The healthcare industry is a big one and for it to function properly there needs to be a proper revenue cycle. Without a proper and functioning revenue cycle, hospitals will not be able to deliver their promise of providing top-notch healthcare services to their patients. In the United States, the use of revenue cycle management is seen in every healthcare organization. The tracking of the revenue right from the initial appointment of the patient until the very end of the reimbursement process is managed with the revenue cycle management services.
The start of the revenue cycle can be marked when a patient schedules an appointment with their doctor. After the patient receives all the services, the hospital then gets reimbursed for the healthcare services it had provided to its patient. This marks the end of the revenue cycle. There are a total of seven steps that are involved in the RCM;
Understanding each step that is involved in revenue cycle management will help you in the long run.
- Outsourcing processing; Depending on the size of your organization decide on the kind of processing you want to go with.
- Pre-authorization of patients; U.S government defines pre-authorization as a resolution that is provided by the health insurer where the procedure, medication, service, or equipment is a medical necessity. Only in emergency medical cases, pre-authorization remains an exception.
- Verification of eligibility; During the process of medical billing, the eligibility for each patient is checked thoroughly. RCM software is programmed to do so in a swift manner that speeds up the process of revenue cycle management.
- Submission of claims; Your medical organization will not get properly reimbursed if the claims are not submitted in a proper manner (without any errors and on time).
- Posting of payment; after the submission and reviewing process is over for the claims, the payment then gets posted which is then paid by the patient. RCM software helps in this regard since it not only makes it convenient to generate the billing statement but also has an overall good collection experience.
- Managing of denials; Denial management programs help in recovering revenue that could have been otherwise lost due to incorrect filing of the claims.
- Reporting; A report that has all kinds of data which includes management information, financial data, key indicators of reaching benchmarks, and many more.
Each of the steps has a definite process that needs to be followed carefully without which the entirety of the revenue cycle can get disrupted which will lead to the rejection of claims and a loss for the hospitals.
Why Do Insurance Claims Get Denied?
Before understanding the factors that can help you in improving the revenue cycle process in healthcare you would have to understand why in the first-place insurance claims get denied. In 2019, the Medical Group Management Association, often abbreviated as MGMA listed a number of reasons which can lead to a denial of the insurance claims in the first place. One of the most important reasons out of all of them is the absence of correct information which includes the diagnostic or procedure codes and demographic data. Some other reasons that could lead to the rejection of claims include not being able to meet the necessary requirements, mistakes while processing the payment from the payer, eligibility problems, benefits integration with the fact that the medical practitioner does not hold a proper license.
The rejection of claims is, therefore, a major problem for many healthcare organizations since they have to bear the burden of the loss alone. The hospitals then have to ensure that the bills get revised and re-submitted later on. If the rejection rate of claims is higher for a medical organization, then it can have an effect on the revenue cycle in healthcare.
How To Improve Revenue Cycle Processes?
Analyzing your revenue cycle processes will help in avoiding all of the claim rejections and also ensure that your medical organization gets compensated properly for all the healthcare services it provides. The lesser number of denials that there are, the better it is for the medical organizations since it increases profitability.
Let’s take a look at the components that help in the improvement of the revenue cycle process.
1. Understanding the current process of your revenue cycle
When you are analyzing the process of billing, it is important to look at its intricacies. The revenue cycle in itself is quite complicated, to begin with. The start of the revenue cycle is from the patient registration process and ends with the reimbursement process. Understanding each step in the revenue cycle process will help you gain insight into the duration of the entire process along with the identification of the opportunities that can aid in the overall improvement.
2. Performance metrics
In order to fully understand Revenue Cycle Management (RCM), grasping the crucial performance metrics of your medical practice is quite important. Once you identify these, consider the days in AR (accounts receivable) along with the rate of net cycling and all the other performance metrics. This further provides you with all the information that can help in the improvement of the revenue cycle process.
3. PStaffing plans
Examining the procedures with the administrative and management team of your medical organization along with establishing the number of people that are needed for every stage of the revenue cycle process along with the time that gets spent is affected by different components such as patient information, specialty, and the required technology. This opportunity can be used otherwise to look at any demands that can become apparent from your new goals.
4. Inquiring about revenue cycle resource
When it comes to the revenue cycle, some technologies must be used to attain proper results. The identification of the resources and materials used for each of the activities is important. Discussing with your management team about the handling of the procedure and the resources that are used is also the key to success.
To stay updated with the healthcare billing development you would have to hire proper revenue cycle management services since they can look into the timely submission of claims along with looking at all the needed solutions. This is where a reliable and experienced service provider like Synergy HCLS can help you out!