Revenue cycle management is exactly what it sounds like: a technique that healthcare providers can employ to manage their revenue cycle’s administrative and clinical duties. The revenue cycle begins when a patient contacts a healthcare practitioner to plan an appointment. When all fees for the visit and treatment have been collect, the cycle is complete. The purpose of revenue cycle management is to identify and resolve any areas of friction in the provider’s revenue cycle. Care providers can maximize claim reimbursements and improve income with efficient revenue cycle services companies.
The Healthcare Revenue Cycle Steps
There are numerous steps in the healthcare revenue cycle. This means there are numerous opportunities for mistakes to occur. Any faults in the revenue cycle might cause the provider’s reimbursement from insurance and patients to be delay or halted entirely.
Let’s take a look at the processes in the healthcare revenue cycle to get a better grasp of where errors can arise and how RCM can prevent them:
Pre-approval and eligibility verification
When a patient schedules an appointment, the healthcare provider gathers information in order to create a patient account. This includes gathering the patient’s insurance information and verifying their eligibility for coverage.
Even if a patient already has an account with the provider, revenue cycle management highlights the need of correctly completing this stage. Incorrect information or ineligible insurance will result in a claim being deny later in the revenue cycle. This means that the provider’s reimbursement payment will be delay. It also involves more work for the clinician, who must then go over the patient’s information to remedy any inaccuracies.
Capturing and coding of charges
Charge capture is the process of converting patient treatments into billable charges by using globally accepted medical codes. These codes use by insurers to calculate reimbursement amounts.
The insurance company may deny the patient’s claim if proper medical coding is not used. As a result, provider reimbursement is delay. It also costs the provider time and money to investigate and appeal declined claims. Effective revenue cycle management ensures coding correctness, allowing denials to be avoid entirely.
Submission of Claims
The claim is forward to the insurance company for approval once a patient’s treatment has been properly coded. RCM guarantees that this submission occurs as soon as possible by tracking and managing the claim from the beginning of the process.
Examining Medical Billing Company services
Care providers are encouraged to study clinical treatment data when revenue cycle management is done thoroughly. Analyzing this data allows providers to discover where faults occur in the cycle and identify solutions to reduce costs. As a result, provider revenue will grow and the patient experience will improve.
Receipt of payments
Following the approval of the patient’s claim, the insurance company reimburses the physician depending on the patient’s eligibility. If there remains a balance after insurance reimbursement, the provider is responsible for contacting the patient to collect the balance.
Revenue Cycle Management’s Advantages
Effective revenue cycle management ensures that these processes are completed thoroughly and precisely, allowing providers to prevent revenue delays or loss. Although the primary purpose of RCM is to enhance provider revenue, it also provides additional benefits. These benefits benefit both providers and patients, making revenue cycle management even more valuable.
Error Detection and Resolution
Implementing RCM allows healthcare providers to more quickly identify where errors occur in the revenue cycle. This reduces the likelihood of claim denials because over 90% of claim denials are attributable to easily avoidable technical errors, such as missing information in the patient’s chart or incorrect coding. When these errors are avoid and claims are grant on the first attempt, providers receive their payments fast. They also save money by not having to investigate and appeal disallowed claims.
Claim denial prevention can result in an additional $5 million in revenue for the average hospital. 2 This figure alone should be reason enough for healthcare practitioners to inquire about how an organization can enhance its revenue cycle management.
Reduced Administrative Burden
Preventing claim denials also reduces the administrative load. Administrative staff members have more time and energy for patient care when they do not have to spend time and energy investigating and appealing refused claims.
Furthermore, RCM’s particular attention to front-end activities improves interactions between administrative personnel and patients. Appointment scheduling, intake form completion, and payment processing are all optimize to provide a better experience for everyone.
Preventing Healthcare Fraud
Another key advantage of RCM is its ability to prevent healthcare fraud and misuse. Every year, healthcare fraud costs the healthcare business billions of dollars. A fraud inquiry can cost a provider both income and reputation.
