Forecasting healthcare net revenue is like using a magic eight-ball: you're not getting clear or trustworthy results.
To start the revenue forecasting journey, we'll dive into calculating gross and net revenue. Gross healthcare revenue is arbitrary; it's based on billed charges, but are you forecasting payment timing from insurance payers and patients? Sometimes gross healthcare revenue overstates "real" revenue by two or three times over. Calculating net healthcare revenue is simple, at least in theory. Take your billed charges and subtract both contractual and adjudicated adjustments and you'll find your net revenue. The tough part is that this equation is usually based on static aggregations of inconsistent historical data and does not reflect new contractual rates or terms. Often, it takes denials and underpayments at face value instead of how they are truly impacting your business.
Most healthcare organizations don't have a real-time revenue forecasting solution, and the ones that do don't have the time to devote to truly keeping the logic current. And that's assuming you have actual copies of your contracts that you thoroughly understand and monitor and keep an up-to-date historical analysis of adjudicated claims.
But in order to forecast efficiently, you'll need precise, repeatable, and fine-tuned measurements that improve revenue performance. The median health system cash reserve fell 28% in the last year, which can be directly linked to poor healthcare revenue forecasting. Precise forecasting solves for this problem and ensures solvency, liquidity, and on-time payroll.
But how can we accurately forecast healthcare net revenue in the coming year? In our recent webinar, "Wrangling Net Revenue Forecasting" our panel of healthcare finance experts offered their expert advice for calculating healthcare net revenue.
Rivet’s financial and revenue cycle operations platform has helped healthcare providers across the country effectively manage the financial demands of today’s challenging healthcare landscape - from handling compliant estimates, accelerating upfront payments, delivering price transparency, managing payer performance, and everything in between.
Learn more about how Rivet can accelerate your revenue.