Legacy A/R Wind-Down: Smoothing the Transition to a New RCM or HIS Solution


When transitioning to a new RCM or HIS system, addressing legacy A/R is at the top of your list of concerns. Use our timeline to streamline planning and execution.

Develop a timeline, assess your resources, and tackle legacy A/R aggressively

Whitepaper | Giliane Poole
Executive Director of Revenue Management

Giliane leads service delivery for patient liability and revenue management at Change Healthcare. She has extensive RCM knowledge and experience managing hospital and physician revenue cycle functions.

Tackling A/R Wind-down

Whether you’re upgrading your current revenue cycle management (RCM) solution or introducing a new one that’s part of a larger health information system (HIS), the transition can be bumpy, especially if you haven’t planned for how to handle A/R inventory while you migrate from one system to another. Without proper planning, you may see significant cash-flow disruptions and unnecessary write-offs, not to mention increased staff frustration as confusion mounts and delays occur.

There are many moving parts associated with A/R wind-down projects, and it can help to view the various activities across a timeline to clearly identify when certain tasks should start, continue, and complete.

Best Practice Recommendations

12 Months Prior to Go-Live: Health System Planning

To lay the foundation for a seamless RCM/HIS system transition, it is critical to kick off an A/R wind-down project at least a year in advance.

Things to do during this phase:

First and foremost, you need to define project goals. A crucial step in this process is to ask what exactly is changing. Are you switching to a whole new RCM system or just implementing some key elements? What are the potential impacts of these changes on your A/R? What do you hope to accomplish and by when?

Along with the abovementioned tactical questions, you should also consider whether you will seize this opportunity to revamp underperforming collection processes. Migrating to a new system or undergoing a significant upgrade offers a prime opportunity to examine current processes to see where they have become unproductive — and to identify changes that will create the most impactful improvements.

Although you may already know areas that could be more productive (e.g., self-pay collections, payer interactions and processing, and payment posting/ reconciliation), it may be beneficial to have a neutral third party evaluate existing systems to spot possible improvements you may have missed.

Deciding on a project lead is also important at this time. This person or group of people will own the A/R wind-down project and be responsible for moving it forward. Depending on your organization and the project’s size and scope, the lead may be a single individual, such as a revenue cycle director, or a task force made up of key stakeholders, including A/R management staff.

After project goals and leadership are set, you should assess the current state of your A/R. This allows you to understand where your revenue is being held up and where you may not have the resources to address any backlogs. For example, if you’re seeing high levels of aged A/R, especially A/R >365 days, an assessment could point to the need for additional resources to get the outstanding revenue in check prior to transitioning to a new system. While it may seem a little early for this review, if you have a relatively consistent census, your A/R aging balance mix will most likely remain consistent over time. By assessing the mix well in advance, you can start planning early on how to address it.

Questions to ask during the assessment include:

  • What is the anticipated volume of aged A/R that must be collected prior to go-live?
  • What is the collectability of aged A/R?
  • What will it cost to properly collect all aged A/R?
  • Is it worth spending resources to collect the aged A/R? Or is it better to write it off?
  • What are archival and storage options of legacy A/R data and records?
  • Will existing staff be able to manage working in both the old and new systems?
  • Will you need to supplement with outside resources?

To accurately answer these questions, be sure to involve all stakeholders in the assessment, including revenue cycle staff tasked with A/R management. Asking about further concerns upfront can also help anticipate possible roadblocks.

During this time, it will become evident whether your organization has the experience and resources to handle the planning and project design on its own or whether you need a partner. There are some risks with going solo for A/R wind-down project design. Details matter in the planning process, and for this kind of initiative, there are a lot of details. If you don’t allocate resources sufficiently or your schedule is overly ambitious, you could be setting yourself up for problems, especially if there are critical tasks at risk of being overlooked. That’s why it can be beneficial to bring in an outside expert to help create a transition plan, review an existing plan, and/or supplement a plan with additional resources.

8-10 Months Prior to Go-Live: Define the Scope of Work

After the assessment is complete, you will be able to define a scope of work more clearly. This will then launch other key activities that will enrich the planning process even further.

Things to do during this phase:

Now is the time to figure out the resources you need to address legacy A/R and whether you have the right number and type of staff available to handle the work. Note these resources are different from those used to plan the project. At this point, you want to figure out whether you have enough A/R professionals at your disposal to simultaneously manage A/R wind-down and tackle accounts in the new system. The more you can precisely quantify what it will take to address legacy A/R, the more you can plan for, budget for, and allocate the necessary resources—even if it means bringing in an outside entity.

To get a sense of resource requirements, conduct time studies to quantify how long it takes to resolve different A/R scenarios. These studies will help you understand the lift involved in cleaning up A/R. You may also want to conduct a risk assessment to understand the timeframe in which you must have the inventory resolved as the timing will also affect the number of resources needed.

Once you have a clear idea of what’s required, you can flesh out a reasonable timeline and communicate with all stakeholders, so everyone is on the same page.

It’s also important to set a realistic project budget and agree on where to prioritize funds. As part of this effort, be sure to engage in contingency planning and coverage for any ‘drift’ or delay in a scheduled transition. If you think you’re going to work with an external partner, it’s helpful to weave in some flexibility there as well, so you can be confident you’ll have the support you need when you need it.

To get a sense of resource requirements, conduct time studies to quantify how long it takes to resolve different A/R scenarios. These studies will help you understand the lift involved in cleaning up A/R.

6-8 Months Prior to Go-Live: Vendor Contracts in Place

If you have decided to work with an outside vendor, it is wise to bring them into the project early.

Things to do during this phase:

Any contracts should be signed and ready as soon as possible to allow the two organizations to start working together and iron out any communication and collaboration hurdles. Implementation timelines should be clear and agreed upon, so everyone has the same expectations around cadence and deadlines.

You should also determine what criteria will be used to measure the success of the partnership. For example, you can set an expectation to reduce 25% of the outstanding A/R by a certain date or reduce credit balances by 50% in the first 60 days. Whatever metrics you choose should be quantitative, realistic, and mutually acceptable, so that everyone is clear and comfortable with how they will be measured.

After establishing metrics, take baseline measurements of average A/R days, A/R >90 days, and other key data points, so you can tell whether performance is changing during the run up to or at go-live, and in the immediate aftermath of the transition.

4-5 Months Prior to Go-Live: System Access in Place

At this point, you should make sure your plan is ready for the transition, that your outside vendor has access to the legacy system, and that work on winding down the A/R has begun.

Things to do during this phase:

Although you completed an initial A/R analysis before the project officially launched, it is helpful to do another one toward the end of this period to see if anything has changed and whether your initial assumptions are still valid. This will show you whether the A/R can be resolved as expected, or if the timeline needs to be adjusted due to unanticipated delays. This evaluation will also reveal whether your inventory is similar to your initial assessment and confirm there are no large swings that would change resource needs.

By cleaning up old patient accounts in all financial classes and actively addressing legacy A/R for collections and adjustments, you can drive the legacy A/R to a “clean” state before the RCM/HIS transition. This will save both money and time once your new solution goes live.

3 Months Prior to Go-Live: Legacy A/R Cleanup Launch

This is the time when your vendor or legacy-focused internal team is zeroing in on problem areas, including A/R >365, rebills, credit balances, aging clean-up, and so on.

Things to do during this phase:

By cleaning up old patient accounts in all financial classes and actively addressing old A/R for collections and adjustments, you can drive the legacy A/R to a “clean” state before the RCM/HIS transition. This will save both money and time once your new solution goes live.

As part of this effort, determine which accounts are worth pursuing and which should be written-off. Although your internal team may prioritize highbalance accounts, don’t overlook the benefits of low balance ones as well. It may make sense to tap outside resources for these since vendors can mitigate write-off risk and save critical dollars if such accounts are handled in volume.

Researching and resolving aged, outstanding credit balances that may be outside of regulatory resolution timeframes can also be a logical task for outside resources. Processing credits is arduous and will not yield income, but it may avert penalties for non-resolution.

Large-scale cleanup transactions should be documented to create a paper trail in the event that an account needs to be re-examined. Also, be sure to capture detail associated with any and all write-off projects.


The most stressful part of an RCM/HIS transition is often the actual switchover, because until you disable the old system and start running the new one, you cannot be certain if everything will work exactly as planned.

Things to do during this phase:

By this time, your legacy A/R should be significantly less, and your internal team’s focus should shift to monitoring metrics that could indicate issues with the new system. Note that it is normal to see an initial increase in A/R days, but you should return to pre-implementation levels relatively quickly. Your team should remain flexible to handle unexpected situations and be ready to provide feedback for rapid resolution. To that end, it is wise to let your vendor or legacy A/R team continue to resolve old A/R, leaving current staff to work solely in the new system.

Things to Look for in a Potential Partner

Choosing the right vendor can make the complex, time-consuming A/R wind-down process smoother, more reliable, and less costly. But not all vendors are up to the task.

When seeking a potential partner, be sure to look for one that will provide expert guidance while still letting your team spearhead the work. The company should have staff who can work independently but also as part of a team, and these individuals should have deep knowledge and expertise, as well as a commitment to collaboration. When the partner has a flexible resource pool, it can more easily accommodate shifting needs, especially if it can direct resources to the many manual elements of the process.

Other characteristics to seek include:

  • In-depth knowledge of the transition process and all its various nuances, challenges, and requirements
  • Intelligence into how specific elements of the hospital’s structure, culture, and leadership could affect the transition
  • Sophisticated analytics to enhance planning and measurement
  • Proficiency in payer rules, including Medicare, Medicaid (including Medi-Cal), Workers’ Comp, Tri-Care, and motor vehicle accident (MVA) insurers
  • Familiarity with the nuances of diverse reimbursement models, including multi-facility health systems, community hospitals, critical access hospitals, and Federally Qualified Health Centers (FQHCs)
  • A strong commitment to using performance-based criteria to demonstrate success

Winding down A/R during a large-scale RCM/HIS system transition can be taxing. But with the right expertise, you can make it as straightforward, efficient, and productive as possible. Change Healthcare provides healthcare organizations as much – or as little – help as they need to enable successful A/R wind-down.

Contact us to learn how we can be of service.

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