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Is your revenue cycle perpetuating inequity?

By Lauren RobinsonDarby Sullivan

January 13, 2021

    Efforts to advance health equity have historically been pigeonholed in population health or community health departments. But faced with striking data on Covid-19 racial inequities, the health care industry is facing some long overdue reflection. 

    Resource library: Build diversity, equity, and inclusion among your staff and leaders

    One group facing pressure to address inequities is revenue cycle leaders. Last fall, the Healthcare Financial Management Association (HFMA) issued guidance that encourages these leaders to collect patient data stratified by race to evaluate how their operations impact different groups. This is an important push for revenue cycle leaders—but it's just a starting point. Here's how revenue cycle leaders can reduce disparate outcomes and further equity.

    How to design an equitable revenue cycle strategy

    1. Communicate to your teams how revenue cycle practices can exacerbate the social determinants of health in inequitable ways.

    Economic instability is a major social determinant of health. And the rise of high-deductible health plans (HDHPs) has left patients at the mercy of costly medical bills. The most at-risk patients are from marginalized communities that have struggled to build wealth due to a long history of discriminatory practices, such as redlining and predatory lending. For example, Black Americans are 2.6 times more likely to have medical debt than their white counterparts and are more likely to borrow funds to cover medical debt than white Americans, who can often lean on savings.

    2. Track data to ensure you execute revenue cycle practices equitably across all demographic groups, including (and beyond) race.

    To identify disparities, monitor metrics and stratify outcomes by socio-demographic groups to analyze your financial practices with different patient populations. In addition, take an intersectional approach to identify groups most at risk of experiencing inequities. By layering multiple identities (such as race and gender) in your analysis, you can better understand how different types of marginalization and privilege interact to impact billing and collections practices—and be part of the solution. Include the following data points in your data collection:

    • Race
    • Ethnicity
    • Language preference
    • Socioeconomic status
    • Gender identity
    • Sexual orientation
    • Religion
    • Disability status
    • Geography (urban/suburban/rural)
    • Veteran status
    • Highest level of educational attainment
    • Age

    3. Expand and standardize charity care coverage to reduce the economic burden of high-cost care.

    Historically, charity care has been reserved for low-income patients. But in this era of high-deductible health plans, patients are on the hook for a significant portion of their care costs. Even median-income patients struggle to afford health care, increasingly crowdsourcing for health care costs on websites such as GoFundMe. Nearly one-third of GoFundMe requests are currently related to medical care. Health systems must fundamentally shift their approach to financial assistance and charity care to include a ballooning population of patients in need. And as the economy fluctuates, leaders need to regularly revisit and adjust these policies accordingly.

    In addition, revenue cycle leaders must enhance their communication methods to guarantee that staff consistently and adequately educate patients about charity care and financial assistance policies. This is especially important for patients at risk for experiencing health disparities. The IRS requires that charity care must be widely publicized and communicated to patients in plain language, online, on paper, and across the hospital facility. But most hospitals still identify eligible patients and notify them of charity care processes in an ad hoc manner. As a result, many eligible patients miss out on charity care, which can ultimately lead to major financial strain for patients, worse health outcomes, and additional costs for the health system.

    Considering socio-demographic data is new territory for revenue cycle leaders. But those leaders can play an integral role in evaluating how their own practices may contribute to inequities—and how to minimize disparate outcomes. As you look at how revenue cycle processes can influence inequity, follow the lead of patients and community members to build trust and design effective solutions. Patients should have clear avenues to share feedback on their billing and collections experience. And organizations need to ensure that patients feel respected and that their perspectives lead to real action.

    Build diversity, equity, and inclusion among your staff and leaders

    Build diversity, equity, and inclusion among staff and leaders at your organization by building a diverse pipeline and cultivating an inclusive culture.

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