Wednesday, April 8

Payer denials and prior authorization delays are top RCM concerns


Close to 60% of providers who responded to an HFMA survey say they have yet to implement AI or automation in the revenue cycle.

Hospitals are looking to AI automation to streamline revenue cycle processes and to offset payer denials, their biggest issue, according to a survey by the Healthcare Financial Management Association (HFMA), analyzed by AI-led services firm Guidehouse. 

Seventy-eight percent of providers who responded are using automation and AI to speed up manual revenue cycle processes.

Their biggest cited issue is payer denial of claims. Eighty-eight percent said disagreements over claims are preventing their organizations from getting paid. Three quarters, or 74%, reported an increase in prior authorization delays.

Twenty percent reported denials of over 5% of claims, compared to 12% in a previous survey. 

Other factors impacting the accounts receivable of hospital executives and physician groups are unclear denial rationales, excessive documentation requests and reduced reimbursement rates. 

Because of this, executives are looking to strengthen their relationships with payers, according to the 2026 Revenue Cycle Management Trends.

While the 2026 Healthcare AI Trends survey found that three out of four executives are currently implementing or have used AI in various functions, use of AI and automation may not be as common in the revenue cycle: 59% of respondents said they haven’t yet implemented AI or automation in the revenue cycle; 42% are exploring it; and 16% haven’t considered it.

Just 2% said they’ve fully or mostly integrated these technologies across their RCM operations.

Sixty percent of executives said they haven’t yet implemented any AI or automation in their revenue cycle operations. Thirty-nine percent said they’re implementing point solutions.

Respondents also say their teams are struggling to contend with slow front-end operations, workforce shortages, compliance hurdles and technology challenges.

Because of workforce shortages and seeking external expertise, over half of providers (66%) are outsourcing all or part of their revenue cycle to a managed services vendor, according to the survey. 

“As AI continues to mature, providers will benefit from access to intelligent revenue cycle platforms that power and scale their operations. But these technologies still need sound governance and human oversight,” said Andrew Hancock, Guidehouse Partner and Payer/Provider Financial Solutions Leader. “Our findings reinforce the need for health system leaders to invest in payer strategy and contract management to find common ground with health plans and reduce friction that slows reimbursement.”

 

 

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