IT-Enabled Revenue Cycle Transformation in Resource-Constrained Hospitals: A Collaborative Digital Options Inquiry

Abstract

Although hospitals increasingly consider solutions based on information technolgy (IT) for revenue cycle management, contextual constraints and numerous IT investment alternatives make it difficult to identify and realize appropriate solutions. Thus far, however, health IT theory has been silent on how IT can support financial and administrative purposes within hospitals, focusing instead on IT for clinical support. Against this backdrop, we report on an action research project involving IT-enabled revenue cycle transformation in a financially strapped rural hospital. Our research contributes to health IT theory by expanding the discourse to include revenue cycle transformation and by demonstrating how resource-constrained hospitals can improve their financial performance through selective investments in low-cost IT solutions across the revenue cycle. We also contribute to action research methodology by generalizing our interventions to propose digital options inquiry—a systematic approach to business process transformation that combines digital options theory with diagnostic process mapping—to help researchers and practitioners jointly understand and transform business processes.