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Health Club Revenue-cycle Management: What Is It And Why Does It Matter?

By: ABC Financial

This is part one of a two-part series by ABC Financial Services on revenue-cycle management and how optimizing the revenue cycle management means better service and financial outcomes for health clubs.

Any club owner recognizes that it’s critical to turn booked membership revenue into dollars in the bank. In many industries, from financial services to healthcare, the combination of proven technologies, processes and people that make this happen is referred to as revenue-cycle management or RCM. But how and why should club operators rely on RCM to succeed?

Revenue-cycle management refers to all the technology, process and people interactions that come into play to manage billing, handling delinquencies, supporting member issues, maximizing deposits and providing reporting and accounting to provide complete transparency. Revenue-cycle management commonly increases the amount of revenue received from billings by 5-7% and, in some cases, even more.

Revenue-cycle management is sometimes confused with billing. Sure, a billing company can send out bills or drafts. However, this doesn’t help address leaks in an accounts receivable process, nor does it include servicing customer inquiries or customer retention opportunities. Many industries have come to a keen understanding of how important revenue-cycle management is to financial viability. Successful health club operators are starting to grasp the importance of this concept for their industry as well.

ABC Financial’s CEO Bill Davis defines RCM as “a comprehensive approach to optimizing revenue management at every stage of the financial life-cycle of a business, integrating operational software with staffing and business processes, resulting in full transparency and rich insights from book to cash.”

To account for and effectively manage all the elements that make up revenue-cycle management is a significant ask for clubs. Because of the scale of shared operations, the better approach is to partner with an organization that can invest in the automation, process, hiring and ongoing training and quality control requirements and share those costs across clubs.

ABC’s continued investment in this area allows clubs to deliver an enhanced member experience and improve retention rates while avoiding sensitive and revenue-impacting late or missed payments. An RCM solution, when designed appropriately, automatically maximizes an organization’s book-to-cash efficiency

Without a comprehensive approach to RCM, clubs often fail to efficiently collect the funds they are owed and put their member’s experience at risk. The benefits of effective RCM include, among other things:

1. Increased revenue

2. Decreased days in accounts receivable

3. Reductions in payment declines

4. Accelerated and steady cash flow (book to cash)

5. Fewer member accounts being referred to collections

How do organizations optimize their revenue-cycle management? The essential components of an optimized RCM system are (i) the right technology, (ii) a disciplined process, and (iii) well-trained people.

The Right Technology

When evaluating the best approach to revenue cycle management, technology is a commonplace to start. Is your provider managing the continual upgrade requirements and regulatory shifts? How are security and cybersecurity risks managed and being proactively addressed? What technology roadmap has been adopted to address not only the management of the revenue cycle management of today and tomorrow? Given the rate of change, expertise in both assessing current approaches and understanding long-term needs is essential to understanding how best to deploy technology and collect more revenue, faster.

Disciplined Process

Understanding how to effectively design the right RCM process is specialist knowledge. This can include adaptive, automated approaches to re-attempting charges, remediating failed payments, and more. Is the process established in every detail, does it consider every contingency, and are best practices implemented and continually optimized? Are customer touchpoints well designed and fully thought out? Is the data collection process compliant with privacy requirements? These and many other considerations are part of designing a highly-disciplined process necessary to implement the right approach to collect revenue missed on the first collection path.


With a disciplined process and the right technology tools in place, the final and most critical aspect is staffing. Establishing and maintaining a staff adept at all the aspects of revenue-cycle management is challenging. Tackling this in-house is risky as the cost of training and retaining staff continues to rise and the expertise needed to stay ahead becomes more specialized.

Having a trusted and capable partner to guide your club through revenue-cycle management is critical. Your solution partner should provide the right software tools, processes, and expert staff to the table. This will be essential to gaining the right insights that help achieve growth, enhanced profitability, and better member experiences in a highly competitive market. ABC Financial is the partner of choice for leading fitness, health club, and gym brands. The team at ABC Financial is here to help. Let’s discuss how you can succeed in 2020.

About ABC Financial Services

ABC Financial ( is a premier provider of technology and related financial services for the health and fitness industry, renowned for exceptional client service for clubs and their members. Its market-leading billing and collections solutions automate the revenue cycle management that enable owners and operators to achieve better financial performance, all in a Software-as-a-Service and cloud-based platform. ABC’s comprehensive technology solutions include DataTrak advanced health club management and MYiCLUBonline extensible member engagement platforms that allow owners and operators to efficiently manage employees, members, resources, sales and drive improved member engagement. Founded in 1981, ABC helps more than 7,500 health clubs across the United States, Canada, Mexico, and Puerto Rico perform better and more profitably. ABC Financial is a Thoma Bravo portfolio company, a private equity firm based in San Francisco and Chicago (