How COVID-19 Will Affect Rural Hospitals’ Revenue Cycle Management

The ongoing COVID-19 pandemic has been a drag on the bottom lines of many rural hospitals, despite the fact that the disease has yet to fully infiltrate many rural areas. One of the reasons for this is the sharp decline in patient volumes. At least 15 rural hospitals have closed their doors so far in 2020, with many citing declines in patient volumes as a reason.

“Patient volume numbers have dropped across the board for rural hospitals, even in areas where there are not a lot of COVID-19 cases,” says Derek Morkel, CEO of HealthTechS3 and GAFFEY Healthcare, which provides revenue cycle automation technology and services to healthcare providers. “There’s an overriding theme of general uncertainty that is impacting everything.”

Despite the uncertainty, Morkel offered three predictions regarding revenue cycle management as it relates to rural hospitals:

The “telehealth revolution” will not save rural hospitals.

In light of the ongoing stresses of COVID-19, the adoption of telehealth services has been fast-tracked, as the Trump administration and the U.S. Department of Health and Human Services approved in March 2020 the use of telehealth services as part of the Coronavirus Preparedness and Response Supplemental Appropriations (CARES) Act.

Rural hospitals have been able to join the “telehealth revolution” as well, since one of the perks of telehealth is the ease with which patient revenue from telehealth services can be captured and collected.

“Hospitals have had to figure out the different billing codes and collection practices for telehealth services,” Morkel says. “But other than that, the process of submitting a bill to the insurer and getting paid for it doesn’t change. And since telehealth doesn’t pay out large amounts of money, the insurers don’t play around too much with reimbursement.”

That said, telehealth is unlikely to shore up the loss of revenue that rural care providers face in the midst of the pandemic. While monitor-to-monitor doctor visits are appropriate for mental health counseling, Morkel maintains that many physical healthcare services—dermatology, for instance—can only be provided via face-to-face consults. For this reason, the popularity of telehealth will likely plateau as providers figure out what it can and can’t do.

Rural hospitals will outsource more of their financial services.

Morkel says the current demand for new revenue cycle software is not as robust as it could be, as many hospitals have punted on such purchasing decisions in this time of uncertainty. However, with so many hospital employees working from home, a push to outsource patient revenue processing may follow.

“One thing that will come out of this is smaller hospitals will be more willing to outsource when it comes to revenue cycle management,” he says. “Adoption of the kinds of technologies that allow hospitals to get their billing done cheaper and faster will increase.”

Morkel adds that many hospital CFOs will be looking for technology that provides a host of revenue cycle management services, rather than just one unique service.

“There’s a clear trend of CFOs wanting to deal with fewer vendors,” he says. “Those offering the tools to cover a spectrum of revenue cycle automation services will be more likely to win a deal.”

A “second wave” will affect rural populations, but it may not involve actual COVID-19 cases.

Rural areas missed the initial coronavirus threat, due to their removal from airports and high-traffic highways, but many experts have in recent months predicted that a “second wave” could wallop rural hospitals in the second half of 2020.

However, among rural populations—which typically skew older and show higher incidents of heart disease, cancer and chronic lower respiratory disease—those who are currently letting their health issues go unchecked because of concerns about hospital safety could wind up flooding ERs once the worst of the pandemic is over.

“When people look back, five years from now, they might refer to the second wave as a spike in other areas like cardiac cases and cancer cases, as people are not currently going to hospitals and physicians for the care they need,” Morkel says. “I’ve seen ER visits that are down 40 to 50 percent at some hospitals. Where are those people getting their care?”

Morkel reiterates the problem of uncertainty that has come with the pandemic, saying rural hospitals have it particularly tough because of the lack of availability of talent in many areas, relative to urban centers. After all, rural areas are not only short on available doctors and nurses, they’re also short on administrative professionals who can handle the complexities of revenue cycle management.

“I think the talent gap is one of the toughest things in revenue cycle management as it relates to rural hospitals,” he says. “If you’ve ever worked with an insurance company, or even just tried to read a hospital bill, you know the billing and collecting of receivables is incredibly difficult. It involves some fairly technical activities. Make a mistake and you could be losing out on a $30,000 or $40,000 bill.”

Need help with your revenue cycle operations in the time of COVID-19? Please contact Jennifer LeMieux, Chief Operating Officer, at