Revenue Cycle Management Workflow (RCM) is the backbone of the healthcare industry. It manages the finances of the providers and keeps them going on a daily basis. Revenue cycle management (RCM) is the backbone of the healthcare industry. It manages the finances of the providers and keeps them going on a daily basis.
What Is Healthcare Revenue Cycle Management?
While hospitals, small practices, and larger healthcare systems are known for saving lives and treating patients, every healthcare organization needs to develop successful processes and policies for staying financially healthy. That is where healthcare revenue cycle management comes in.
Healthcare Revenue Cycle Management (RCM) is the complete process of all administrative and financial activities that starts from the Patient schedules an appointment with the provider and ends when the healthcare provider accepts all payments. It is the process that manages claims processing, payment, and revenue generation.
Without this key financial process, healthcare organizations cannot keep their doors open to treat patients. Healthcare revenue cycle management is the strategy that healthcare organizations use to pay the bills.
This process of revenue cycle can be managed at the provider office or it can be outsourced to a third party. Let’s understand about both the methods.
RCM Software or A Medical Billing Outsourcing Company
The first step in claims management is to decide whether to install RCM software in-house. Or, do you handover the task to a revenue cycle management company.
How big is your medical organization? If you are fairly limited in scope and have a good IT team in place as well as team members who are well versed in using dedicated software for medical billing, you may prefer to install RCM software on your own servers.
However, if you run a larger organization, such as one with satellite offices, the best approach might be to outsource the RCM process to third party experts. Practices with limited staff expertise in RCM will also find it beneficial to rely on outsiders for this task, so they can focus on their core capabilities in inpatient treatment.
To search for a billing company that fits your practice, physicians usually search for the phrase “medical billing companies near me” in Google. It gives you the list of companies close by.
Here is what’s involved in Revenue Cycle Management Workflow
1 Patient Pre-Authorization
The next step in RCM is the pre-authorization of each patient. Pre-authorization is defined by the decision by a health insurer or plan that prescription medication, procedure, service, or equipment is medically necessary. The exception to pre-authorization would be in cases of a medical emergency.
Pre-authorization doesn’t necessarily mean that the health insurer will cover its cost, which is why the process is repetitive and needs continuous verification. It is always a good idea to double-check any doubts related to coverage with the insurance company. This goes for both the providers and the patients.
2 Eligibility & Benefits Verification
Some of the front office staff have to do with checking on eligibility and benefits for patients. When done over the phone, it can be a grueling and time-consuming process that saps employee morale. Artificial Intelligence could play a pioneering role in this phase of recognition, as it will automate the function.
Modern medical office software will include automatic checking of patient eligibility via the Internet over secure channels, meaning that using dedicated RCM software can speed up the work involved in verifying a patient is entitled to a particular benefit.
3 Charge and Code
When the patient checks in at the office, the visit transforms into a set of codes. There is a high probability of human error in these codes, which is why professional medical coders are the go-to people for it. The codes have to follow a certain set of rules and concur with the CPT guidelines and the latest ICD-10 coding system.
4 Claims Submission
Submission of claims is the vital stage in the overall process because the reimbursement directly depends on it. Payment will not be forthcoming until your office properly submits claims for the work you do for your patients.
As soon as the biller prepares the claims, they are filed with the insurance companies via a clearinghouse. The clearinghouse makes sure they are clean and free from errors. Since human error is always a factor to contend with in submitting claims, you’ll want to deploy PM software that includes an option to detect mistakes and then explain them to you so you can fix the problem. Then you can immediately resubmit the claim.
5 Reimbursement for the Services Rendered
It is time for the insurance company to pay up. After the claim is successfully submitted and reviewed, the payment is posted and is able to be paid by your patient. RCM software can help in this respect not only in the convenience it offers for generating billing statements.
6 Denial Management
In the case of erroneous claims, incomplete patient information, or any other issues, the denials are inevitable. Most low-dollar claims tend to pile up unless the RCM is playing to its full potential.
If your quarterly reports are showing a downturn in revenue because of too many denied claims, it’s time to investigate the matter. Properly executed denial management will boost earnings if money has lately been slow because of problematic claims.
When there is reduced reimbursement from the payers, it means the health plan does not cover all the services. Thereupon, it is the duty of the billers to send those outstanding payments to the patient(s) and follow-up. Medical billing services do rigorous follow-ups until the patients finally pay up.
With all the above steps in place, it helps to streamline the complex process of revenue cycle management. Physicians need a proper team of individuals to carry the process towards the finish line by the successful execution of these stages.
Revenue cycle management workflow or RCM is a complicated process that you need to be familiar with in order to run your practice successfully. Now that you have a good overview of the steps in the healthcare revenue cycle management process, you’ll need to apply what you know toward improving the flow of money at your practice.
The more knowledge you have, the greater insight you can gain into billing and getting paid in a timely manner.
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