A Healthcare Practice’s Revenue Cycle in Seven Steps
Successful healthcare firms rely heavily on Revenue Cycle Management (RCM). If your billing system isn’t up to standard, your clinic might lose a lot of money in numerous day-to-day transactions and other income sources.
All healthcare units use a healthcare revenue cycle to keep track of all medical and administrative data that enters their facility daily. RCM isn’t difficult; however, it is a time-consuming procedure that includes a great deal of information traveling through a facility’s many divisions. That is frequently the justification for why having correct information is so essential for a successful business administration.
All administrative and clinical responsibilities, including gathering, guiding, and monitoring detailed service information, are essential to the RCM process. As a result, it encompasses everything, including patient pre-registration through invoice payment collection.
Understanding and implementing a great Revenue Cycle Management process is critical to your organization’s overall success. A healthcare practice’s revenue cycle steps are outlined below for your facility’s smooth and profitable functioning.
Step #1: Pre-registration
Pre-registration is the first significant phase in the RCM process because it enables the healthcare provider to collect descriptive health coverage and qualifying criteria quickly. The data is then sent to the patient’s health insurer and, after that, is sent through the physician’s practice management system, which informs the provider about the patient’s insurance, deductibles, co-insurance, and, in some cases, if a recommendation is required.
At the time of pre-registration, the clinic might address the patient’s monetary expectations, such as payment terms and cancellation policies. The pre-registration method allows an organization to establish the economic tone from the start and eliminates payment-related concerns. Evaluate your pre-registration procedure today to ensure an excellent start to the RCM process.
Step #2: Registration
From beginning to end, registration ensures the step towards validating the information of the patients is correct. The provider double-checks the patient’s residence, contact details, birth date, sureties, and insurance details upon enrolment, and it’s vital that they keep this data safe every occasion an individual is served.
All of the patient’s medical data collected during the pre-registration phase is validated in the registration stage. If a mistake is discovered in a patient’s completed form, it is raised before the patient so that it doesn’t become a severe problem later on. Inaccuracies in a patient’s paperwork might lead facilities to wait long to collect payment from insurers.
Step #3: Capture of Charges
Charge collection can be accomplished in a variety of manners. It could be computerized, with data flowing into the firm’s management accounting division depending on whatever the provider enters in their paperwork, or it could be performed the traditional manner, with billing employees physically inputting in the data. Both systems have advantages and downsides since there are costs that could be overlooked in any case. Ancillary services are a regular price that is overlooked, resulting in money lost.
Examine your cost capture method if you’re afraid you’re not reporting for all fees. An expert auditor can trace a payment from beginning to end as a component of an RCM audit to find missing costs.
Step #4: Submission of a Claim
The fees, CPT codes, and diagnostic codes should all be examined by the Revenue Cycle Management team. They’ll inquire as to whether the diagnostic supports the procedure. If multiple services are offered, they must be differentiated and categorized appropriately. Scrubbing claims is just the method of verifying that they are fair and ready to be sent out.
In the situation of any errors or other issues with the filing, payment processing will be delayed, and the medical providers will not get the insurance claim. An insurance claim will be paid much quicker if it arrives at the health insurer carrier in good condition.
Step #5: Processing of Remittances
Remittance processing occurs once a firm’s claims have been sent out. The reimbursement explanation tells the organization how much they were compensated for the activities they supplied. Allowable that is a provider’s agreed pricing with a payer is decided throughout this phase.
Fee schedules are another component of remittances. Annually, providers should examine their charge schedules to comply with changing rates, agreements, and allowable. Examine your costs frequently to ensure you’re not wasting money.
Step #6: Follow-Up on Insurance
According to the AMA, one out of every five claims is mismanaged, putting the medical sector with an average accuracy of just 80% in reviewing and settling claims.
That affects the significance of Health coverage follow-ups in properly accepting claims. Rejections, underpayments, and non-payments are among the most likely complications in this process. If the facility is dissatisfied with the compensation, the prices might be adjusted at the very next round of plaintiff talks.
Step #7: Patient Collection
Patient accounts and liabilities are computed, and a report is generated in the final phase of Revenue Cycle Management. Pending amounts are closely monitored. The amounts of numerous patients’ payments are tracked. With the rise of highly deductible health plans, patient groups are becoming much more critical, as they are directly linked to hospital revenues.
Making sure that routine patient reports are being sent out is crucial. A regular statement process is the best practice; the patients will receive one notification every thirty days, but reports will be sent out more often, helping businesses to push their revenue cycle along more rapidly and increase their cash flow. Tidying up one’s patient collections can help them avoid hiring a medical bill collector.
RCM is a sophisticated process that one must understand to manage their practice successfully and efficiently. In Revenue Cycle Management, there really are seven key steps that firms must follow with the help of a professional or by doing it alone with their own software application. In a hospital setting, managing RCM commences with patient pre-registration since one cannot provide treatments without taking proper care of such a critical responsibility.
Organizations may avoid billing concerns by establishing a plan to verify qualification and compensation after offering services constantly. It’s advisable to report claims through a scheme that incorporates a rejected claims manager because then you can instantly correct mistakes and get paid sooner.
Also read: Hiring A Reliable Medical Billing Company Improves Your Business Growth – Here’s How