Key Tips for Successfully Managing and Optimizing Your Revenue Cycle
Healthcare systems, hospitals, and small private practices dutifully serve our communities day in and day out, and oftentimes, these organizations also lack beneficial resources that help drive their sustainability, success, and financial health. To be successful, organizations must properly manage their revenue cycles by developing processes and policies for establishing, meeting, and managing financial health. Understanding revenue cycle management and how it addresses the complexities of today’s healthcare industry is essential.
What Is Revenue Cycle Management?
A starting point for healthcare companies is understanding healthcare revenue cycle management and how it works. This cycle begins the moment a patient makes an appointment to obtain healthcare services and continues through all aspects of care for that patient–ending when all funds are collected from the patient, insurers, and other sources to cover the costs of that care. Although it appears simple and straightforward, it is rarely that easy.
A highly critical step in the process of streamlining revenue cycle management involves the creation of accounts for the patient so that medical histories and insurance information can be collected and verified early on.
Once this information is on hand, organizations can then:
- Enter the correct insurance information into the system
- Verify the demographics of the patient
- Determine coverage allowances
- Collect upfront patient responsibility
- Process claims and avoid denials
Once the healthcare provider meets with the patient and provides care, the claims submission process is started, and ultimately, the charges are collected from responsible providers. An appropriate ICD-10 code must be used that matches the patient’s health plan. This leads to billable fees. The revenue cycle management system does not stop at just sending the bill. It must continue until the costs are paid for, which includes the payment posting, a statement processing step, payment collections when needed, and in some situations, claim denials.
This system is complex and leads to numerous obstacles for organizations when it is not done well.
Challenges of Revenue Cycle Management
The challenge in the revenue cycle begins early on – right at the point when a patient makes an appointment. Common problems with the process include the following:
- Inaccurate coding, often due to human error when inputting information
- Miscommunication between provider, patient, and health care plan
- Medical billing errors due to improperly or duplicate data entered
- Missing information for processing claims
- Misspellings in names or other information that can lead to denials
- Lack of pre-authorization
- Compliance risks that hamper the communication process
When mistakes happen throughout this process, delays across the health system are incurred. These delays can slow down and critically impact cash flow-–limiting the practice’s ability to pay employees and meet other financial obligations.
What Affects Revenue Cycle Management?
Often one of the biggest challenges is tackling a provider’s belief that they have little control over the claim review and denial process to include long periods of waiting for claim processing, delays in provider payments as a result, and eligibility issues.
Important to note, there are factors impacting revenue cycle management that can be controlled. Examples of those include:
Successful Payment Collection
Many health plans require patients to cover some of their costs. Ideally, these are communicated to the patient and processed prior to providing care, reducing the risk of nonpayment. The best way to overcome this challenge is through proper pre-registration, which ensures accurate information is obtained and communicated to the patient about their financial requirements. The more information available and communicated to the patient – coverage available, number of maximum allowable visits, additional insurance, etc. – the less likely there will be obstacles.
Limited digital workflow
Another factor comes from a lack of digital workflow, and the reliance on manual data entry. With a reliable IT infrastructure, healthcare organizations minimize the risks of simple mistakes and save time through the elimination of unnecessary reporting. They also gain additional information and support from the electronic workflow process, improving communication, and limiting the risk that paper documentation is lost.
Often, patients who need medical care are less educated on what type of care they are eligible to receive under their health insurance plan. A patient’s health insurance plan is often brimming with details outlining the care they are eligible to receive. It is easy for patients to become overwhelmed or even confused when attempting to navigate this information, but it then becomes the provider’s responsibility to communicate eligibility to the insurance company to eliminate common mistakes.
No oversight in the tracking of claims can lead to denials or situations where claims are not received by the payer.
Poorly managed administrative processes
Another concern that affects revenue cycles is a broken administrative process. A core component to improving this situation is accurate communication at every stage –
- Improve communication during patient intake
- Determine and communicate coverage eligibility early on
- Improve claims reimbursement information
- Streamline payment collections
Both the front and the back of the administrative process need to align with the same goals of streamlining operations and educating patients. This often includes the need to revalidate patient information prior to additional visits and to communicate concerns with each member of the team.
With the help of improved revenue cycle management, healthcare organizations gain better insight into their claims process, and there is a significant improvement in the financial health of the organization.
Benefits of Smart Revenue Cycle Management
The investment into revenue cycle management software makes a significant difference in the outcomes for patients and improves the overall financial health of the company. No matter if the practice outsources all revenue cycle management or puts in place a software program to manage it in-house, this type of tool can enhance the outcome of every patient contact.
When a system is put in place that is specifically designed for healthcare and the type of practice, some outstanding benefits are likely to occur.
- Time savings: Administrative team members have more time and can better assist patients throughout the entire process because many of the tasks are automated–including payment management and appointment booking. It can help to streamline payment reminders, claims management, and connect with insurers.
- Insights: When a claim is denied – which slows down the revenue cycle – finding out why is the critical first step so the concern can be alleviated. With a revenue cycle management system in place, it is possible to do this sooner and more efficiently.
Accuracy: The use of these systems enables better accuracy when inputting data. This can help minimize any claims revisions and denials associated with the patient’s care.
- Insurance status: The system can also work to verify the patient’s insurance. By doing this at the start and establishing payment for care upfront, companies can often minimize delays and nonpayment.
- Pinpointing revenue shortfalls: Depending on the type of software solution, some programs can provide insight into revenue shortfalls faster, meaning providers can take action sooner to better align their finances.
All of this is possible because the revenue cycle management solution is designed to accommodate the unique needs of the healthcare practice–providing a way for organizations to see where claims are throughout the process. It eliminates the risk of information being lost or claim denials being overlooked while also reducing the risk that a person will make an error that stops the entire process.
Overall, benefits of revenue cycle management include the following:
- Improving financial collections
- Managing denials faster and more efficiently
- Support for claim scrubbing and coding assistance
- Increasing patient awareness
- Ensuring fewer mistakes
Beyond a doubt, the investment in revenue cycle management improves operations for healthcare practices. This ultimately leads to better management of financials, more money for employees and profit, and better reinvestment into the company. It can also alleviate partner frustrations and ensure each party is working towards the same goals.
Revenue Cycle Management Tips
For organizations ready to find a better solution and enhance their current operations by taking advantage of modern trends in healthcare revenue cycle management, there are a few tips and strategies to keep in mind.
Create a process to mitigate risks
Many organizations spend a lot of time and money handling these problems. That is, they focus on managing denials of claims or delays rather than creating a system that prevents these common problems. Improving communications with patients, better insurance verification strategies, and ensuring a streamlined process is in place to set up new patients can help create a process to mitigate risks.
Identify eligibility issues early on
It is easier to manage eligibility problems early on, prior to the actual claims process. This can help to avoid initial claim rejection. To do this, organizations need to be proactive about having revenue cycle management software in place that is designed to ensure eligibility is completed quickly.
Automation resolves common problems
For many organizations, the more automation incorporated into the practice, the better. This means that information is automatically pulled from available documentation instead of being manually inputted by a person, which increases the risk of human error.
Ensure claim review occurs
Some of the best revenue cycle management software programs help to alleviate some of the most common claims concerns – denials. By allowing the software program to review and ensure that coding is properly completed and that every step in the process is done, it’s possible to eliminate many of the most common reasons for denial. Software experts can help to identify and then fix errors before they go to the insurer, which can prevent long delays.
Find an audit tool
An often misunderstood component of the revenue cycle is the management of audits. It is not uncommon for an audit like this to be unnerving, yet with careful management through a software program that can facilitate the process, it does not have to slow down the organization. Look for a solution that can simplify the process of responding to any type of audit request, including from the Centers for Medicare & Medicaid Services. This minimizes any negative impact that can occur when there are audits.
Improve patient experience
At the end of the day, the goal of any practice is to meet the healthcare needs of the individual. Patient experience can easily become muddled in this process. Some of the best solutions offer ways to streamline the patient experience–ensuring more accurate account creations and pre-registrations, better patient insight into care, and improved overall communications for all parties.
Streamline collections processes
Inevitably, there will be patients that fail to make payments, or some claims may be denied for various reasons. When this happens, it impacts the organization’s finances. Ensure that the revenue cycle management solution used can comprehensively pinpoint these risks, mitigate them when possible, and track the long-term outcome with improved efficiency.
Software and Technology Can Help
What is revenue cycle management like in your healthcare practice? At Vyne Medical, we offer a comprehensive solution to enhance operations from the first step. Our solutions include every tool you need, including audit management, appeals requests, denials management, and connected care plans. You can also manage referrals, integrate services, and improve workflow optimization. The right revenue cycle metrics enhance operations, support practice growth, and enable successful care of patients.
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