How to Modernize Revenue Cycle Management

Modernize Revenue Cycle Management

Every industry is adapting Modernize. Now its time to Modernize Revenue Cycle Management industry as well.

Before everything, let’s understand the definition of modernization. The business cares about business processes that help to increase revenue, reduce costs, and increase value. Improving current business processes to better support organizational objectives as a result increase revenue, cuts costs, and builds value using new strategies is modernization.

Why modernization is important in healthcare?

The healthcare industry has become more and more complex in recent years. This is due to several reasons, some of them are complicated payer contracts, increased patient financial balances, regulatory demands, etc. As a result, providers have been forced to do changes in their approaches to revenue cycle management.

Despite making changes like hiring new talent or introducing new technology, still, healthcare organizations struggle to convert themselves in high performing organizations.

The revenue cycle is outdated in some ways. Being a business owner, you don’t want these processed to be outdated as it costs money. Now is the time to evaluate your revenue cycle.

Let’s take a look at problem areas and their solutions to the healthcare revenue cycle model.

Problem areas of healthcare revenue cycle

Patient payment is getting converted into bad-debt

Cost-sharing between insurance, providers, and patients has increasingly become a topic of public discussion. In particular, the increasing proportion that enrollees are paying for healthcare has been an area of concern.

For example, in the ten years from 2006 to 2016, average deductibles increased from $303 on average to over $1,200.

Average health plan deductible

With the increase of patient portion on payments, it is getting hard to collect amount from patient end. This results in bad debt for hospitals, healthcare organizations, and patients.

There are technologies available to solve this issue however the healthcare sector has been slow to adopt them.

Consumerism and patient experience

Patients are looking for financial transparency with their healthcare experience like they have with other industries as well, like retail. This is also a valid point since they are paying to get services, so there should be transparency with all the financials.

They want providers to give them estimates ahead of time. When patients have that knowledge, they are quite willing to pay as well.

Practice Management & Financial Software

Every hospital or practitioner has different practice management software and different financial software. So, when payment is submitted in systems, there is no one reconciling that. Which is causing so much chaos with financials.

Implementing new technology-based systems can reduce this problem. Keeping every payment within the same place will help you easily reconcile it, give a clear view on the responsible person for leftover balance, and more.

Unable to understand the insurance contracts

Year after year, more and more insurance companies are establishing. All of them having multiple plans. Lack of knowledge of patient benefit parts is also a cause of bad debt.

Without knowing the patient portion on a plan, health organizations missed collecting patient portion upfront. With the implementation of new and improved software, this can be resolved.

There are some of the problem areas that are affecting due to the out-dated method of healthcare revenue cycle models. But these can be corrected with the implementation of modern techniques of revenue cycle management.

There are a lot more problem areas that are causing problems in healthcare revenue cycle. Instead of discussing more problems, let’s focus on solutions that modernization/technology provides us to get rid of these issues.

Methods to Modernize Revenue Cycle Management

Modern Processes = Simple Processes

Many processes can be simplified and consolidated through IT modernization. For example, cloud-based automation solutions help streamline many of your mundane daily activities that can bog down efficiency.

Online presentation and video conferencing features may eliminate the need to travel frequently. This can improve your quality of life and save time while also saving the business a tremendous amount of money, some of which can be invested in quality team building and professional employee development.

As the industry evolves, provider organizations will need to continue to adjust to attain revenue cycle excellence. A provider’s financial well-being is nearly always tied to the revenue cycle of clinical practice.

Re-envisioning Practice Management Software

There are plenty of software companies in the market which are creating healthcare Softwares these days. Take a look at your current system, if it does not have an automated option to reduce manual work or you are getting difficulty to sync all your records and transactions then it is time to reconsider for new software.

Since so many software options are available in the market, there is a pretty good chance that you will get a best option than your current software at a competitive price.

There are healthcare systems available that can now take a patient payment at the point of care anywhere in the system. The payment experience is exactly the same whether the patient is in a hospital or a medical office. All data from disparate systems is aggregated.

Patients can go to one website, enter their account number or date of birth, see their balances and pay. It’s simple and easy to use.

This is only one of the many features that are available in new modern Softwares.

Implementing automation

A major aspect of any modernization is to automate the repetitive processes. Automating processed will be more accurate and more productive compared to manual ones.

To identify this, look for anything that you touch twice, like verifying patient eligibility by visiting insurance websites or calling insurance every time a patient visit. You should be able to automate it or at least look into automation. There are many Practice Management Systems available which get this done on a click of a button.

Also, anytime you work the same thing, there’s always some variation in it. And to get is sync, human capital is required, which is a precious, expensive resource.

In addition, automation may result in a workforce reduction, which could help you retain top talent and offer them a more competitive salary. There is also the opportunity to repurpose talented team members into other areas of need.

Clear communication with the patient

The next key element of the modern revenue cycle is ample upfront communication with patients about their financial responsibility. This starts with giving patients information about their bills, such as a cost estimate, eligibility, and options to fiscally engage early on. Using a modern Practice Management System will help you to get an estimate of fee schedule before starting the treatment.

Nearly half of the patients said they didn’t pay their bill because they didn’t understand it. Improving engagement with patients about their finances will not only help improve collections but also patient satisfaction.

Engaging them early on not only sets up that payment expectation, but it also shows patients that you care about them.

Using cloud computing to connect data sources

If you are using multiple Softwares to across your hospital or clinic. Like EMR for records, PMS for patient records, EDI for billing claims to insurance, then all these must be synced with one another. Because these sources are unable to integrate with one another, it causes inefficiencies, confusion, lack of transparency with data, and revenue recognition.

Filling the gap between applications, making data shareable is the key to a transparent system. A modern revenue cycle will not only find ways to connect these otherwise disparate sources but interpret the shared data for ultimate understanding by the end-user.

This will increase productivity, reduce costs and errors, and also improve patient satisfaction and experience as well as your provider experiences.

Calculate the performance

Elements of successful performance management include developing a common cultural foundation, creating the tools to measure and manage performance, and making measurable and quantifiable changes.

High-performing organizations ensure a culture of accountability through constant communication, education, and reporting on revenue cycle performance.

Eliminate Overhead and Invest Where it Really Matters

The incorporation of new technologies in business practices is often viewed as an expensive measure. While you will still have to invest a certain amount to obtain access to new solutions, many applications are available at minimal and some even at no cost to you.

For example, having in-house servers mandates that you take care of their security, patching, and uptime. If you can’t, you have to subcontract somebody to do it. In addition, your data is only available onsite. Moving to a cloud solution also moves those responsibilities to the provider you choose. This eliminates some pretty hefty costs. As a bonus, you and your employees will be able to access business-critical data and processes from anywhere. While you may argue that you can integrate a cloud solution to your in-house servers, just think how much it would cost as opposed to choosing a cloud solution provider.

Conclusion

Technology is a proven way for health systems to kill two birds with one stone: improve the patient’s financial experience and strengthen and modernize revenue cycle management.

Let’s summarize the approach to modernize revenue cycle management:

  • Human data interactions that should be automated or simplified
  • Human workflows that should be automated or simplified
  • Organizational hand-offs that should be automated or simplified
  • Automated verification points that mitigate human errors
  • Process steps that evolved as workarounds and should be simplified
  • Data gaps that create inefficiencies
  • Exception causes that burden the cycle and where/how to eliminate them

If you find this helpful or have any other questions on this, you can tell you using our comments section.