ECU Health increases margin, reduces costs through revenue cycle alignment

Challenge

ECU Health is a mission-driven, 1708-bed academic health care system serving more than 1.4 million people in 29 eastern North Carolina counties. The not-for-profit system is comprised of more than 14,000 team members, nine hospitals and a physician group that encompasses over 1,100 academic and community providers practicing in over 185 primary and specialty clinics located in more than 110 locations. The flagship ECU Health Medical Center, a Level I Trauma Center, and ECU Health Maynard Children's Hospital serve as the primary teaching hospitals for the Brody School of Medicine at East Carolina University. ECU Health and the Brody School of Medicine share a combined academic mission to improve the health and well-being of eastern North Carolina through patient care, education and research.

As part of their financial transformation strategy, ECU Health identified a multi-year trend of increases in accounts receivable (A/R) days and A/R aging percentages, as well as decreases in net collections yield. Leaders knew they needed to transform their revenue cycle approach to improve performance. As a result, ECU Health initiated a transformational project, which included an engagement with Guidehouse. The goals included:

•  Develop a culture that values:
  • Psychological safety through the celebration of problems and transparency, along with empowerment;
  • Team development; and
  • A transition from a constraints mindset to a growth and winning mindset.

• Rebuilding the revenue cycle as an integrated component of operations across the system through investments in people, process, and technology.
• Generating better organizational alignment with areas impacting revenue cycle.   
• Enhancing transparency with key performance indicators and other potential performance opportunities.  
• Creating targeted workstreams.
• Leveraging technology to accelerate and sustain improvements.   
• Achieving long-term financial viability.

Approach

The cross-discipline initiative began with an in-depth assessment of ECU Health’s revenue cycle and managed care functions. With assistance from Guidehouse, leadership assembled a comprehensive plan to improve performance through:

• Creating needed business cases prioritized by impact and workstream development to support these work efforts.
• Developing more efficient project management and return on investment tracking processes.
• Addressing individual workstream needs, including revenue integrity, denials, managed care, self-pay improvements, strategic pricing, and reduction in A/R days and uncompensated care.
• The development and implementation of new policies, procedures, and training to sustain improvements.

An integrated approach

ECU Health leaned on Guidehouse to support throughput improvements in A/R, clinical appeals, and interim management. Their engagement with both Guidehouse’s Advisory and Managed Services teams enhanced strategic oversight and operational execution. The organizations worked together to realign revenue cycle structure with a future state vision that included staffing analysis, job description development, and recruiting and onboarding of new revenue cycle leadership to sustain long-term improvements.

The focus included:

• Avoidable write-offs: Task forces conducted root cause analysis on key trends like authorization procurement, medical necessity, and credentialing.
• Charge capture: Establishing ownership at the clinical level and integrating training with revenue integrity efforts helped revamp the charge reconciliation program and identify opportunities to minimize missing charges.
• Point of service (POS) collections - patient balance education: An overhaul of the POS program boosted prepayment collections by providing patient estimates and implementing a patient loan program. The addition of a financial assistance vendor significantly increased patient advocacy screenings by 1,000% leading to an improved patient experience.
  
  

Overall, the multifaceted approach ensured that ECU Health was successful in building a new culture to not only optimize revenue cycle processes, but to also achieve measurable sustainable improvements across key areas of their financial operations.

Impact

Eighteen months after the project begun, ECU Health realized a total income statement improvement of more than $93.1 million from improvements in uncompensated care, avoidable write-offs, and hospital charge capture. Cumulative cash acceleration reached almost $113.6 million and is projected to rise further with the reduction of A/R days by 14.3 days.

Notably, ECU Health achieved these results while maintaining or improving patient outcomes. ECU Health Medical Center has been nationally recognized as an award-winning health system for three consecutive years according to PEP Health’s 2025 rankings.

Other significant improvements included:

• A/R management/cash acceleration 
  • Accelerated $103.4M in hospital cash and $10.2M in physician cash.
• Avoidable write-offs
  • Reduced hospital avoidable write-off rate by 50% and professional avoidable write-off rate by 29%.
• Uncompensated Care
  • Reduced bad debt by 19%.