Increased costs of running a medical organization — practices, ASCs and hospitals alike — can make a positive bottom line difficult to achieve and sustain. Medicare, Medicaid and many commercial insurances increasingly reimburse far less than the healthcare provider needs to cover its costs and survive.
This last year alone, hundreds of organizations are scaling back operations, merging, or closing facilities altogether. This leads to the loss of convenient access to healthcare services essential to the health of residents, especially in often-underserved rural and even some urban areas. What was typically a short drive to a nearby hospital, specialty practice or, especially, an Emergency Department in a time of need is increasingly becoming an inconvenient one- to three-hour drive that can reduce clinical outcomes — even leading to death — along with increased costs, inconvenience and frustration.
Billing staff shortages come at critical time
As medical organizations do everything they can to stay afloat, one of the critical factors is their ability to keep billing operations running smoothly and efficiently to optimize accurate and timely payments. Unfortunately, the complex and ever-changing nature of billing services is leading to burnout, loss of productivity and even the retirement of hard-to-replace, aging on-site staff. Data shows the magnitude of the challenge. Produced by MGMA, the Medical Group Management Association, the 2023 MGMA DataDive Practice Operations report revealed 33.3% burnout and turnover for business operations support staff — including billing — in 2022 alone. Things aren’t getting better.
One of the many factors impacting this shortage is demographics. Retirements of Baby Boomers hit a record 28.6 million in the third quarter of 2020 alone, with Pew Research showing 3.2 million more boomers retired compared with the previous year’s quarter. Meanwhile, millennials — who now make up nearly 40% of the U.S. workforce — don’t stay at their jobs as long as previous generations did. The U.S. Bureau of Labor Statistics reports the median tenure of workers aged 55 to 64 is 9.9 years. That’s more than three times the tenure of younger workers, ages 25 to 34 years, that’ss just 2.8 years.
Execs cite major AR stress points and impact
It’s no wonder that healthcare executives are stressing out about it. In a 2024 Guidehouse RCM report based on a Healthcare Financial Management Association (HFMA) survey, within the category of “payer challenges” respondents reported these major stress categories: 41% reported denial rates of about 3.1%, with particular pain points including prior authorization, 52%; workforce shortages, 31%; rising cost to collect, 25%; and cybersecurity threats, 24%.
These areas of concern and the underlying staffing challenges have made it much more difficult to attract and retain top-tier employees in an increasingly competitive job market. In fact, a 2022 survey of CFOs and finance VPs revealed that 90% of them reported a labor shortage in their RCM operations, with 50% of RCM roles remaining vacant.
Discussing results from industry studies, MGMA, the Medical Group Management Association, highlights several problems that often negatively impact a provider’s revenue and financial performance:
- Missed opportunities to pursue or follow-up on additional revenue opportunities, such as correcting coding errors, pursuing underpayments, work denials timely, and review key performance indicators (KPI) metrics to drive process-improvement opportunities.
Put simply…a revolving door for an organization’s revenue cycle staff can cause provider organizations to struggle to meet and improve processes and outcomes across the board.
Costs to 200% of annual salary
The direct and indirect costs associated with healthcare billing staff turnover can be substantial, from recruitment and training to decreased productivity, errors and potential client loss. Examples:
- SHRM, the Society for Human Resource Management, estimates turnover costs at 6 to 9 months of an employee’s salary for recruiting and training.
- Some studies suggest it can cost up to 200% of an employee’s annual salary to replace specialized healthcare professionals, according to Oracle.
- A healthcare placement firm cited a study where a 300-employee provider with a 10% to 20% turnover rate could expect to lose more than $2 million annually.
Major turnover cost categories include such areas as:
Direct costs
- Recruitment — Advertising, background checks and pre-employment screening
- Training — Onboarding new employees, covering the cost of training materials, and potentially hiring temporary staff to cover the workload
- Separation — Severance pay, unemployment insurance claims and exit interviews
Indirect costs
- Lost productivity and increased errors — New employees need time to become fully proficient, leading to decreased output (delayed claim submissions) and the potential for billing errors requiring resubmission and causing payment delays.
- Reduced efficiency — High turnover can disrupt workflows and processes, impacting the overall efficiency of the RCM team.
- Lower morale — With extra workloads due to staffing shortages and/or helping train new employees, many staff members face increased stress levels and a lower work-life balance. This contributes to a continuous loop of departures, recruitment, training, billing delays and errors, and other problems that affect continued profitability.
- Patient dissatisfaction — Patients can notice inconsistencies in a healthcare organization’s service quality and experience, including receipt of a bill sometimes many months after a service was provided, often leading to dissatisfaction and a loss of overall service confidence.
- Missed opportunities — A high turnover rate can prevent the RCM team from focusing on process improvements and revenue cycle optimization versus continuous recruiting and onboarding.
Intertwined steps to avoid high RCM turnover and costs
Partnering with a healthcare revenue cycle management services provider such as Advantum Health has been shown to proactively and effectively deal with these retention issues that directly contribute to lower RCM turnover and related costs. Advantum delivers:
- A deep and broad bench of health RCM experts, from billing to coding, credentialing, authorizations, eligibility and auditing. Instead of being a local healthcare provider that’s hard hit by the loss of as little as one key billing staffer, Advantum has an experienced team that’s ready to tackle all or part of a provider’s RCM operations.
- A proven education process, what is known as Advantum University, a series of six-week academies that advance healthcare revenue excellence and foster a sense of inclusion that tracks directly to job retention and satisfaction. With four Provider Enrollment academies to date, 87% of participants have been retained as of this writing; for three Prior Authorization academies, 86%; and 100% retention for the initial RCM Academy class.
- Career development and growth opportunities — Ongoing opportunities for training, growth and advancement keep employees engaged and retained. Research by the American Society for Training and Development (ASTD) shows that companies that foster a strong learning culture have a 57% lower employee turnover rate than those which don’t make this critical investment. A reduced turnover rate translates to substantial savings in recruitment, onboarding and training costs, as well as increased productivity and client satisfaction.
- Competitive salaries and benefits
- A dedication to open communications across all levels of both Advantum and its clients…what we call The Lasagna Method™
- Job satisfaction. Advantum consistently ranks as one of the best places to work in healthcare. Awards as earned by our team’s rankings in recent years alone include:
- 2025 Best Places to Work by Modern Healthcare
- 2025 Best Places to Work in Greater Louisville, KY for fourth consecutive year
- 2025 Best Places to Work by Louisville Business First via a comprehensive third-party survey of top employers
- Certified as a Great Place to Work in India for 2025-26
The solution: Advantum
So as critical billing resources leave or are otherwise insufficient for today’s challenges, an outsourcing partner like Advantum Health offers a proven and consistent track record with its clients. For more information on how Advantum’s experienced team and leading-edge, AI-supported processes can help you, we encourage you to contact us to start the conversation.
