With the present turn out of events in 2020, specialized RCM Solutions in healthcare is a must. With the recent outbreak of a global pandemic, COVID-19, healthcare centers can’t function without employing specialized RCM services which assist them in this crucial time by sharing their burden and preventing them to collapse due to excessive burden. There are some other reasons described below that shed light on the importance of RCM Solutions in healthcare.

Information directed to patients

The best RCM solution is the one that provides up to date information to your patients and helps in increasing your reach by strengthening customer trust.

Improvement in management of claims

Outsourcing expert RCM solution improves the management of claims by handling them professionally and without error. The rate of reimbursements is increased; claims denial is reduced from 4 to 7 percent that ensures efficient management of claims and revenue cycle. Hence the cash flow is increased.

Reduction of errors in billing

The first and foremost duty of RCM specialists is to ensure error-free billing. This task is performed by a team of experts who have up to date and advanced level knowledge. This reduces the possibility of errors due to the incompetence of the staff. It also reduces the burden on the medical practices of training their staff from scratch.

Streamlined cash flow

Leaving your medical practice at the mercy of orthodox administrative methods can increase friction at each step of your billing and coding. These traditional methods are subjected to human error and can increase the risk of collapsing the entire cash flow and billing system. RCM specialists increase the efficiency of the medical practice and reduce the probability of human error as there is a team working in collaboration for this task rather than a single person. This team is responsible for ensuring a streamlined cash flow by collecting payments timely.

source:bhmpc.com

The solution to compliance issues

To cope with the increased compliance issues resulted from in-house record keeping and billing, getting expert RCM services is always a good idea. It keeps you updated with the growing trends and changes. It ensures effective management of claims rejection and compliance issues. it solves all the compliance issues across various departments reducing the clashes between administrative and billing processes. Getting these services saves a lot of time and energy used up in management tasks and in getting updated with the compliance trends.

Effective analysis

Specialized RCM solutions are effective in providing streamlined front desk services which in turn improves the working of back end operations. To manage revenue efficiently, these RCM solutions employ effective tools for the prediction and analysis of billing trends. Not only do these analytic tools monitor billing trends but they also set up evaluation reports that help to improve the service in the future.

Remaining updated with the industry

With changing trends each day and innovations in the medical services, it is impossible for a medical service provider relying on the manual billing process to work effectively while the world is moving at a fast pace. The only way to keep up with the innovations and updated systems in the medical field is to transfuse your medical practice with an expert RCM service. RCM specialists are in every aspect better than manual billing service providers. They are effective in keeping up with all the coding and billing updates hence reducing the stress of administrative and billing tasks.

Patient satisfaction

The primary goal of every medical service provider is to give quality medical services to all its patients and in turn, get patient satisfaction and reliability. Patient satisfaction is the key to attracting new patients and keep established patients coming. With RCM solutions the streamlined processes increase patients’ satisfaction and reliability on the medical service provider.

In addition to the services mentioned above a specialized RCM solution also provides services such as cost optimization, collaboration among stakeholders, better business strategies and data cohesion. It is almost impossible for a medical service to keep up with other healthcare providers without outsourcing RCM solutions.

According to a report from Sage Growth Partners, more than a third of health systems have faced more than $10 million in bad debt annually. The situation is worsening due to unpaid bills and every year up to $125 billion is lost in unpaid and underpaid claims. This is why an increased number of healthcare providers are seeking the help of revenue cycle management providers to revamp and automate their revenue collection process, and to receive the immense benefits of revenue cycle management in healthcare.  

The purpose of Healthcare Revenue Cycle Management (RCM) is to manage the entire revenue cycle of the healthcare providers and ensuring there is no delay due to redundant tasks and revenue collection leaks. The RCM process starts with the patient scheduling a visit, receiving the care and concludes with paying the care services provider. The process can be enlisted as:

• Patient eligibility check and insurance authorization
• Medical coding and billing, charge capture
• Claim preparation and scrubbing
• Claim submission
• Payment posting
• Denial management
• Account receivable follow-ups
• Patient statements
• Reporting and audit

Revenue cycle management (RCM) in healthcare serves as the central process that streamlines the processes, ensures steady collections and makes the healthcare providers financially viable.  

Here are some benefits of revenue cycle management in healthcare: 

What is Purpose of Revenue Cycle Management in Healthcare?

source:revcycleintelligence.com

Improved Patient Experience

Effective revenue cycle management eliminates the redundant processes, simplifies the complexities, streamlines the system. This lowers the administrative burden of the care providers and they focus more on delivering quality care services. Efficient revenue cycle management with the automation of the processes improves all the touchpoints of a patient journey and concludes the process with timely payments. 

Reduced Administrative Burden

Although the RCM process runs along with the patient walkthrough but managing it is a complete job that requires focused attention of the revenue cycle management resources. This is why most of the healthcare services providers seek services of the professional RCM vendors that can effectively manage and automate their revenue cycle. By outsourcing and automating the revenue cycle, healthcare providers can set them free from different administrative tasks which include resource management, billing, and coding, managing the claim preparation and reimbursement process. More availability of time helps them focus on delivering quality care. 

Elimination of Errors and Redundancy

Mostly RCM vendors also provide medical billing and coding services. Delay in the collection process occurs due to errors in the billing documents. Medical billing solutions combined with revenue cycle handling helps in eliminating the errors and it removes the redundancy in the system. Error-free billing and collection workflow maximizes the revenues of healthcare providers.  

Fewer Denials

When the revenue cycle is optimized and eliminates the errors in the system, it automatically lowers the denial rate. Payments of the healthcare providers are denied and due to errors in the payment claims and when these errors are removed, it minimizes the denial rate. 

Simplified Processes

Revenue cycle management and automation help in simplifying the front desk and back-office processes. The automation of the system if managed with the right clinical technologies such as the electronic health record (EHR) system, can simplify the workflow. It improves the scheduling process, coding and billing, and payment processing. Removing the complexities in the workflow is a must to improve the operational efficiency of the providers and to make sure that they are meeting their revenue targets.     

Maximizes Collections and Revenue

source:revcycleintelligence.com

Effective revenue cycle management optimizes the collection process. RCM providers can handle the incumbent tasks along with backlogs such as payment denials and follow-ups, and make sure that the services providers are timely reimbursed. The process brings accuracy to the system and leaves little room for errors. The process if combined with the automation tools and software applications, all the time taking tasks such as insurance verification, coding, and claim processing takes less time than manual handling. An optimized workflow helps in maximizing the collections. 

Faster Collection Process

Revenue cycle automation expedites the collection process by automating the tasks and lowering the administrative burden. When most of the processes are automated, such as the staff is required to enter the patient demographics once, automated eligibility checks, reminders, payment follow-ups and charge entry. The automation and accuracy of the revenue cycle help in faster collections. Providers prepare their bills in less time, and time submission improves the collection process. Read this comprehensive guide to improve the RCM Process.

Healthcare providers can significantly improve their revenue collections through effective revenue cycle management. For instance, a community hospital in Illinois observed a 300 percent increase in patient collections with the automation and integration of front-end and back-end processes. This is a major leap in the right direction and sets an example for other healthcare services providers.

Managing the RCM in-house can be expensive and involves consistent effort from the management team to manage different resources. With RCM services outsourced to a professional team, providers can focus more on improving the quality of care that can dramatically increase their revenue due to reduced operational cost, elimination of errors, and maximum collections.

Benefits of Revenue Cycle Management

1. Improved Cash Flow: Efficient RCM processes minimize the point of providing services and payment, which improves cash flow.
2. Reduced Denials and Delays: RCM identifies and reduces denied claims and delays, resulting in higher revenues.
3. Increased Operational Efficiency: Automation and optimized processes decrease administrative and operational costs.
4. Enhanced Data Analytics: RCM gives vital information about financial performance & patient demographics, which aids strategic decision-making.
5. Compliance Assurance: RCM assists healthcare firms in complying with legislation and payer obligations, hence lowering legal risks.

Goals of Revenue Cycle Management

1. Maximize Revenue: The main objective is to maximize income by implementing effective billing and collection systems.
2. Minimize Costs: RCM seeks to reduce operating expenses related to billing, collections, and administrative tasks.
3. Increase Collection Rates: RCM strives to increase collection rates by effectively following up on claims and patient accounts.
4. Enhance Patient Satisfaction: The goal is to guarantee that billing methods are clear and understandable, enhancing the patient experience.

Purpose of revenue cycle management in healthcare

The goal of Revenue Cycle Management (RCM) in healthcare is to improve financial procedures that help healthcare providers from the first patient encounter to the final payment. RCM strives to maximize revenue collection by assuring timely payments and eliminating claim denials through accurate coding and reporting. It improves administrative operations, increases efficiency, and reduces manual errors. Furthermore, RCM enhances the patient experience by establishing transparent billing policies and various payment choices, fostering confidence and pleasure.

Compliance with federal and state rules is a top priority, as it assists firms in adhering to best practices and avoiding legal complications. RCM also aids financial planning and budgeting with data-driven insights, while enabling the move to value-based care by tracking quality measures linked to reimbursement.

Endnotes

Managing the RCM in-house can be expensive and involves consistent effort from the management team to manage different resources. With revenue cycle management companies, providers can focus more on improving the quality of care that can dramatically increase their revenue due to reduced operational cost, elimination of errors, and maximum collections.

Still, wondering to improve the revenue cycle management of your organization? We are here to guide you further. We ensure every possible experience you might want to have to beneficially run your revenue management cycle. So you can focus on providing the best healthcare to your patients.

FAQs to know about the Purpose of of Revenue Cycle Management

1. What are the key steps in the RCM process?

The RCM process includes several steps:

• Patient registration and scheduling
• Verification of insurance
• Capture of charges
• Coding for medical
• Submission of claims
• Posting of payments
• Handling of denials
• Billing and collections for patients

2. What role does medical coding play in RCM?

Medical coding is critical in RCM because it ensures that healthcare services are accurately translated into standardized codes used for billing. Correct coding helps prevent claim denials and ensures proper reimbursement from insurance companies.

3. How can RCM help reduce claim denials?

By verifying that patient data, insurance details, and medical codes are correct before to claims submission, RCM helps lower the number of claims that are denied. Additionally, it includes rejection management procedures that monitor and address any mistakes that result in denials.

4. How does RCM support value-based care models?

RCM tracks and reports quality measures connected to patient outcomes in order to adjust to value-based care models. This guarantees that the quality of treatment rather than the number of services rendered by healthcare practitioners will determine their compensation.

5. What is the difference between RCM and medical billing?

Although it includes medical billing, RCM is a more comprehensive process. While RCM covers each financial activity from registering patients to payment posting, including rejection management and financial reporting, medical billing concentrates on filing claims to insurance carriers and collecting payments.

6. Can RCM help with out-of-network claims?

RCM can assist with out-of-network claims by spotting these kinds of cases early on, warning patients about possible expenses, and handling the difficulties of filing and monitoring these kinds of claims to guarantee prompt payment.

Future of healthcare revenue cycle management

The healthcare revenue cycle management market is experiencing extraordinary growth due to various factors. Healthcare organizations, especially small and medium-sized providers are experiencing a decrease in revenue due to the implementation of expensive healthcare technologies, increased operational costs and changing insurance policies. To reduce the healthcare costs and mostly the inability to handle changing dynamics of the market, small providers are selling them off to large groups and big healthcare providers. The demand and adoption of the RCM solutions are due to these factors and are serving as the stimulus behind the current market growth.

Most of the healthcare providers are looking to outsource their revenue cycle to third party RCM solution providers as they are specifically skilled in managing the billing processes and helping providers reach their revenue targets. Most of the small and solo medical practices lack the necessary expertise and resources to manage the collection process and which is further jeopardized by the inability to trace errors.

Errors in medical billing and coding are among the major reasons that cause revenue loss to healthcare providers. Inability to verify insurance eligibility, missing personal health information, and incomplete payment claims are some of the additional reasons for revenue loss. With support from RCM solution providers, more than 90 percent of denials can be prevented and which can significantly improve the revenue prospects of healthcare providers.       

RCM Trends

RCM solution providers who are using cloud-enabled technologies and are utilizing automation tools are in high demand. Cloud-based solution providers are capturing the maximum market as they are easier to scale up and do not require hefty hardware costs. All the financial data is easily available to both parties and they can access it from anywhere. This flexibility and accessibility of data and the convenient provision of cloud infrastructure, such as storage and easy integration with other systems make it more trending. Healthcare providers demand a revenue cycle management solution that is efficient, affordable and scalable.

Both patients and providers are yielding transparency in billing and reimbursement processes. As healthcare cost is rising it is making consumer of the healthcare services concerned on how the costs would be covered. Government and regulatory bodies are pushing for price transparency and require providers to adopt technologies and solutions that can help their consumers have a clear understanding of their healthcare spending.

The need for price transparency is further pushed due to hot issues such as surprise or out-of-network billing. Entrepreneurs and tech giants are entering the healthcare RCM market with innovative payment solutions.  

RCM was considered a group of backend processes where it deals with the preparation of claims, speedy submission, and collection; however, the recent trend has shifted RCM to optimize frontend processes. The shift of focus to front-end processes has further fueled the growth of technology-assisted automation.

A majority of providers are already using clinical technologies, such as electronic health record (EHR) systems, patient portals, online payment gateways, and front desk management services. These technologies are paving the path for automation of revenue cycle management.

Market Share

According to HTF Market Intelligence, some of the major companies that own the maximum healthcare revenue cycle management market share are Cerner, Mckesson, Quest Diagnostics, Allscripts Healthcare Solutions, Athenahealth, GE Healthcare, Eclinicalworks, Conifer Health Solutions, EPIC Systems, Gebbs Healthcare Solutions, Experian, R1 RCM, Constellation Software, The SSI Group, Nthrive.

Future Growth Prospects

The revenue cycle management market is growing at a fast pace and some of the major consumers are physician practices, hospitals, surgical centers, and ambulatory services providers. Approximately 1/4 of the hospitals, that is around 25.5% of the total healthcare market, lack healthcare revenue cycle management services. The North America Revenue Cycle Management (RCM) Market is expected to reach USD 52.7 billion by 2024, growing at a CAGR of 12.6%.

Healthcare RCM outsourcing

As healthcare providers are struggling with increased costs and lower collections, at the same time the majority of their resources and energies are focused on delivering quality of care they get less time to manage their revenue cycle. So, small medical practices and hospitals are outsourcing revenue cycle management to save time and resources. This is why, the demand for an RCM vendor or solution provider has doubled in the last few years. With the help of RCM solution providers, medical practices are focused on collecting more from patients. At the same time, outsourcing RCM lowers the operational costs, reduces the workload on internal resources, streamlines the claim preparation process and lowers the payment denial rate.

By outsourcing RCM, providers can focus more on delivering and improving the quality of care. They can expedite the claim submission process, achieve smooth cash flow, and reduce errors. Most of the RCM vendors are certified to handle data and have security and privacy compliance which makes it easier for the provider to meet standards without investing their resources in training and certifications.

Outsourcing to a professional RCM provider improves payment cash flow, lowers denial rate, enhances patient satisfaction, and helps providers meet their revenue targets. Sybrid MD can help you meet your revenue targets with streamlined billing, efficient front desk management, and integrated revenue cycle management solutions. We believe that when there is no medical revenue cycle management, 25%-35% of revenue is lost due to improper handling at the front office (missed phone calls, patient no-shows, poor follow-ups and collections). We can help to save from the revenue leaks and get maximum revenue collections.

What is revenue cycle management healthcare means for physician credentialing practices? The revenue cycle for a physician practice means tracking payments and revenue collection from patients. It starts with registration and scheduling of patients, proceeds to insurance verification, co-pay collection, handling health records, coding of clinical procedures performed, charge entry, claim scrubbing and submission, payment posting, denial management, A/R follow-ups, and compiling collection statements.

More than 23% of the total healthcare providers in the United States are independent practices which are mostly comprised of solo physicians or a team of 2 – 5 physicians, and medical practices with 31 – 100 physicians represent 11%. These independent practices represent a major part of the medical providers and manage most of the care delivery system along with hospitals and large medical entities, treating millions of patients every year.

However, these small and medium-sized independent practices are facing financial challenges that started almost a decade ago when the HITECH act triggered technology-based reforms. These physician practices were required to adopt electronic health records (EHR) systems and many other clinical technologies that increased their budget and operational costs.

More than ever, medical practices are concerned about the collections and revenue targets, to keep the business operational. Billing and other financial processes require consistent working of dedicated resources to manage payment claims, payment follow-ups, and physician revenue cycle management healthcare.

What is the revenue cycle?

The revenue cycle is a combination of the front desk and back-office tasks that are linked together like a chain and even a small glitch in the workflow can disrupt the process. This is why unified processes that can bridge the communication gap between the front and back-office resources improve the revenue cycle.     

Every step of a revenue cycle must be taken accurately and an optimized workflow ensures that the provider would meet its revenue targets and is critical for the financial success of a practice. Various factors influence the revenue cycle and optimization which can increase collections.

source:medicaleconomics

Optimized front office processes

If the front office staff fails to register patients properly then the problems start right from the scheduling. It results in missed slots and increased wait time for patients. Similarly, the inability to verify patient insurance information and wrong data entry can mess up the revenue cycle right in the beginning. The front office plays a pivotal role in optimizing the revenue cycle with optimized workflow and pristine handling of the processes.

Physician practices must have an immaculate system of patient call handling and appointments, there must be a scheduling system integrated with the practice management system which can ensure steady patient check-ins.

Patient visits and optimal clinical flow     

After the front office, the most critical phase of a revenue cycle comprises the optimized functioning of patient visits and walkthroughs in the care process. The clinical segment of the revenue cycle is where visit documents are compiled. It is where details of the patient encounter are entered; the physician enters the clinical notes and submits them for further processing.

Errors and omissions at the clinical phase can negatively impact the revenue cycle. Medical billers prepare bills on the bases of clinical notes and completely depend on the information provided by a physician during a patient encounter. Missing information or mismatched medical procedures would result in the wrong preparation of medicals and would lower the chances of reimbursements.

What are the foundations of Revenue Cycle Management?

Revenue cycle management (RCM) is a process that healthcare providers use to manage the financial aspects of patient care. The primary goal of RCM is to optimize revenue generation and cash flow while ensuring that the provider is in compliance with regulatory requirements. The foundations of revenue cycle management include:

Patient Registration: The first step in the RCM process is patient registration. This includes collecting patient demographic information, insurance information, and other pertinent data necessary for billing and reimbursement.

Insurance Verification: After patient registration, the provider must verify the patient’s insurance coverage to determine the patient’s eligibility and benefits for the services provided.

Charge Capture: Charge capture is the process of capturing all charges for services provided. This includes capturing all procedures, supplies, and other services that are billable.

Coding and Documentation: Accurate and complete coding and documentation are essential to ensure that the provider is reimbursed correctly for services rendered. This includes assigning the appropriate codes for diagnosis and treatment and ensuring that all necessary documentation is included in the medical record.

Claims Submission: Once charges have been captured and coded, the provider must submit a claim to the patient’s insurance company or other payers for reimbursement.

Payment Posting: After the claim has been processed, the provider must post payments received from insurance companies, patients, and other payers.

Denial Management: Denial management is the process of identifying and resolving claim denials. This includes determining the reason for the denial and taking appropriate action to resubmit the claim or appeal the denial.

Reporting and Analysis: Reporting and analysis are critical to understanding the financial health of the provider’s organization. Providers must regularly review financial reports and analyze data to identify trends and areas for improvement in the RCM process.

In short, a successful RCM for physician practices requires efficient and effective management of all aspects of the revenue cycle, from patient registration to payment posting, denial management, and reporting and analysis.

Role of medical billing in revenue cycle management

The billing phase represents the most important part of a physician’s revenue cycle. Billing problems, such as entering the wrong CPT codes which are mismatched with the diagnosis, errors in ICD codes, faults in the patient demographics and patient health information, and absence of insurance verification, lead to a shattered revenue cycle. Billing is critical for successfully completing the revenue cycle, and the billers must be trained to code and accurately prepare bills, crosscheck and verify the information, co-pay collection and claim to scrub, prepare the EOB, and post payments.

However, it does not complete here and moves on to the phase where claims are submitted for reimbursements, payment follow-ups, claim denial management, account receivables, and compiling the patient statements. Optimization and management of the revenue cycle demand consistent attention of physician practices and when most of them already complain of burnout and draining of energies due to their indulgence in administrative tasks. This is why a majority of physician practices outsource the billing and revenue cycle management healthcare to teams that can help them achieve their revenue targets. RCM vendors are specialized in managing the revenue cycle of physician practices and with their knowledge and expertise make the revenue collection process smooth.

Conclusion

The Healthcare management cycle keeps evolving and the up-gradation in the physician revenue management cycle keeps occurring due to the fluctuation in the patients’ visits. These fluctuations also occur due to value-based service provisions, global pandemics, and technological advancements. Therefore, the day needs to manage physician revenue cycle management to provide efficient care and receive enough reimbursements.