Understanding the Problem
Inefficiencies in Revenue Cycle Management (RCM) processes result in losses worth millions of dollars for healthcare practices in the United States every year. The healthcare industry’s fiercely competitive environment and the strict regulatory norms that hospitals and clinics need to adhere to magnify further the problems resulting from RCM inefficiencies.
There is, however, a silver lining to this dark cloud of RCM conundrum. It exists in the form of possibilities and opportunities. There are measures that healthcare practices can adopt to turn the tide in their favor and keep their revenue healthy and well suited to match the demands of a value-based care reimbursement model.
From steps that can reduce errors in filing claims to follow-up processes to create a case for payers to reimburse providers, there are so many things that you can do to improve the efficiency of your RCM process. The road to increasing your RCM process’s efficiency begins with identifying the essentials that can bring about a complete overhaul of your workflows.
This rabbit hole goes deeper than you might think, but focusing on the basics will help you get off to a great start. The most logical approach is to focus on the essentials of a kind and efficient RCM process and what can be done to solve problems in using healthcare IT.
Here‘s What Your Healthcare Practice Needs
A report by Mckinsey on US healthcare payments states that 15% of every US healthcare dollar spent goes towards managing RCM inefficiencies. The inefficiencies can add up to a staggering sum of close to $400 million in total across the United States. Healthcare practices are investing heavily in streamlining their RCM process flow, and the following are their key areas of focus:
Robotic Process Automation, Machine Learning, and Artificial Intelligence are three popular technology trends that advance the possibility of process streamlining and quality enrichment in the RCM process of medical practice. These technologies quickly become the cornerstone of efficient claims management, payment posting, and accounts receivables management processes.
Core aspects of an efficient RCM process such as claims management, payment posting, and AR management can benefit mainly from automation and self-learning systems. These technologies streamline these core financial processes by identifying aging claims, reasons behind claims denials, and promoting patient eligibility checks. These systems can increase the turnaround times of claims filing and the fulfillment of outstanding requests by up to 30%.
Key process points such as accurate payer enrollment and patient insurance benefits verification are vital precautionary steps of a good RCM process. These steps will save you time that is otherwise spent on backtracking to the root cause of a denied claim. Reduction in the rates of claims denials and patient check-in times are two of the most significant benefits that you get from adopting a preventive approach to your RCM process.
Data analytics’s potential to increase the visibility of financial and healthcare trends makes it an essential component of healthcare RCM. Data analytics equips your healthcare practice with KPIs that give you insights on the root cause of denied claims and what can be done to mitigate their adverse effects.
It also doubles up as a means that aids care gives to forecast future business trends, leverage business opportunities, and improve the quality of your care delivery. Advanced iterations of data analytics such as healthcare BI (Business Intelligence) can also help you track healthcare professionals’ performance and claims management specialists, which improves the overall potential of your profitability.
Dedicated AR Management
When healthcare practices allocate dedicated resources to monitoring and tracking outstanding payments, they get a bird’s eye view of the entire process. A dedicated accounts receivables management team takes care of tracking aging claims that require immediate attention. Besides the apparent benefit, such as handling overpayments and root cause analysis, AR management’s dedicated effort ensures that you are not in breach of any regulatory compliance requirements. The combination of faster collection times and compliance adherence makes it essential for a well-rounded healthcare RCM process.
Not many healthcare providers are willing to concede the effectiveness of patient education in streamlining their RCM process. Training your staff to educate your patients goes a long way in avoiding bad debts once the treatment concludes. Provide your patients with estimates of the costs of care so they can receive their bill amount without being caught off guard. This concept of maintaining transparency in cost will increase the likelihood of you receiving prompt payments.
The Real Bottom Line
Every investment that you make to optimize your RCM cycle will fetch you sizable returns in just a matter of a few months. A systemized RCM process is more than capable of increasing collections of revenue by close to 20%. This makes RCM investments a small price to pay for the immense returns that it can deliver.
Without a well-defined RCM strategy, care providers are exposed to the risk of revenue bleed. Denied claims and appeals will continue to pile up till the point where a care facility would be left with no choice but to resort to cost-cutting measures such as shutting specialty care centers, for example.
Managing the claims collection process is always stressful and resource-intensive. Unfortunately, it is vital for the survival of a care facility. After all, healthcare is a business model, and all businesses need to stay profitable to thrive.
While an effective RCM strategy is paramount for a care facility’s functioning, it is an uphill task. Healthcare providers will need the support of HIT vendors who are specialists in the development of software tools designed for RCM processes. They come with all the right sets of tools that provide care providers with a bird’ eye view of their revenue cycle.
They understand the drawbacks of a care provider’s RCM cycle and design an implementation plan to eliminate them. Such a focused approach to dealing with RCM inefficiencies helps care providers improve the quality of care by focusing on what they do best, i.e., keeping the world’s citizens healthy.