While revenue is not the primary focus of most healthcare providers, it is vital to sustaining a healthy medical practice. According to RevCycle Intelligence, billing, coding, and revenue cycle management (RCM) are the top challenges medical facilities face today.
In this blog, we walk through 4 reasons why keeping on top of your Revenue Cycle is essential to maintaining a healthy medical practice.
When Does Revenue Cycle Management Begin?
Most RCM starts before the patient receives any medical care; it typically begins during the patient’s first encounter with your facility. Whether it’s checking in at the front desk of your walk-in clinic, or scheduling an appointment over the phone.
The cycle continues to services rendered, paid bills, and paid claims.
Your healthcare revenue cycle also includes medical coding services and billing out insurance. It should also encompass the eligibility of the patient before the visit as well as any out-of-pocket costs. This step is vital because it determines the cost of the various treatments before the patient walks in the door.
Once the medical services are rendered, the next step of the revenue cycle is to manage any past-due patient accounts or accounts receivable that affect your cash flow during collection times. Note that your revenue cycle often includes managing bad debt and uncollectible patient payments.
Once your patient accounts are up to date, the cycle continues with scheduling the patient’s next visit and sending out reminders on past-due payments.
4 Reasons Revenue Cycle Management Is Important
Effective RCM ensures that, as a provider, you avoid delayed or lost revenue. While the primary goal of RCM is to increase provider revenue, there are additional reasons why RCM is essential to your medical practice. These include:
Identification and Resolution of Errors
Your business can not afford recurring, preventable technical issues, including missing patient chart information or improper coding.
When you implement a strong revenue cycle management plan, you become better equipped to identify errors when they occur within your revenue cycle. You avoid preventable mistakes like those highlighted above. With the proper RCM plan, more claims will be approved on their first submission. With claims passing on the first submission, you and your team don’t have to spend extra finances investigating and appealing denied claims.
Decreased Administrative Burden
A study completed in 2021 found that the administrative burden created by denied claims leads to substantial revenue loss for healthcare providers. Effective RCM helps prevent claim denials, decreasing the administrative burden.
Your administrative staff won’t have to spend time and energy investigating and appealing denied claims. As such, they have more time for patient care.
Often, RCM focuses on front-end tasks, ensuring significant simplification of the interaction between administrative staff and patients. Everything from appointment scheduling, intake form completion, and payment processing are streamlined, translating to a decreased administrative burden.
Avoidance of Healthcare Fraud
On average, healthcare fraud costs the healthcare industry more than $100 billion annually. Fraud encompasses a range of reimbursement issues, including duplicated services and informational issues that cause exaggerated complexity and misrepresented services.
A significant benefit of proper RCM is that it assists in preventing healthcare fraud and abuse. It avoids coding issues, including billing services not rendered, medically unnecessary procedures, and low-quality procedures or tests.
With proper RCM, you should also be able to avoid upcode procedures. Upcoding refers to requesting a higher reimbursement rate for services that might not necessarily merit it.
Overall, your RCM should emphasize accurate data collection, billing, and coding.
The risk of not having proper RCM includes submitting inaccurate information and an increase in claim rejections and denials. With the right revenue cycle manager who can keep you up-to-date with the ever-changing healthcare regulations, you can be more confident in your claims and avoid unintentional fraud.
Increase in Healthcare Facility Revenue
The right RCM helps increase practice collections and revenue. In reality, your healthcare facility will likely have many expenses to account for. You pay upfront for the services you provide to patients, you pay your staff salaries, and you pay for your office. When claims are denied or patients default on payment, it puts strain on your organization.
Successful RCM strategies leverage technology to simplify and streamline payment cycles. This technology enables you to collect payments with little to no impact on how your practice provides care. The simplification and streamlining of the payment cycle decreases the number of errors and redundant processes, reducing the time and resource requirement for the processing and collection of payments.
On average, claim denials have increased by 17% since 2021. Most denials are preventable, especially if your practice proactively addresses each claim. The right RCM can help your practice uncover any underlying patterns of claim denials.
Once you recognize these patterns, it becomes significantly easier to work towards avoiding them in the future.
By identifying errors, decreasing administration costs, avoiding fraud, and eliminating any risk of failed compliance, your practice should be able to improve its revenue cycle. If you and your staff need assistance with RCM, CBS Medical could be your guide.
At CBS, we employ front-end and back-end strategies to ensure fewer claim denials at your practice. We work with your healthcare providers to ensure that patient information is accurate at the point of pre-registration and registration.
We ensure that all rejections are communicated promptly through the rejection reports to ensure timely implementation of corrections and avoid additional claim delays.
Partner With CBS Medical to Enhance Your Revenue Cycle Management
If your RCM team lacks the clinical experience to support appeals or manage clinical denials, our experts step in to provide the needed support and training. Further, if you have a staffing challenge, we help your practice work through the denial backlogs to ensure the timely meeting of deadlines.
At CBS, we are committed to workflow optimization and automation, especially regarding clinical documents. We have invested in analytics and artificial intelligence to ensure that your medical billing stays at par with industry standards. Finally, we help you handle any issues related to the evolving regulatory changes surrounding medical billing. Reach out to our team today, and let’s revolutionize your revenue cycle management.
