RCM is the lifeline of any healthcare organization. It includes every aspect of processing patient accounts, ranging from scheduling a patient for an appointment to when a provider receives payment in full for services performed. An Optimized RCM Cycle in Medical Billing is Important for Healthcare Providers to Maintain a Steady Cash Flow and profitability of Practice.
In this blog, we will discuss the RCM cycle in medical billing, while also covering about how Synergy HCLS a pioneer in medical billing solutions enables healthcare providers with an easy, effective and efficient medical billing process to ease up their revenue and reduce administrative burden.
What is the Revenue Cycle Management (RCM) Cycle in medical billing?
RCM is short for Revenue Cycle Management → the entire journey from the patient encounter to the collection of revenue. However, this includes claims management, payment processing, and follow-ups on denied or unpaid claims. RCM Cycle indisputably initiates when a patient books a medical service and finishes upon the provider receiving the complete payment for all claims associated with that service.
At its core, the main objective of RCM is to get paid in full and on time for the services you perform as a healthcare provider. The absence of an RCM cycle can lead to payment delays, more denials, or reduced revenue, all of which can compromise the operational and financial wellbeing of the practice.
Key Steps in the RCM Cycle in Medical Billing
The RCM Cycle in Medical Billing is composed of several key steps that work together to ensure that billing and payment processes run smoothly. Below is an in-depth look at each stage of the cycle:
1. Registration and Scheduling of the Patient
The RCM Cycle in Medical Billing is initiated when a patient has yet to enter the clinic. When patients make an appointment, insurance information, demographics, and medical histories are gathered. All of this data helps to confirm insurance eligibility and benefits, allowing the practice to understand which services will be covered by the payer and which the patient may be responsible for.
Claim Denial — Proper patient registration decreases the possibility of claim denials later in the process. Here, if you provide incorrect or incomplete information, it will lead to billing issues — delayed or denied payments.
2. Eligibility Checkers
After we gather the patient’s information, the second service is to check the coverage for their insurance. This is one of the most vital steps in the cycle of RCM. What is Insurance Verification:It is to check that the patient receiving the services have their insurance plan that’ll cover that specific service. Not only does this step figure out a patient’s financial responsibility for co-pays, deductibles, and out-of-pocket expenses, but it gets this information ahead of time so the practice can take the necessary steps to collect that payment before they even walk into the office.
Not verifying patient insurance eligibility makes claims more likely to be denied, payments to be rejected, and/or a surprise bill to the patient in the end. Doing this will simplify the process and prevent excessive confusion during the procedure between the patient and healthcare providers.
3. Medical Coding and Charge Capture
Once the patient has been treated, the healthcare professional will record the services provided. Afterwards this documentation is converted to standard codes — CPT (Current Procedural Terminology) and ICD-10 (International Classification of Diseases). An important part of the RCM cycle, medical coding plays a critical role since correct coding ensures that claims are timely billed and eventually reimbursed by insurance payers.
Charge capture, also known as charge capture and charge entry refers to registration of the proper charges for services rendered. If the practice is undercoding services, this could result in lost revenue for the practice. Denials of claims or a complete legal penalty for fraud however, could be the consequence of overcoding instead. Avoiding these problems hinges on accurate coding and charge capture.
4. Claims Submission
After Coder coded the services, the very next step in the RCM cycle is to submit the claim to the insurance company. Timely and accurate submission of claims ensures smooth payment. In this step, claims are transmitted to payers electronically and are scrubbed for regulatory and payer-specific compliance.
This means that mistakes in coding or documentation at this stage can lead to claim denials or rejections that can delay payment. Timely claims submission is crucial to maintaining the advance of the revenue cycle.
5. Payment Posting
After payment for a claim submission is approved, the payment is posted to the bank account of the healthcare intermediary or provider. Payment posting means, to record the payment as well as reconciles against the claim. This process gives you a clear insight into what has been paid and what remains unpaid.
Payment posting also helps detect incorrect billing and incorrect charge amount. Shortfalls are often the result of denied services, underuri19 payments, or inaccuracies in the claims submission process.
6. Denial Management
Even with a collective team effort, claims will still get denied or underpaid. Denial management involves the identification, correction, and resubmission of denied claims. Without this step, lost revenue cannot be recovered, and providers will not be compensated for the services they performed.
Behind each denial is a reason — coding error, missing documentation or sometimes, a payer issue. Therefore, proper denial management needs a focused approach in understanding the root cause of each type of denial. Prompt resubmission of corrected claims minimizes payment delays.
7. Handling Patient Billing & Collections
The patient also gets billed for the balance if the insurance does not covers the entire expense. Billing patients involves invoicing and then reaching out to patients and requesting them to pay for the services they availed. We know that the majority of the process of patient billing is crucial to achieving reduced bad debt and patient billing and ensuring the practice stays in healthy cash flow territory during all ever-shifting economic climate scenarios.
Clearly communicating with your patients about their financial responsibilities can help alleviate the confusion from patient collections, one of the tougher aspects of the RCM cycle.
8. Reporting and Analytics
Lastly, the RCM cycle includes a process of consistent monitoring of financial performance through reports and analytics. The reports provide insight to healthcare providers by tracking metrics like claims approval, accounts receivable days and denial rates. By pinpointing trends or bottlenecks in the billing process, providers can fix problems in their RCM cycle, leading to improved cash flow and decreased administrative burden.
The Role of Synergy HCLS in Optimizing the RCM Cycle in Medical Billing
As a pioneer in the field of medical billing and RCM services, Synergy HCLS provides end-to-end revenue cycle management services and solutions enabling healthcare providers to enhance financial performance. In case you are wondering how Synergy HCLS empowers each step of the RCM cycle, here it is:
1. Exact Patient Enrollment and Provider Insurance Confirmation
At the same time, Synergy HCLS confirms that patient information is captured correctly when registering a patient and all information is correct. They verify insurance for your team so the chances of a claim being denied are reduced and the providers know exactly how much the payer will pay.
2. Medical Coding and Charge Capture By Professionals
Synergy HCLS has a team of certified coders and ensures that all services are codified correctly as per the latest CPT, ICD-10 and HCPCS. This introduces them to fewer coding errors which ultimately results in claims being accepted without delays.
3. Efficient Claims Submission and Payment Posting
Synergy HCLS handles the complete claims submission process and ensures that submissions are timely and error-free. They also perform payment posting, which reconciles payments with claims allowing providers to receive full payment for the services rendered.
4. Proactive Denial Management
With smart denial management, Synergy HCLS helps you analyze the reasons for denied claims and tackles them in real-time. This ensures claims are sent back out with the right information the first time, receiving the maximum revenue possible without delays in payment.
5. Comprehensive Reporting and Analytics
Synergy HCLS: Provides the healthcare providers with in-depth financial reports and analytics that helps healthcare providers check the performance of their revenue cycle. These analytics help providers benchmark their performance to gain insights on where they can improve and to make data-driven decisions regarding options to optimize financial performance.
Conclusion
RCM Cycle in Medical Billing is the basis of financial health for any healthcare practice. Every step has to be methodically managed from patient registration and coding to claims submission and denial management to have payments in time, and the right way.
Synergy HCLS provides end-to-end RCM solutions that mainly focus on billing process optimization. Synergy HCLS today announced the launch of its healthcare revenue cycle management services, which ultimately help healthcare providers reduce administrative burdens, claims denial and experience a stable revenue flow – enabling them to concentrate on the need of the hour – quality patient care.
Synergy HCLS is the expert, technology, and support partner that healthcare practices can rely on to take their revenue cycle to the next level!
