Revenue cycle management in healthcare plays a crucial role and helps healthcare providers achieve adequate reimbursement.
For healthcare providers, medical billing and patient care are both mandatory. Healthcare revenue cycle management bridges the gap between these aspects. RCM comes with a set of challenges posing a burden on healthcare providers and practices.
Reaching an optimum revenue cycle management healthcare is challenging and that is why this blog highlights all the details about revenue cycle management.
By the end of this blog, healthcare providers will get a clear idea of how to navigate through the complex landscape of revenue cycle management.
Let’s get straight into the blog...
Explaining the Purpose of Revenue Cycle Management Healthcare
Healthcare providers and practices aim for financial stability and revenue cycle management healthcare works to achieve the same. Handling everything from the beginning of the medical billing process to the end constitutes revenue cycle management.
Healthcare providers and practices must ensure accuracy and efficiency in steps like registration, documentation, claim filing and claim submission to achieve desired reimbursement results.
That is not all, they then have to take care of denials and take active steps to recover the lost revenue, deal with insurance companies and make sure compliance standards are met. All these factors are significant to maximize the bottom line and optimize operational flow.
Whether healthcare practice is big or small, revenue cycle management is the most important task. Failure to maintain the balance can disrupt functioning and affect quality patient care.
Important Steps for an Effective Revenue Cycle Management in Healthcare
Now that we know the purpose of revenue cycle management healthcare, let’s learn about the steps in the medical billing process.
The steps are:
Scheduling of Appointments
The first step is appointment scheduling, which is quite complex and multifaceted. Healthcare providers must allot appointments to all patients whether they have fixed, flexible, wave scheduling, or patient self-scheduling.
Healthcare providers must maintain accuracy at this step and record basic details like patient names and contact information with precision.
Patient Registration
The next step is patient registration, this happens when a patient visits the healthcare facility. When the patient intake happens, other details must be recorded such as patient demographics, medical history and insurance details. This step is also designated for insurance eligibility verification and prior authorization.
Medical Coding
Then comes the time for charge capture, which is also known as medical coding. This step takes place after the patient has received a diagnosis or treatment. The rendered services are translated into accurate CPT and ICD-10 codes based on the ailment.
This step needs precision as the chances of making mistakes are higher. Accurate coding leads to clean claims, which is why it is essential.
Claim Filing and Submission
Once medical coding is complete then the claim is filed and submitted to the insurance company. In this step, the important part is submitting claims at the right time. Insurance providers set a time frame and in the case of delays, the claims result is denials.
Keeping this in mind, healthcare providers must ensure timely submission of claims to avoid denials due to this reason.
Denial Management
After the submission, claim processing starts by the insurance companies. During this time, many claims may get denied. Denial management pays attention to the claim processing and tries to rectify denied claims. Most claims can be recovered with a simple process of correction and refiling.
Follow-up for Accounts Receivables
Another vital part that needs attention is outstanding charges. This is also a part of the steps in medical billing. Healthcare providers need to identify unpaid charges and then follow up on the same and try to recover the amount.
What Makes Healthcare Revenue Cycle Management Challenging?
The complexity of a medical specialty is directly reflected in the revenue cycle management of healthcare. The intricacies are not limited to the medical billing process. Healthcare providers must manage administrative tasks, balance operational costs and provide quality patient care at the same time.
On the other hand, medical billing needs knowledge and expertise in coding for different specialties. Not all healthcare providers and practices can be well-versed in the coding requirements. This enhances the challenges of healthcare facilities.
A healthcare practice can be sustained only when it can acquire financial stability. Revenue cycle management healthcare indeed plays a major role in improving the financial state of any medical facility or physician.
If a healthcare practice chooses to keep an in-house staff, it must deal with other things such as providing good infrastructure, paying staff salaries, and handling things during staff leaves and holidays.
Trying to take this responsibility can result in efficiency and hamper the workflow of the healthcare practice. Thus, healthcare providers suffer losses and revenue leakages.
Objective of Revenue Cycle Management in Healthcare
Healthcare revenue cycle management aims to maximize the bottom line while improving the practice management and operational flow. The goal is to identify the shortcomings in the medical billing process and take measures to make positive changes.
After managing the medical billing process efficiently and with accuracy, revenue cycle management works towards attaining complete compliance and eliminating the scope of misuse or fraud.
All in all, RCM is meant to perform all steps in medical billing, fulfill all regulatory standards, stay current with changes and try to achieve adequate revenue for healthcare practice.
Advantages of Revenue Cycle Management in Healthcare
An efficient healthcare revenue cycle management can elevate the overall functioning of healthcare practices. The first benefit of robust revenue cycle management is better financial performance. Other things that improve are patient experience and compliance with regulatory standards.
Let’s elaborate on these points:
Better Financial Performance
A reduction in errors and missing details in all medical billing steps is a sign of streamlined revenue cycle management. More accuracy means fewer denials and revenue leakage which further contributes to adequate reimbursement.
A comprehensive improvement in the process enhances the scope of maximizing revenue, eliminating shortcomings and fulfilling all compliance needs. This uplifts the flow of cash and results in financial stability.
Great Patient Experience
Proper revenue cycle management means productivity in every aspect of managing healthcare practices. The streamlined workflow also translates into patient convenience and satisfaction.
Meeting Compliance Requirements
Revenue cycle management helps healthcare practices in staying up to date with changes and regulatory requirements. This way healthcare providers and practices can prevent sensitive patient information from misuse and avoid any legal consequences.
Common Challenges in Healthcare Revenue Cycle Management
As healthcare revenue cycle management is detailed, challenges are bound to occur. Understanding these challenges gives a clear insight into treating the root cause behind the complexities.
Here are the common revenue cycle management challenges:
Need for Precision in Coding and Billing
A smooth cash flow is dependent on accuracy and to-the-point coding and billing. This is the most challenging part of medical billing as well. Coding requires a deep understanding and knowledge of CPT and ICD codes along with relevant modifiers. There are more chances of making mistakes with limited coding knowledge.
Inaccurate coding is also a common and one of the most persistent reasons behind claim denials and revenue loss. Medical coding is the process of translating every rendered service into its decided code. Usually, a single specialty has multiple codes that are hard to remember. Manual errors occur and coding errors happen resulting in a lower clean claims rate.
Realizing Compliance Requirements
Another challenge is meeting compliance requirements. This difficulty exists because compliance standards keep changing in a short period with new rules or policies.
The most vital compliance standard that all healthcare providers and practices must follow is HIPAA (Health Insurance Portability and Accountability Act). This act makes healthcare providers responsible for the protection of sensitive patient information from misuse.
Fulfilling Credentialing
Credentialing is mandatory for all healthcare providers and practices. This means connecting and getting into the insurance provider’s circle. This is important to be recognized as a credible healthcare practice to achieve adequate revenue. This process acts as a security for healthcare providers which is essential for better revenue cycle management.
Incorporating Data Analytics
Data analytics gives an insight into the administrative functioning of a healthcare practice. Healthcare providers can know their shortcomings and the areas of errors or missing details. Data analysis brings everything about revenue cycle management to notice. However, despite the usefulness of data analytics, incorporating it into the complex medical billing process is a challenge for many healthcare providers and practices.
Ways to Improve Revenue Cycle Management in Healthcare
Improving revenue cycle management is not just a choice but a necessity for healthcare providers and practices. There is no doubt that managing everything without assistance can be burdensome and stressful for healthcare providers.
Some clinics and physicians try to handle medical billing with the help of an in-house medical billing staff. However, this method can be more expensive and may not deliver the desired results.
Therefore, healthcare providers and practices must choose to outsource their medical billing process to experts. Medical billing services can help them navigate through the complexities and lead to optimized results.
Outsourcing partners work with proficient teams of coders and billers who understand the common challenges and the way to counter them. They also incorporate advanced technologies so that there are limited errors and denials. As a result, healthcare providers and practices achieve adequate revenue and a smooth operational flow.
How to Choose the Right RCM Provider?
Choosing RCM provider in healthcare can be a little tricky from healthcare providers as there are various services available. So, if you are looking for a reliable medical billing company check the following points:
- Expertise in your specialty and if you run a healthcare practice, then a multi-specialty outsourcing partner. This will ensure excellence in coding
- Check for the range of services offered such as coding, claim filing, submission, payment posting and denial management. These are vital features of revenue cycle management.
- Technological advancement and innovation to counter the challenge of manual errors or missing details. A good RCM service provider would have a grasp of technology to streamline the medical billing process comprehensively.
- The RCM provider must follow compliance rules and must focus on data security by following HIPAA standards. Other updates in coding must also be a priority for the RCM provider.
- Data analytics and reporting must be on the list of features. These help in identifying drawbacks for corrective measures and improve areas such as claim denials and collection rates.
- Ensure that your medical billing partner has good communication and that they offer service flexibility. An RCM provider who supports and provides training and assistance is a good option.
- Also, check their pricing structure for various services and check for hidden costs to choose the right RCM provider. Also, check their pricing structure for various services and check for hidden costs to choose the right RCM provider.
FAQ's
Why do you need a medical billing professional?
Medical billing professionals are well-versed in the medical billing process, the steps and the challenges. They help healthcare providers and practices eliminate manual errors and reduce denials to maximize revenue and improve operational flow. They also help healthcare providers in staying current with medical billing trends, rules, regulations and policies. As a result, healthcare providers streamline their medical billing process and help in achieving revenue goals while maintaining the quality of patient care.
How is healthcare revenue cycle management relevant to medical billing and coding?
Healthcare revenue cycle management is an essential part of medical billing and coding. The medical billing process and revenue cycle management have a common goal of maximizing reimbursement. They aim to improve the financial posture of a healthcare practice. Considering this, revenue cycle management is relevant to medical billing and coding.
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