Finance Healthcare

Challenges and Opportunities in Healthcare Finance for Rural Health Organizations

Balancing Finance and Healthcare

Rural healthcare organizations serve their communities as the key point of care for roughly 20 percent of Americans. Due to the location, rural healthcare organizations face significant healthcare accounting challenges that other hospitals and healthcare facilities don’t. For example, the low patient volume means that they have reduced resources and may not be working with a full accounting team.  Rural hospitals are under-equipped for natural disasters and emergent healthcare crises. The month-end closures can be very stressful when there is a surge in patient care.

The finance team can reduce some of these burdens with an enterprise resource solution (ERP). Without changing the patient demand and demographics, ERPs help health care organizations with documentation, billing and managerial paperwork.

Stethoscope and calculator on top of financial documents.

Rural Healthcare Finance Challenges

Low Patient Volume

Rural health organizations serve fewer people and often have a heavy reliance on government payers. Rural health organizations are often collecting from Medicare and Medicaid which can be slower and require more paperwork than the average health insurance provider.

The rural population tends to be older with more chronic conditions which places a higher burden on healthcare finance. The rural health organizations tend to be stretched thin with a population that has a high need for care. While rural healthcare practices have a low patient volume, the patients that they do see tend to have many chronic conditions and need multiple tests and prescriptions. 

Continued Regulations

Changes in the healthcare policies place a regulatory burden on rural healthcare facilities. The Medicare policy and payment changes create significant consequences for rural providers. It creates an administrative and financial burden because the rules fail to consider the circumstances of rural health organizations. 

Rural facilities aren’t able to adapt as easily as those in the suburbs and the cities due to fewer resources. They also have seen shifts from inpatient to outpatient care delivery due to recent policy changes. There is also a growing need for behavioral health care. Electronic health records have also placed a financial strain and a demand for staff training while altering operations. 

Emergent Disasters

Rural healthcare facilities don’t have as many resources to deal with emergent disasters. These unforeseen circumstances that impact the operation of health organizations include natural disasters, epidemics and violence that occurs without warning but requires the immediate attention of a healthcare facility. 

During the COVID-19 crisis, there was a migration away from urban centers which created a greater demand for health care services in rural areas. Currently, one in five people live in rural areas, but as the pandemic persists, we may see even more people flocking to rural areas with remote jobs. This would be a strain on the rural healthcare finance system. 

Physicians and healthcare practitioners are not the only ones overworked during a disaster. The financial team also must work to process a greater number of insurance claims than they are accustomed to processing. They may be overwhelmed with a higher number of patients. 

Month End Finance Closures

There is a lot of stress and anxiety that healthcare accountants face with month-end closing. Since many rural organizations don’t have a full team of accountants to help with month-end closures, the team that they do have must pay close attention to the procedures. Accounting departments may find themselves in non-compliance with laws and regulations based on reporting standards if they aren’t careful. Ensuring compliance begins with good monthly reporting. 

The month-end closing is a financial burden to the healthcare organization, but it must be done to comply with federal regulations and generate reliable reports for investors. The customers don’t see any competitive advantage, but the process is useful for strategic decision-making. For this reason, rural healthcare organizations don’t want to allocate too many resources to the month-end closing process. The faster they can accomplish this task, the better. 

Business leaders would certainly prefer to cut down month-end closing to no more than a couple of days. The average time spent closing books is 6.4 days. By automating the bookkeeping with an ERP, rural health organizations can reduce some of the burdens of month-end closing.

Enterprise Resource Planning Solutions

Many healthcare organizations have adopted ERPs to optimize their daily operations and maximize their potential. Modern healthcare ERP solutions include much more than just management software. They are integral to creating a strategy that allows your health organization to meet its long-term goals. They allow you to centralize the information from your patients and the different departments. When done correctly, you gain insight into the changes that will enhance your operation and keep your stakeholders engaged. 

Multiview Financial produces a powerful and easy-to-use financial application that rural health organizations can use to manage their operations. Multiview Financial offers a scalable ERP and drives results by partnering with clients to automate accounting practices, break down data silos, provide healthcare practices with greater access to information through industry-leading reporting solutions.  

Download our ebook on The Future of Healthcare Finance to learn more about how we can help your health organization. And if you find our ebook helpful, request a demo today to discover how our data-centric financial software combined with a compassionate team that is ready to guide you will benefit your organization. 

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Multiview Financials ERP provides our clients with a comprehensive software suite that empowers their finance teams to advance their organizations.

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