By George Florentine, VP of Technology

Over the past several years, Flatirons Digital Innovations (FDI) has worked with dozens of customers in the healthcare industry as they upgrade their pay cycle systems and decommission their legacy applications. This blog highlights some of the lessons we’ve learned from these projects. We’ve characterized the challenges and solutions into distinct areas that are present in most of our engagements. It concludes with a brief description of Flatirons Digital Hub for Healthcare, FDI’s revenue cycle archiving solution.


As part of an application rationalization process, we evaluate the current usage of a pay cycle system. If the system is in read-only mode, has positive account receivable (AR) balances, and is hosted on old infrastructure, it’s a great candidate for migration into an archive capable of performing certain revenue cycle activities such as accounts receivable collection.

Conversely, if the pay cycle team is still actively adding AR assets into the system, and there are active integrations with 3rd party debt collection agencies, the system is probably not a good candidate for archiving at the present time.

AR Burndown

The largest business driver for migrating data from a legacy pay cycle system into a modern archive capable of processing AR payments is the presence of non-zero balance AR accounts in the legacy pay cycle system.

Depending on the age of the accounts, these assets maybe be qualified as account receivable or long-term receivable assets. In either case, these are assets that the company wishes to collect and turn into cash.

In many cases, these assets are several years old and aren’t migrated to a current pay cycle system because the production system doesn’t have information on the account or patient information contained in the legacy system. In this situation, migrating the AR assets into a modern archive capable of managing AR debits (frequently called “AR Burndown”) is strongly encouraged.

Collecting these outstanding AR assets has a positive impact on cash flow and AR turnover ratio, and it improves the company’s balance sheet by reducing the bad debts ratio.

For this business activity to be supported, the archiving system must be able to make updates that represent individual AR entries that have been either collected or reclassified in some way (bad debt, refund, charity, etc.). Paradoxically, it’s important for regulatory reasons that the actual state of the system at date of archive be preserved. Our customers have satisfied both requirements by using our revenue cycle archiving solution.

Collection Metrics and Functions

Legacy pay cycle systems typically have light activity, but this activity and the state of the archive can still be measured using some important metrics:

  • OFC – Current out-for-collection value. Useful in determining collection activity post-archive.
  • OFC at time of archive – Useful as a benchmark. When compared to current OFC and by ranking OFC for accounts, this metric is useful for determining efficacy of collection activity and accounts that merit collection activity.
  • Filtering on transaction line item entries – A legacy pay cycle may have hundreds or thousands of line items associated with an individual account. Applying filters by transaction type (charge, payment, refund, note, etc.) allows the rev cycle team to quickly make informed decisions about workflows related to account collection activities.
  • Export for audit – Certain regulatory audits or patient-related requests pursuant to HIPAA requirements may require the provider to deliver detailed information on account activity. An effective archiving solution will support the export of either summary or detailed account information based on the nature of the request.

Integration with Current Pay Cycle Systems

Whether AR collection is done in-house or outsourced to a 3rd party, it’s essential that the pay cycle team be able to easily track the progress of account collection activities. In-house staff use the current pay cycle system continuously, so an easy way to access the archive from the current pay cycle system is essential.

Ease of Use and Cost of Ownership

Legacy pay cycle systems may contain AR or long-term receivables for several years and access to the archiving system may be intermittent. These two requirements – long-term and infrequent access – emphasize the need for an extremely easy-to-use application.

Flatirons Digital Hub for Healthcare

Based on our work with customers over the past several years, we developed a revenue cycle solution for legacy data called Flatirons Digital Hub for Healthcare. It provides the following essential capabilities to support archiving for revenue pay cycle systems:

  • A web-based, cloud-first archive that can report on key revenue cycle metrics and support the AR burn down process. The solution minimizes mouse clicks, reduces the number of fields that must be accessed to enter an update to an account, and minimizes the monthly cost of operation.
  • Expresses domain principles in software to support the pay cycle user. For example, the system understands the characterization of various activities as either a debit or credit event and records transaction amounts and provides summary information appropriately.
  • Can be hosted either on prem, in a private cloud or in a public cloud.
  • Supports pay cycle, clinical, and HIM-focused interfaces in a single cloud instance, further reducing the complexity and cost of system ownership.
  • Supports tabular, document, and image artifacts in one architecture (minimizing the operational cost, deployment, and upgrade complexity) as well as disaster recovery strategies.

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