In the past few years, healthcare annual expenses have continued to outpace revenue growth, spurring increased interest in cost containment strategies from hospital leaders across the country. And in 2018, The Advisory Board’s Annual Health Care CEO Survey even found that cost control had jumped to the number one priority for healthcare executives as reimbursement dollars continue to shrink.
During the 2019 Annual Becker’s Hospital Meeting, the Olive team heard leading healthcare executives discuss how rising costs are forcing their organizations to drive greater efficiencies with the same level of resources – all while organizations manage increasing complexity and dwindling reimbursement rates.
So, where can healthcare organizations have the biggest impact on cost containment as they plan for the future?
Today, many traditional cost containment strategies have focused on cutting overhead like human capital, facility, and supply chain costs. But supply and facility costs can only be cut so far, and cutting wages and employee hours is short-sighted, as these strategies contribute to employee burnout and increasing staff turnover rates across the industry.
If hospitals truly want to reduce waste and contain costs, they need to look to the real source of the problem: operational inefficiencies.
Operational Inefficiencies Are The Leading Cause Of Waste
One out of every three dollars spent on healthcare each year is spent on the repetitive, high-volume tasks that make up the administrative side of healthcare. Increasing regulatory requirements are only adding to the burden – an American Hospital Association study found that an average size hospital today dedicates 59 full time employees to regulatory compliance alone, over a quarter of which are clinical staff.
Interacting with health insurance plans is also puts pressure on a hospital’s time and resources – from authorizations, formularies, claims and billing, credentialing, contracting, and data quality review, the process is time-consuming and requires many manual steps that are prone to costly errors. Today, flaws in registration and eligibility processes are cited as the primary cause of insurance claim denials – an analysis found that $262 billion of the estimated $3 trillion in claims were initially denied due to errors, translating to an average hospital risking $4.9 million of lost revenues.
As operational inefficiencies continue to drain valuable resources, it’s easy to see that the never-ending flux of data entry comes at cost – an even bigger cost when you consider the expense of re-work.
At the heart of these process inefficiencies is the lack of interoperability between systems. Data has to be manually pulled and entered from one screen to another, over and over again, making human error inevitable. And with increasingly complex regulatory needs and requirements, an overhaul of the entire system is far-fetched. Hospitals need solutions that work with the systems and processes they already have in place – and this is where organizations have a tremendous opportunity to create financial impact with artificial intelligence.
How Artificial intelligence is Tackling The Problem
Artificial intelligence and robotic process automation have gone from a futuristic buzzwords to real-world solutions providing enormous value at health systems across the country. And while the innovative technologies are being explored for multiple areas, from AI-assisted surgeries to diagnostics, they’re uniquely positioned to solve many of the administrative flaws and headaches that cause so much waste.
Experts anticipate AI for the Healthcare IT market to surpass $1.7 billion by the end of 2019, and through AI and automation, healthcare systems have already begun to reduce expenses and increase revenue recognition. In turn, they’ve been able to take an impact-driven approach to AI implementation, providing both immediate and long-term value to their organizations.
Olive deploys an AI workforce to “shift” these operational inefficiencies from healthcare employees to artificial intelligence as a cost containment strategy. An AI workforce uses operational AI to improve the cost, capacity, and efficiency of administrative business processes by working alongside healthcare employees to handle the large amounts of data and repetitive tasks that are draining the industry of resources and revenue.
Olive saves healthcare organizations time and money by automating some of the most common process bottlenecks like claim status checks, prior authorizations, eligibility verification and more. She has a proven track record of working down massive backlogs of work, allowing organizations to really “catch up” on critical processes, reducing the expense of hiring more (and more) people to handle the work.
Olive is trained to emulate all of the manual steps associates do – only smarter, faster and more accurately – reducing costly errors and increasing operational efficiency. Best of all? Our AI-as-a-Service model means there is one simple subscription price and an all-in-one approach to implementing AI, so hospitals can quickly see a positive ROI
To learn more about Olive and how to hire an AI workforce, schedule a demo with us today.