Smarter Technologies is a new automation platform developed for hospitals and health systems. It brings together three companies: Revenue Cycle Management (RCM) services business access to healthcare, AI-driven revenue cycle automation platform Infestful.AI, and clinical insights AI business SmarterDX, all of which were acquired by New Mountain Mountain Capital.
Smarter Technologies CEO Jeremy Delinsky, former CTO of Athena Health and founding COO of the True Health, will fireside chat with editor-in-chief Arundati Parmar at Medcity Invest on May 20 in Chicago, and provide an overview of the newly formed business, with the newly formed business and the launch factor.
Can you outline how smarter technology platforms work and why this move has never been seen in the industry before?
First, thank you and Medcity News for taking the time to pay for our release. It was a very exciting day for Smarter Technologies and our newly merged company as we introduced the industry’s first automated and insightful healthcare efficiency platform.
This investment in smart technology represents the largest healthcare platform investment by Johor Bahru Capital to date and ushers in a new technology platform throughout the healthcare revenue management continuum. We are defining a new approach to delivering these types of AI-driven technologies and how provider organizations can leverage services as software. Never done it.
We believe AI is the next great hospital and health system productivity in healthcare. In other words, artificial intelligence alone is not magic. This is not a silver bullet. Enter smarter technology. We are bringing together teams, talent and innovation from SmarterDX, Inspedful.AI and Access Healthcare to harness the power of AI to unlock better revenue cycle outcomes with great disruption, high flexibility and predictability with a huge reduction in costs.
Under a unified brand and leadership team, Smarter Technologies combines a leading, lowest-cost revenue cycle operation and service company (Access Healthcare) with a leading provider of proprietary revenue integrity clinical AI (SMARTERDX), as well as a leading AI-powered business and revenue cycle automation platform (Infactful.ai) – a single platform – Automatically automatic “Auto” ROI, starting from day one.
Unlike traditional models, Smarter Technologies focuses on providing provider organizations and our industry partners with modular solutions derived from EHR-AGNOSTIC and providing them with the leverage they need. Providers do not need to change anything in their current technology environment. They didn’t rewrite anything and didn’t have to use AI tools to train employees. We are offering products that complement hospitals and health systems, so they maintain strategic control and choice from a range of products that can help them address administrative burdens, rising operating costs, rising claims, denials of claims, pressure to improve cash flows, and the need to keep pace with technical and regulatory changes.
In terms of power leveraging AI, providers lag behind payers for 2-5 years. We will change this and we can do it in a relatively short time.
As a comprehensive force, Smarter Technologies brings a unique scale to this challenge, as we now have over 27,000 employees, serving more than 200 clients, more than 60 hospitals and nursing services organizations, supporting more than 500,000 providers, more than 70 RCM and EHR systems and industry partners, we process more than $400 million in transactions each year and have more than $200 billion in revenue-managed transactions.
Providers’ efforts to get paid and operate better are long-term and fundamental challenges. Smarter Technologies hopes to carry a new AI-driven automation platform to support providers. Why is it so difficult?
It’s not an exaggeration to be the biggest disruptor of healthcare payments since automation began 20 years ago. At the time, the technology-enabled payers greatly increased the complexity of claims rulings, as well as rapid acquisitions by other insurance companies. These developments slow down payment cycles and allow providers to fundamentally speed up the ability to process claims, greatly reducing the total number of AR days, the average number of days a company needs to collect cash from customers who use credit to pay. Like all tech races, payers and providers eventually find a balance, with both denial rates and AR days stable. Counterintuitively, all the automation deployed in the mid-2000s did not reduce total revenue cycle costs – it freed up cash for providers to increase spending on executives. Paradoxically, technologies designed to increase efficiency and speed up cash collection also increase overall costs, ultimately passing them on to buyers, including health plans, governments, employers and patients.
For some recent historical observers, the deployment of AI will be a new technological arms race, where health programs invest in first, health systems and hospitals catch up with some level of interference, and finally a new balance emerges. But, assuming today’s AI-LED interrupts will be similar to the changes made by automation, this is a bug, and that’s for some key reasons.
Most of the investments paiders make in AI during the pandemic were deployed during the pandemic, when high-cost utilization was low, relative surprises for health plans, and providers must get a lifetime source from the government to maintain cash flow. While these lifelines do help keep cash higher, providers’ AI capabilities are now far behind payers. Health insurance companies usually lead the deployment of new technologies, but the capability gap is far beyond normal levels.
As a result, payers have more sophisticated tools designed to increase rejection and slow down revenue cycle operations, resulting in a modest increase in provider AR Days – the first in two decades.
In the past, health systems would use direct scripts to respond to new technological capabilities: investing in new technologies to fight payers, hiring more executives to manage claims, and passing prices to buyers over time. But the problem is that buyers have had to absorb massive price increases to explain the unprecedented rise in clinical labor costs of the pandemic (usually increasing to 20 percentage points to the north of 20 percentage points).
The health system has limited leverage, can increase employees, and has little ability to go through steeper prices. In fact, the price increase they are able to achieve (typically 10% to 12%) cannot fully consider the increase in clinical labor costs; they rely on increased utilization to pay for the differences. We believe smarter technologies, along with our new automation and insight platforms, as well as modular products, can help health systems and hospitals face growing administrative and operational challenges. They need a new and flexible revenue cycle management platform that will bring the best human-driven technology, proprietary proxy AI (a form of AI that can make decisions autonomously and perform tasks with minimal human supervision), global operations and strategic insights.
What are the current healthcare industry standards and what are the hospital fees used to collect payments? Industry research points out that hospitals and health systems conservatively spend $40 billion a year, related to billing and collection. How much does smarter technology expectation affect this number?
The healthcare industry standard for hospitals to pay for is usually a percentage of revenue generated. This usually ranges from 4% to 10% of total revenue. This percentage covers all charges related to billing, including technology, staff and overhead. Health systems and hospitals also manage dozens of IT systems. It is crucial to provide them with technology and scale to automate their management workflows as they focus on the core mission of delivering an excellent patient experience. Our goal is to make smarter technology platforms technically and financially a catalyst for excellent healthcare unlocking.
Hospitals are still updating EHRs to promote interoperability and other programs to support interoperability and data security, invest in new medical devices, and more.
Great question. Your observations highlight key structural differences between providers and payers in investing in AI and emerging technologies. This is how this dynamic is because hospitals are capital-intensive organizations with ongoing, non-tax infrastructure costs associated with EHR upgrades to meet interoperability standards, cybersecurity sclerosis to protect patient data, protect patient data, adhere to HIPAA and CMS and CMS rules, and replacement and temporary equipment upgrades. These priorities can shift capital and human resources from experiments such as AI or overhead areas.
On the other hand, payers operate primarily in the digital realm and do not face the same physical infrastructure burden. Their basic business model is data-rich and essentially suitable for AI applications in claim processing, risk prediction and fraud detection. Therefore, they are able to act faster and more aggressively on AI planning.
