What is Revenue Cycle Management?
Revenue cycle management (RCM) is a process whereby clinical management systems interact with medical billing systems which in turn exchange information between clearinghouses, patient statement systems, and patient payment vendors in order to complete a financial transaction between patients, providers and payers.
Currently the RCM workflow consists of 8 medical billing cycle steps:
- Step 1: Eligibility Check and Demographic Verification – ensuring patients have valid insurance coverage prior to scheduling an appointment.
- Step 2: Collection of Co-pay/Balance – collecting a fixed amount from a patient at time of service, as well as the amount owed from a prior visit that wasn’t covered by a patient’s insurance.
- Step 3: Claim Creation, Validation and Submission – creating claims either manually or electronically, and submitting them to either the insurance provider, a clearinghouse or other claims vendor.
- Step 4: Correcting Errors/Denials – determining if a claim simply needs to be corrected and resubmitted or if additional documentation is required. Some insurance providers also have a specific appeal process, deadlines or timely filing limit you must meet to be successfully reconsidered.
- Step 5: Claim Follow-up – following up with the payer via phone, email, letter or online. When done correctly, following up can substantially reduce days in A/R and ease unnecessary financial burden on patients.
- Step 6: Statement to Patient – sending the final costs to a patient as a printed or electronic bill including demographic details, the amount owed, date of the procedure, and transaction descriptions.
- Step 7: Collecting Payment from Patient – mobile and online payments are two methods used today to simplify patient collections. It’s also important to consider the needs of your staff to fulfill basic requirements like automatic posting and reconciliation.
- Step 8: Analytics/Data Analysis – processing and aggregating data into meaningful insights to improve business operations in the form of increased collections, reduced days in A/R, and stable financial performance.
Key Issues and Steps for Improving Medical Billing in Revenue Cycle Management
1. Siloed Steps in Your Revenue Cycle Process – Around 69% of organizations use multiple vendors for their RCM process in healthcare. In the confusion of managing multiple vendors, some organizations overlook duplicate features available in their current software.
How to Improve – Spend some time auditing your current RCM services. Look for opportunities to integrate systems so your clinical experience speaks to your billing management software, which in turn speaks to your clearinghouse, patient payment system, and statement vendor. Connecting patient EHR, billing information, clearinghouse, patient payment portal, and statement vendor can help you reclaim lost revenue.
2. Backed Up Workflow During Admission, and After a Patient’s Visit – time consuming paperwork and manual processes are one of the largest contributors to inefficient claims management.
How to Improve – switch from paper to electronic statements (e-statements) while still giving patients who prefer paper statements the option to receive one. Just make sure that you’re only sending the number of paper statements necessary to receive payment from patients
3. Denied and Rejected Claims Management – 22% of medical claims are rejected, and 65% are never resubmitted. Common causes include incorrect coding, eligibility failures, and missed deadlines.
How to Improve – a three-pronged approach: Optimize processes for insurance verification and eligibility. Train your staff on crucial conversations regarding patient payment obligations and payment options. Transition to better IT software to reduce unnecessary delays between claim filing and patient billing.
4. Adapting to Changes in ICD Codes – There are five-times the number of medical diagnosis codes in ICD-10 as there were in ICD-9. Traditionally adapting to changes in ICD codes relied almost entirely on continual training, resulting in staff turnaround and additional overhead. Challenges will increase with value-based requirements for more robust clinical documentation.
How to Improve – automated coding and machine learning software can learn from past diagnoses codes compared to their rate of successful claim submissions, and then auto-populate new claims with the same information ensuring a higher success rate in a fraction of the time.
5. Revenue Data Loss, and a Lack of Healthcare Analytics – Measuring outcomes is interesting, but not always actionable for improving productivity in your revenue cycle process.
How to Improve – business intelligence in the form of roll-up reporting, real-time data processing, and intelligible dashboards. For example, it’s great to know your percentage of clean claims. But it’s even better to know your top sources of denied claims. One metric shows you how well your company has performed in the past. The other metric shows you how your company could perform better in the future.
GreenSense Billing Inc. has proven history of managing our clients Revenue Cycle Management services through state of art software. Our happy clients are busy treating patients as we work diligently to meet all their needs i.e. clearinghouses, patient statement systems, and patient payment vendors in order to complete a financial transaction between patients, providers and payers.