How RCM Inefficiencies Hurt Patients—and What Hospitals Can Do About It
A patient walks into a hospital for a routine procedure. They checked their insurance, received approval, and expected everything to go smoothly. But behind the scenes, an outdated revenue cycle management (RCM) system failed to verify their coverage correctly.
Weeks later, they receive an unexpected bill for thousands of dollars. Confused and frustrated, they call the billing office only to be transferred between departments that each give different answers.
Meanwhile, hospital staff scramble to correct the error, resubmit the claim, and contest a denial that never should have happened.
Situations like these are not rare and are almost always the result of inefficient revenue cycle management (RCM). But providers that streamline the process improve more than revenue—they also create a desirable healthcare experience for both staff and patients.
Let’s explore the primary RCM inefficiencies that impact patients, and what hospitals can do to rectify them.
How RCM Inefficiencies Hurt Patients
Patients may not understand the ins and outs of revenue cycle management, but they certainly feel the impact when it doesn’t work.
Every mistake or delay in billing, insurance verification, or claims processing directly shapes the patient experience and creates barriers to care that cause stress, confusion, and even delayed treatment.
Confusing Bills Lead to Delayed Payments
No one likes surprises with hospital bills, and patients are no exception. They expect clear, upfront pricing and a simple, transparent breakdown of what they owe.
But when outdated RCM systems fail to provide real-time cost estimates or easy-to-understand billing, confusion takes over. Instead of paying on time, many patients delay payment, dispute the charges, or even avoid follow-up care because they don’t trust the process.
The implications for hospitals are clear. Bill confusion increases collection costs and levels of bad debt and also creates more work for already taxed admin teams.
In a system where affordability is a concern and patients avoid care for fear of incurring debt, unclear billing only exacerbates existing problems.
Insurance Mistakes Create Financial Headaches
Patients also rely on accurate insurance verification to avoid unexpected costs. If an RCM system fails to verify their coverage, they may undergo treatment thinking it’s covered—only to receive a hefty, unexpected bill weeks later.
Denied claims due to outdated or incorrect information put patients in a difficult financial position. Many are left to wade through an appeal process they don’t understand, which only adds to their stress and frustration.
These issues also cost hospitals time and resources they can’t afford to waste. Every denied claim requires staff intervention, resubmission, and a potential appeal. The longer insurance errors persist, the harder it becomes to maintain financial stability.
Administrative Overload Distracts from Patient Care
Doctors, nurses, and frontline staff should be focused on patient care and not be buried beneath mountains of paperwork.
Nevertheless, slow RCM processes distract staff with endless tasks. Physicians alone spend around 15.5 hours per week on paperwork and admin, which is 15.5 hours that isn’t spent on healthcare.
When revenue cycle inefficiencies divert staff from their core responsibilities, it does not go unnoticed by patients. Wait times increase, interactions feel rushed, and the overall experience is unsatisfactory.
A well-optimized RCM system allows staff to spend less time on administrative headaches and more time where it matters.
Delays in Prior Authorization Hold Up Treatment
For patients who require urgent care, the frustrating wait for insurance approvals can also be dangerous. Slow prior authorization delays necessary treatments and procedures, which leaves patients in limbo while providers wait for clearance.
Delays force patients to postpone or forgo critical procedures, which can worsen health outcomes and place extra financial strain on the healthcare system.
The numbers from one physician survey are stark. Some 94% of physicians said prior authorization requirements led to delays in patient care. What’s more, 80% noted that delays caused patients to abandon their treatment and 33% had seen prior authorization problems lead to a serious adverse health event.
Modern RCM solutions streamline authorizations with automation and ensure that delays don’t impact the hospital’s ability to deliver timely, effective care.
Fix the Revenue Cycle. Improve the Patient Experience
When claims process smoothly, bills are clear, and approvals don’t take weeks, patients receive better care and hospitals operate more efficiently.
When revenue cycle inefficiencies pile up, administrative teams are stuck chasing approvals, correcting billing errors, and reworking denied claims. This work then spills over to front-desk staff, care coordinators, and even clinical teams who are forced to take on tasks that were never listed in their job description.
At Radiant Healthcare, we help hospitals and medical groups turn RCM into a strategic advantage. Our latest whitepaper dives into the biggest revenue cycle challenges and offers real solutions to:
Reduce claim denials and speed up reimbursements with automation.
Make billing more transparent so patients understand costs before they receive care.
Free up staff time by eliminating administrative bottlenecks.
Streamline prior authorizations to prevent unnecessary treatment delays.
A more robust RCM process means less frustration, fewer delays, and a better experience for both patients and providers.
Download our latest whitepaper to see how leading hospitals are improving revenue cycles and strengthening patient care.
Want to learn more about RCM that can help (and not hinder) your organization? Connect with me today to discuss how integration, analytics, and AI can take your performance to another level.
References
https://www.forbes.com/sites/adairalandry/2024/03/06/fear-of-medical-debt-drives-patients-to-skip-care/
https://time.com/7094840/abridge/
https://www.acponline.org/advocacy/state-health-policy/toolkit-addressing-the-administrative-burden-of-prior-authorization
