Q&A: Solving the net revenue accounting talent crisis

Confidently telling your organization’s net revenue story at month end requires streamlined month-end close processes and data-supported financial insights. But with rising staffing shortages and increasing turnover in net revenue accounting, closing with confidence can become even more difficult than usual. 

In this Q&A article, Ryan Herr, Kodiak’s Vice President of Finance and Reimbursement, describes the current talent shortage, how revenue cycle is affected by high turnover and shortages, and how your organization can overcome workforce challenges and stay confident in your month-end close. 


Q: What is driving the current talent shortage in net revenue accounting? 

A: It’s a two-pronged cause. One is that for the past 10 years or so, there has been an increased focus on data-driven analytics in healthcare revenue cycle and really a desire for analytics that lead to meaningful action. A new wave of leadership in the past five –to seven years, one that has really been brought up around data and analytics, has influenced this increased interest in it. They want to take the vast pool of data they already have within their organizations and create real data-driven insight into what’s happening with their net revenue and determine how they can make it better. Historically, this has not been as much of a focus in net revenue accounting. 


A second prominent cause of the talent shortages in healthcare net revenue accounting today stems from the unique skill set that is required in this space. Today’s healthcare net revenue teams need people who know about finance, accounting, revenue cycle, and managed care, all the components that come together to create a hospital or health system’s revenue stream. In a sense, it can be a bit like finding a unicorn to identify individuals with that precise skill set. When you do, it can be difficult to retain these individuals because other organizations are interested in hiring them away from you. 


Q: What effects do increased staff turnover and talent shortages in net revenue accounting have on revenue cycle departments and month-end close in particular? 

A: Losing staff members who possess a lot of valuable institutional knowledge can have devastating repercussions. Each health system or hospital is different. Everybody’s reimbursement and operational patterns are different. Every organization’s net revenue is just so nuanced. When people who really get your organization’s net revenue leave, that loss of institutional knowledge can create a big void. 


In addition, the effects can further reverberate in that when the person or people with that deep knowledge leave, it might send organizations back to making ill-informed assumptions about what’s driving their net revenue. This misunderstanding often leads to sweeping changes to both the reserve model itself as well as the underlying revenue cycle or finance processes that drive results. Many times, those big changes can cause more pain down the road. 

There also are financial consequences to staffing disruptions. Take a misstep in your reserve model management. It’s not unreasonable to see a mistake from a simple misunderstanding cost an organization millions of dollars. Now of course, with reserves, you can often correct for those mistakes in the next period. But more than the financial impact, mistakes like these erode trust in your reserve model, in your processes, and even in your people. When you use a process that previously was used and trusted, but now is yielding mixed results, organizational leadership can begin to wonder whether they can trust the results and run their business based on those results. 


Q: How can Kodiak help healthcare organizations address workforce challenges like these and maintain confidence in their month-end close? 

A: Kodiak works with our customers to fill gaps in net revenue accounting. We make sure your organization can maintain continuity of month-end close processes and organizational understanding of net revenue, even as you experience turnover. That staffing risk becomes our risk. 


Working with Kodiak and our Kodiak Remote Assistance, our customers can either close gaps in their month-end close processes, have us fully complete their month-end close, or find something customized in between that works for their organization. We provide data-driven support for making a change in your month-end close if changes are necessary, making sure your team’s decisions are based on real data—not assumptions that organizations sometimes turn to in times of turnover and other staffing disruptions. 

Our team works with hundreds of hospitals. We’ve seen it all. In fact, the depth of our experience keeps growing: In the past five years, we’ve seen 45% to 50% of our customer base choose Remote Assistance, up from 15%. Our global perspective can help you glean the most useful insights from your financial data to help you close confidently and set your organization up for long-term success, no matter the workforce challenges facing the industry. 

For more information about Remote Assistance and how Kodiak can help your team overcome workforce challenges in net revenue accounting, contact us today.