to create a newsletter that they send out to patients by email once a quarter or on a monthly basis. This is an easy service you can offer to help boost engagement, for those who want to sign up to receive it, that is!
5. Preparing Staff to Switch Focus to Value-Based Care
You already have plenty on your plate, dealing with staffing shortages, inflationary pressures, and the rising costs of goods in a poorly maintained international supply chain. Owners and managers of medical practices are making value-based care a priority now to help keep their lights on and retain their loyal patients.
With a value-based care mandate, you can anticipate seeing a rise in new patients as well as more patients staying with you rather than leaving. You cannot overstate the positive financial effect this stabilizing effort will bring to your business.
Focusing on value-based care will force your staff to learn new ways to document information and to make sure you are complying with the government’s push to promote better outcomes for each patient.
There are issues of making sure you collect the right data to document value-based care, for example, and in using computer systems that are interoperable with those used by insurers and the government.
Chances are good that you will have to make some changes to your workflow processes, which is already challenging enough when you are short on team members due to labor shortages in the local community.
Outsourcing Revenue Cycle Management
With so many financial challenges for your medical practice, you will likely take a multi-pronged approach to securing your bottom line. You can see that practices are devoting more resources toward meeting value-based care standards to help them stay competitive.
But it may be tricky to do this when you are also trying to find suitable recruits to stay on your team.
You also have to figure out what you’ll do as a hedge against inflationary pressures. Under such circumstances, it often makes sense to outsource revenue cycle management tasks to third-party professionals.
Consider that a business handling RCM on an outsourcing basis will be spending all of its time on this important process, leaving your team free to focus on healthcare delivery.
The RCM business will be motivated to keep its systems up and running 24/7/365, since their reputation will be on the line.
Their information technology professionals will keep the software updated and patched for bugs and security problems as soon as possible, which is one less burden for your own office team to contend with.
And since these are RCM specialists, you can rest assured they will follow industry best practices and will be aware of upcoming changes from the government. They will address everything from privacy protections to meeting the requirements to demonstrate you are providing the requisite level of value-based care in your practice.
Safeguarding Your Future in the Face of Ongoing Medical Practice Challenges
Owners and managers of healthcare organizations realize that now is the time to put more effort into addressing the significant medical practice challenges we’re facing all across the country.
Indeed, many medical practices are starting to take a hard look at their finances to see how they might best ride out the current economic uncertainty. A major example is the need to make changes in how they handle medical billing. One approach is to outsource RCM processes to third-party experts that devote all their time and attention to the details of revenue cycle management.
To help you and fellow stakeholders prepare to switch to transferring these tasks from under your roof to professionals in revenue cycle management, download this ebook, “From In-House To Outsourced RCM: Everything You Need To Know” today, free of charge. And keep reading this blog to stay abreast of updates in the healthcare industry.
- A range of significant challenges pose problems for the bottom line of your medical practice in 2023, that you’ll want to prepare for now.
- Staffing will be a major issue for large and small medical practices this year, amid the “Great Resignation” and lower unemployment rates.
- Protecting your organization against cybersecurity attacks can be a major challenge, but it’s necessary to have adequate security to keep your network from being compromised, and data held hostage.
- Ongoing inflation poses another challenge, from keeping patients away due to lack of funds to pay for visits, to your own issues with high prices because of supply chain woes.
- Your staff may be unaccustomed to engaging with patients, but meeting this challenge can help boost patient retention and recruitment.
- Shifting to a value-based care approach is a significant challenge for healthcare organizations, such as making sure your computer systems are interoperable with others and that your staff is up to speed on producing the necessary documentation.
- For many medical practices, it makes sense to outsource revenue cycle management services to external, third-party professionals, to improve their bottom line amid so much economic uncertainty.
Medical Economics: What challenges can medical practices and facilities expect in 2023?
Deloitte: 2023 Outlook for Health Care: Could margins/staffing stall progress to the Future of Health?
Revcycle Intelligence: Financial Challenges for Health Systems Will Likely Persist in 2023
Revcycle Intelligence: Inflation Driving Financial Challenges for Consumers, Health Systems
Ebook From In-House To Outsourced RCM: Everything You Need To Know
About Gene Spirito, MBA
Gene has been involved in sales and deploying well over 1,000 revenue cycle management and billing solutions for medical practices, groups, networks, and laboratories of every specialty. With more than 25 years’ experience, Gene has guided so many ADS clients toward the configuration that would work best for them such as services through MedicsRCM, or in-house automation with the MedicsCloud Suite. Gene has an undergraduate from Villanova University, and an MBA from Temple University. Not surprisingly, Gene’s an avid Wildcats fan (the VU basketball team).