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Forum Insider | CRCOs Work the Revenue Cycle

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Payer strain and payment delays are never a good thing, yet they seem to be the growing norm for health systems. At THMA’s Chief Revenue Cycle Officer Forum, health system leaders collaborated to navigate repeated denials and manage payer relationships. Through this roundtable, leaders talked through common frustrations and offered solutions to the complex world of revenue cycle payments.

The roundtable of chief revenue officers revealed mounting strain between health systems and payers, centering on complex appeals, DRG downgrades, and administrative gridlock. Systems reported escalating use of legal teams and vendors like R1 to contest complex appeals, particularly with BCBS, describing the process as “building a lawsuit.” Arbitration delays and payer staffing shortages have made appeal resolutions drag for months or even years. To compound these delays, DRG downgrades have climbed 300% over 18 months.

Leaders expressed deep frustration with payer interactions, calling discussions “Groundhog Day” cycles with no real progress. Denial rates remain high (around 12% initial, 2% final), and even strong appeal success offers no leverage. Participants also discussed tracking interest on delayed payments, burdensome medical record (252) requirements, and the struggle to monitor line-item denials effectively.

Key Takeaways:

  • Explore Case Rate Contracting but Anticipate Payer Pushback: Case rate models can help prevent DRG downgrades and ED level denials, but payers may pivot to line-item denials and medical necessity reviews. Include protective contract language and tracking mechanisms.

  • Strengthen Contract Language: Define downgrade, appeal, and interest payment terms explicitly to avoid ambiguity. Several systems found success preventing downgrades through contractual clauses.

  • Improve Denial and Interest Tracking: Invest in tools or vendors (e.g., Swift RCN) to track delayed payments and interest owed. Many organizations lack reliable visibility into payer behavior at this level.

  • Escalate Strategically and Build Relationships: Escalate disputes beyond provider reps to leadership when needed, while maintaining regular payer engagement to identify root causes of recurring issues.

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