Medical Billing & Revenue Cycle Management (RCM) Companies that offer successful EMR implementation at the practice level are transforming the outsourced, third-party Medical Billing Service industry.
Powerful trends within the RCM Services Industry are fueling both its growth and at the same time driving the consolidation of a highly unstable and fragmented market, but the focus is centered upon a small handful of Revenue Cycle Management Services that offer EHR software such as AthenaHealth who now reports serving over 50,000 providers, or 20% of the total out-sourced medical billing market.
Although unprecedented growth for the RCM industry may be on the horizon fueled by Stage II Meaningful Use and the redacted ICD-10 initiative, a new trend of market consolidation is being driven by a highly uncharacteristic commoditization of RCM Services led by players like Athena who recently announced that due to the sophistication of its technology, it’s able to offer RCM services profitably at 2.9 percent of collected revenues – far less than doctors can accomplish themselves –or for that matter, other billing services.
For the first time, in an industry where relationship and facetime have traditionally prevailed, it is difficult to see how doctors will resist the allurement of such cost savings when it’s offered in tandem with a guaranteed successful EHR implementation that almost instantly puts them in compliance with such daunting Medicare/Medicaid mandates as ICD-10 or Meaningful Use; and given the rate at which the trend is taking hold (Athena is growing at 27%), one may ask how traditional billing services with no end-to-end EHR solution to offer physicians will fare in the ensuing shakeout.
As almost 50% of the EHR market is currently owned by more than 400 different regional EMR providers, it stands to reason that the handful of larger companies who possess the right combination of EHR technology and RCM expertise will emerge with the lion’s share of this shifting landscape; for instance eClinicalWorks an EMR company that offers RCM services at 3.9% of collected revenue, are certainly positioned to benefit.
Other large EMR providers have begun offering RCM services as well, including GE Healthcare, McKesson, and AllScripts –all 800lb gorillas in their own right. In fact it appears that every cloud-based EMR software vendor has jumped onto the “Athena” bandwagon of offering RCM services along with a free EMR. Practice Management Software provider Kareo, which in the past offered only web-based medical billing software announced earlier this year the release of a free EMR with RCM services to physicians, two entirely new product lines for the company.
One software vendor however is putting control back into the hands of Medical Billing Services by making “Athena-like” RCM software available to the physician billing industry. Silicon Valley based Revenue Cycle Management and EHR software provider PracticeSuite.com has aligned itself as a friend to the RCM industry; and given the climate, Medical Billing Services intending to compete against the forces suddenly arrayed against them may need just such a technology partner on their side if they hope to remain a viable outsourced billing solution in the years to follow.
Physician perception is driving change too.
The increased complexity and pressure of regulatory compliance from Meaningful Use, ever shrinking reimbursements from Medicare and Medicaid, and steady advances in technology are creating a difference in how practitioners perceive the future of their businesses. As physician’s need-perception change, technology and specialization are playing an increasing role in addressing those changes; from mobile apps, to cloud computing, physicians are being forced into a brave new era of becoming technically savvy and thinking more like a business.
Today’s physicians require anywhere, anytime access to patient data; Meaningful-Use compliant clinical software; and they are aware that fist-time insurance claim pass rates of over 90% are achievable essentially through technology. They are also desperately in need of a predictable transition to ICD-10. The conclusion? Medical billing companies you still see standing tomorrow are the services that understand and are meeting these changing needs today.
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Last Updated on February 16, 2021