Revenue cycle management is the process by which healthcare providers and organizations manage and track the financial aspects of patient care, from initial patient encounter through final payment and collection. This includes scheduling appointments, verifying insurance coverage, submitting claims to payers, and following up on denied claims. Revenue cycle management aims to ensure that healthcare providers are adequately reimbursed for their services and to minimize the amount of lost revenue due to denied claims or other issues.
Did You Know
According to a Black Book Market Research study, nearly 80% of healthcare providers outsource at least one aspect of their RCM process.
Why is the Revenue Cycle Important for Hospitals?
In a hospital setting, revenue cycle management is critical to the organization’s financial health. It ensures that the hospital is adequately reimbursed for its patients’ care and maximizes the revenue generated from patient care. Some specific ways revenue cycle management contributes to a hospital’s financial health include:
Verifying patient insurance coverage: Before a patient is seen, the hospital’s revenue cycle management team will typically check to see if the patient’s insurance will cover the cost of the visit. This helps to avoid billing patients for services not covered by their insurance.
Submitting claims to payers: After a patient is seen, the revenue cycle management team will submit claims to the patient’s insurance company or other payers to request reimbursement for the services provided. This is a critical step in ensuring that the hospital is adequately reimbursed for its care.
Following up on denied claims: Unfortunately, payers will deny some claims. The revenue cycle management team will follow up on denied claims to resolve the issue and approve the claim.
Managing patient billing: The revenue cycle management team will also be responsible for managing the patient billing process, including sending bills to patients, collecting payments, and working with patients to resolve any billing issues.
Did you know
A study by Accenture found that outsourcing RCM can lead to an average cost savings of 6-8% for healthcare providers.
What Do Revenue Cycle Outsourcing Companies Do?
Revenue cycle outsourcing companies provide a range of services to help healthcare providers and organizations manage the financial aspects of their business. RCM companies typically offer the following services:
Billing and claims management: RCM companies help to submit claims to insurance companies and follow up on denied claims. They can also handle patient billing and collections.
Coding and documentation: RCM companies can help to ensure that coding and documentation are accurate and compliant with regulations. This can reduce the risk of denied claims.
Data analytics: RCM companies use data analytics to identify trends and patterns in the RCM process. This helps identify areas where improvements can be made and to track the effectiveness of changes made to the RCM process.
Denials management: RCM companies can help identify and resolve issues impacting revenue, such as denied claims or underpayments.
Compliance: RCM companies have the necessary knowledge and experience to keep healthcare providers in compliance with the ever-changing healthcare regulations and guidelines.
Accounts Receivable Management: RCM companies can assist in tracking and collecting payments from insurance companies, patients, and other payers.
Financial reporting: RCM companies can provide financial reporting and analysis to help healthcare providers understand their financial performance and identify areas where improvements can be made.
Overall, RCM companies provide a wide range of services that help healthcare providers manage the financial aspects of their business, including billing and claims management, coding and documentation, data analytics, denials management, compliance, accounts receivable management, and financial reporting.
Did You Know
A report by Markets and Markets says the global RCM outsourcing market is expected to grow at a compound annual growth rate of 10.3% between 2020 and 2025.
How do Revenue Cycle Outsourcing Companies Streamline RCM
There are several ways that outsourcing vendors can streamline revenue cycle management (RCM) for healthcare providers and organizations:
Automation: Many outsourcing vendors use specialized software and technology to automate many of the tasks associated with RCM, such as claims submission and follow-up on denied claims. This helps to increase efficiency and reduce the potential for errors.
Standardization: Outsourcing vendors can help to standardize the RCM process across different departments and locations within a healthcare organization. This can help to improve communication and coordination and reduce inefficiencies.
Data analytics: Many outsourcing vendors use data analytics to identify trends and patterns in the RCM process. This can help to identify areas where improvements can be made and to track the effectiveness of changes made to the RCM process.
Specialization: Outsourcing vendors typically have specialized staff who are experienced in the nuances of RCM. They can help to identify and resolve issues that may be impacting revenue and help to improve financial performance.
Compliance: Outsourcing vendors have the necessary knowledge and experience to keep healthcare providers in compliance with the ever-changing healthcare regulations and guidelines. They can help to ensure that claims are submitted correctly and on time, which can help to reduce the risk of denied claims.
Scalability: Outsourcing vendors can help healthcare providers to scale up or down their RCM services as needed without having to maintain a large in-house team. This can help providers to adapt to the changing business environment and volume of patients and services.
Overall, outsourcing vendors can streamline RCM management by automating many of the tasks associated with RCM, standardizing the process, using data analytics to identify areas for improvement, providing specialized expertise, and ensuring compliance and scalability.
Did You Know
According to a survey by the Healthcare Intelligence Network, 85% of healthcare providers that have outsourced their RCM services reported improved financial performance.
How To Choose Amongst the Top Revenue Cycle Outsourcing Companies
There are several qualities that a top revenue cycle management (RCM) company will have. Some common traits of top revenue cycle outsourcing companies are
Experience: A good RCM vendor should have experience working with healthcare providers and a deep understanding of the RCM process, including the nuances of different specialties and payers. Therefore, count on experience as the first prerequisite while choosing a vendor.
Technology: A reliable RCM vendor should have access to and proficiently use the latest technology and software to automate and streamline the RCM process. Look for the kind of technology a prospective RCM vendor uses.
Compliance: A reputed RCM vendor should deeply understand the ever-changing healthcare regulations and guidelines and ensure that all claims are submitted correctly and on time to reduce the risk of denied claims. Have a deep look at the compliance process of the vendor.
Data analytics: In a competitive world, data analytics should be of primary importance. A good RCM vendor should be able to analyze data and identify trends and patterns in the RCM process to help identify areas where improvements can be made.
Other qualities to look for are scalability, customer service, and cost-effectiveness—a vendor with a dedicated customer service team that can answer questions and resolve issues promptly. Likewise, a scalable RCM partner will help you to scale up or down their services as needed and adapt to the changing business environment and volume of patients and services. Further, if your vendor is cost-effective, you can save money, increase revenue and improve your overall financial performance.
Conclusion
Finding a robust and reliable partner for RCM can be challenging and precise, as it involves much due diligence. Unfortunately, most RCM companies claiming to be experts are spurious entities. This makes it difficult to separate the wheat from the chaff. Often, practices fall for their false claims and hire the wrong provider. The outcome has always been disastrous. Therefore, healthcare practices must make much effort to identify the right provider.
Medbilling Experts has over 12 years of experience in RCM management. We have assisted several large and small practices in stabilizing their revenue cycle management process. Our expertise will help you cut through the clutter. Get in touch with our experts now to know more about our services.
