Revenue cycle has become a critical lever for health systems navigating rising costs, reimbursement pressure and increasingly aggressive payer behavior. For Ontario, Calif.-based Prime Healthcare, it is also the foundation of how the organization approaches hospital acquisitions and executing financial turnarounds.
Sunitha Reddy, chief revenue officer and vice president of operations for Prime, recently joined the Becker’s CFO and Revenue Cycle Podcast to discuss the system’s “revenue cycle playbook” — a standardized, end-to-end approach designed to stabilize financially distressed hospitals, scale best practices quickly and align clinical, operational and financial performance.
As AI and automation rapidly reshape both payer and provider strategies, that playbook is also evolving to support a more proactive, data-driven revenue cycle workforce.
Editor’s note: This is an excerpt from an episode of the “Becker’s CFO and Revenue Cycle Podcast.” Responses are lightly edited for length and clarity. Click here to listen to the full episode of the podcast.
Question: What are the 3 trends you’re paying most attention to in healthcare today?
Suntiha Reddy: There’s a lot happening right now, but I would highlight three major, interconnected trends.
The first is the financial pressure facing hospitals today, especially community hospitals serving vulnerable populations. Labor costs continue to rise, Medicare and Medicaid rates are not keeping up with the cost of inflation, and recent legislation, including HR1, represents some of the most significant Medicaid funding reductions in decades. The Congressional Budget Office estimates over $900 billion in Medicaid cuts over the next decade, with millions potentially losing coverage, and that creates a real sustainability challenge, particularly for community hospitals. It makes it increasingly difficult to operate without strong operational discipline and the ability to operate at scale.
The second is the growing complexity and payer behavior. Denials have become one of the most significant operational and financial headwinds we see today. Health plans are becoming increasingly aggressive, whether that’s through prior authorization denials, level-of-care downgrades or retrospective reviews — truly just finding more ways to delay, deny or underpay claims. Recent data from CMS and OIG show that initial denial rates are around 20% for Medicare Advantage and even up to 40% for some managed Medicaid plans. What’s especially concerning is that a majority of patients never appeal these denials, due to the complexity or lack of resources. This is creating a significant administrative burden on providers and putting real pressure on hospital financial sustainability.
The third trend — which everyone’s talking about — is really automation and the acceleration of AI in healthcare. This is being largely driven by both labor constraints and the general need for greater efficiency. There is a real opportunity to automate repetitive workflows, improve accuracy and proactively manage denials. At Prime, we’re really focused on using these tools to reduce administrative burden on clinicians, whether that’s helping with prior authorizations, appeals or documentation — with the goal of allowing them to focus on patient care.
When you step back, all of these trends reinforce that revenue cycle is no longer just a financial function; it’s central to ensuring access to care and the sustainability of the healthcare system.
Q: What are the specific benefits community hospitals see when partnering with a large health system such as Prime Healthcare, and how can they better combat some of those pressures you mentioned?
SR: At Prime, our mission is centered around saving hospitals and ensuring continued access to care, particularly in underserved communities that are so impacted. Many of the hospitals we acquire are financially distressed, so our focus is on stabilizing them quickly while maintaining high-quality care.
One of the key differentiators at Prime is how we view revenue cycle. It’s truly not a back-office function — it’s core to transformation and helps drive hospital sustainability. That mindset shapes how we operate every day, particularly as we continue to grow through acquisitions and scale best practices across the system.
Our approach starts with a true end-to-end view. We’re not just focused on billing and collections. We’re looking across the entire revenue cycle continuum: patient access, utilization management, appropriate clinical documentation, coding, revenue integrity, denial management and managed care. All of those functions come together and are looked at collectively and holistically. Importantly, we manage all of these functions in-house, which is somewhat unique, and it creates strong alignment between operations and financial performance. We also have really strong corporate teams that support these functions at scale.
The second piece is really the speed and standardization at Prime. The majority of our system — 34 hospitals now — are on Epic, and we’ve built a defined revenue cycle playbook for new acquisitions. That allows us to quickly implement standardized workflows and reporting, especially in those critical first six to 12 months after an acquisition. We’ve also come a long way in standardizing our revenue cycle management technologies and vendors, so we can implement these tools and partners at scale efficiently.
The third — and I think this is really unique to Prime — is our clinical alignment. We’re a physician-founded and physician-led organization, and our clinical leaders are actively engaged in revenue cycle operations, denial management and care delivery decisions. That alignment improves both quality and financial outcomes for the organization.
Another key focus is managed care. Most of the hospitals we acquire have challenging payer mixes, often heavily weighted toward Medicare and Medicaid, so ensuring appropriate reimbursement is critical. We take a data-driven approach to evaluating contracts to ensure rates are sustainable, competitive and aligned with the cost of care. Often, when we first acquire these hospitals, the issue isn’t just operations — it’s that reimbursement from managed care hasn’t kept up with the true cost of care.
Finally, we’re very data-driven and monitor performance rigorously. We track metrics like denials, cash collections and underpayments very closely. That makes Prime unique in that revenue cycle is a shared responsibility across leadership — it’s not siloed within one department, and it’s not fully outsourced.
That level of integration and accountability across operations, clinical teams and revenue cycle leadership is a key differentiator for Prime and has been critical to executing turnaround strategies at scale. When you put it all together, it’s really about standardization, alignment and a defined operating playbook that allows us to stabilize these hospitals at scale.
Q: From a revenue cycle standpoint, what’s the kind of key lesson that you might have learned through some of these previous acquisitions?
SR: We’ve been through this now with 38 hospitals, [most recently] with three hospital acquisitions in Maine and we truly believe healthcare is local.
I talked about a lot of these different levers that we focus on during these transitions, but what really makes Prime unique is that we look at each hospital individually. We assess the market, figure out what key service lines are needed and try to do the same thing on the revenue cycle side to make sure we’re supporting the teams that are there and the existing operating model.
There’s no one-size-fits-all revenue cycle solution that we implement. We really work with the teams, the communities and the hospital leadership to figure out how best to support them — both financially and operationally.
Q. How do you see this “AI arms race” evolving in the coming years as AI becomes more sophisticated and more deeply integrated into the revenue cycle by both payers and providers?
SR: We’re really seeing both payers and providers invest heavily in AI, but with very different objectives. Payers are using AI to scale claims — they’re automating denials and increasing payment scrutiny at much higher speed and volume. Providers, on the other hand, are using AI to improve accuracy and efficiency, particularly in areas like documentation, coding and denial prevention to ensure appropriate reimbursement.
As payers become more automated, we’re seeing increased volume and speed of denials. That’s creating additional pressure on providers to implement this technology and catch up.
Another thing we’re seeing is a potential shift toward a more predictive, and eventually more autonomous, revenue cycle. Instead of reacting to issues after the fact, we can try to identify documentation gaps up front, predict denial risk before submission and resolve authorization issues earlier.
That said, there’s still a long way to go for providers to seamlessly adopt these tools. AI in healthcare is not plug-and-play — it requires thoughtful integration, strong operational teams and ongoing governance, especially with the introduction of agentic AI.
We’re really focused on using AI to support our teams, not replace them, and ensuring we have appropriate oversight, accuracy and compliance — especially on the patient-facing side.
I believe success will come down to three main things. First is how well AI is integrated into workflows across the end-to-end revenue cycle. Second is how organizations adapt their operating models to implement AI — because this is as much about people and processes as it is about technology. And third is governance and accountability.
Ultimately, this isn’t just about efficiency. It’s about access to care and trust in the system. AI has the potential to reshape the revenue cycle, but it has to be implemented thoughtfully to truly deliver on that promise.
Q: Is there an area you’re particularly excited about when you think about AI and automation in the revenue cycle?
SR: We’re looking at where all the opportunities are to implement AI in the process. On the revenue cycle side, it’s mostly happening in phases. The first is how we integrate more [robotic process automation] opportunities to take on some of that manual, transactional work. We’re really thinking about ways to better integrate AI more broadly into the system. It all ties back to identifying areas where we can more seamlessly embed these AI solutions throughout the revenue cycle continuum.
Q. How are you seeing revenue cycle teams evolve as AI becomes more embedded in workflows? What skills will define the next generation of revenue leaders?
SR: We’re already seeing a meaningful shift in how revenue cycle teams operate. Historically, as I mentioned, the work has been very transactional, focused on billing and collections. But as automation and RPA take on more of that work, the function is becoming much more analytic and strategic. Teams are now focused on understanding what’s really driving performance — whether it’s denials, payer behavior or documentation — and addressing those issues more proactively.
This is showing up in a few ways at Prime. First is a stronger focus on data-driven decision-making, using data to drive action, not just reporting. Second is deeper alignment and integration with clinical teams, since documentation and care delivery directly impact revenue cycle performance. And third is the growing importance of technology leadership: really understanding how to evaluate and implement tools like AI in a way that actually improves outcomes.
I believe that shift in the use of AI is driving a different skill set for leaders. You need data literacy, cross-functional leadership and adaptability, because the environment is changing so quickly.
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