Revenue Cycle Market Heading Toward Sole-Source Landscape

    OREM, UT, November 02, 2011 /24-7PressRelease/ -- The number of healthcare providers replacing their revenue cycle management system (RCM) has risen drastically. Over the next five years, nearly half of the providers KLAS interviewed for the recent study, "Seismic Shift in Revenue Cycle: Market Heading toward Sole-Source Landscape?" told KLAS they plan to replace their RCM, with 87 percent of those planning to do so in the next three years.

There are many factors influencing this shift--from integration and single source solutions to cost and bolt-on functionality--and providers are going about their RCM buying decision processes with more than just the revenue cycle in mind. One CFO of a community hospital on the East Coast said, "I put the decision to find a new hospital-wide system into the hands of my clinical team. I decided that if they were happy, I could make any patient financials package work."

Most providers are looking at a new RCM in terms of how it fits in with a single-source enterprise strategy, often driven by the clinical vendor. Nearly three of four providers in this study mention their CIS as influencing their decision to replace or upgrade their RCM. One in four say that Accountable Care, ICD-10, or other government initiatives were also influences. However, while fewer providers are gravitating toward the best-of-breed approach, this study found that larger development shops and those with a weak RCM are the most likely to choose go-forward plans with a best-of-breed RCM replacement.

Epic and Siemens top the list of considerations for over-200 bed providers while McKesson and MEDITECH were the most considered by community (200 and less bed) hospitals. However, large numbers of considerations are offset in some cases by similarly large numbers of a vendor's existing RCM customers planning to replace them. The chart below shows vendors' overall potential customer wins/losses given providers leaning toward purchasing them and potential customer replacements.

This report also examines how enterprise integration and single-source solutions have increased momentum in the RCM replacement market, the strengths and weaknesses of various RCM solutions, the bolt-on market, and the influence of ACO and government initiatives.

To learn more about the RCM market, the report "Seismic Shift in Revenue Cycle: Best of Breed No Longer the Best Approach?" is available to healthcare providers online for a significant discount. To purchase the report, healthcare providers and vendors can visit www.KLASresearch.com/reports.

KLAS is a research firm specializing in monitoring and reporting the performance of healthcare vendors. KLAS' mission is to improve HIT delivery, by independently measuring vendor performance for the benefit of our healthcare provider partners, consultants, investors, and vendors. Working together with executives from over 4,500 hospitals and over 2,500 clinics, KLAS delivers timely reports, trends, and statistics, which provide a solid overview of vendor performance in the industry. KLAS measures performance of software, professional services, medical equipment, and infrastructure vendors. For more information, go to www.KLASresearch.com, email [email protected], or call 1-800-920-4109 to speak with a KLAS representative. Follow KLAS on Twitter at www.twitter.com/KLASresearch.

# # #