July 31, 2019

Don’t Be the Blockbuster of Revenue Cycle

Buried deep in Netflix’s seemingly unending invasion into our daily lives, there’s a dangerous myth.

Most people think we ended up trading Friday nights roaming the aisles of Blockbuster for scrolling through queues on the couch because of Netflix’s business savvy and timing. The truth, though, is that Blockbuster beat itself.

If you don’t know the story, Netflix co-founders Marc Randolph and Reed Hastings originally approached Blockbuster with an offer to sell Netflix for just $50 million. Blockbuster declined, deciding to stick with their late-fee-based revenue model. Today, Netflix boasts more than 130 million customers, and Blockbuster has just one store left.

On the healthcare front, too many providers are taking Blockbuster’s position even in the face of a changing revenue cycle, and that amounts to a huge risk.

Digital Transformation or Bust

Revenue cycle change is always a massive undertaking. New technologies, switching vendors, and disrupted workflows are uncomfortable, but in the era of digital transformation, they’re also an opportunity. Yesterday’s patient is today’s patient-consumer, and they’re making decisions about their healthcare similarly to the way they choose their entertainment options.

Leaders who embrace this shift have an opportunity to use revenue cycle services (like sophisticated outbound communication and automated appointment reminders) to gain a competitive advantage.

This is the future of the patient financial experience, and the majority of revenue cycle leaders agree. According to a Black Book Research survey, 80 percent of health system CFOs believe that staying competitive will mean engaging in digital transformation.

It’s All About the Growth

For a long time, revenue cycle management was a game of cost-cutting, but the winds seem to be shifting.

The Advisory Board’s Annual Health Care CEO survey revealed that more executives are focused on revenue growth as their single priority — beating out population health, cost containment, physician network alignment, and ACO strategy.

This doesn’t mean that costs don’t matter, but it is a clear signal that healthcare leaders are moving toward a more proactive posture. Staying competitive will require an approach that works to understand patients through a focus on workflows that increase revenue while simultaneously decreasing costs.

Netflix Issues a Warning to Healthcare

For many leaders, this new perspective that embraces change is going to require a different approach to risk — something for which Netflix’s Randolph is actively encouraging healthcare to develop a tolerance.

At last year’s Healthcare Analytics Summit in Salt Lake City, Randolph urged healthcare to have confidence and optimism. “It was not about having good ideas…It was about a system and a culture of trying lots of bad ones. What we realized is that the key to this is not the good idea. It was how quickly and easily and cheaply you could try as many ideas as you could think of.”

The stakes in healthcare are higher, and it’s hard to overestimate the cost of a bad idea, but forward-thinking revenue cycle leaders can still take a few lessons away from the Blockbuster-Netflix story. That starts with embracing a vision of a future revenue cycle that makes you look back at today’s outcomes and communications strategies and say, “Wow, what a difference.”

RevSpring Can Help

Integrated payment communication is part of RevSpring’s DNA. We tailor the payment conversation to influence behavior and inspire action. Our segmentation rules and workflows help you become hyper-focused on the patient, understanding their ability to pay, and mapping their financial obligations to repayment pathways.

If you’d like to learn more about our comprehensive patient engagement and billing solutions, we’d love to help you. Request a demo to see how we can help your organization meet its goals.