Revenue Cycle management is the process of managing claims for medical billing companies. The conventional approach to financial management of a business treats its various functions and processes like marketing, sales, billing etc. as separate activities to be managed independently. With reference to healthcare institutions, such an approach results in administrative tasks like setting up appointments, sending reminders, determination of charges, submission of claims, or follow up being treated as relatively unimportant with reference to the organization’s revenue cycle.
A person can be healthy only when all the organs in the body function properly in a coordinated manner. Similarly, effective revenue management in a hospital is possible only if all functions—administrative as well as clinical—that affect revenue are managed in an efficient and holistic manner.
Improper claim submission or lack of follow up will impact the hospital’s revenue management despite having an excellent track record in providing quality clinical care. Simply put, no function or process can be treated as unimportant as far as revenue cycle management (RCM) is concerned.
Advantages of Outsourcing RCM
Consulting a specialist is always recommended for diagnosing and treating complicated ailments. Similarly, handling administrative tasks related to medical billing and claims can be done a lot more efficiently if outsourced to an organization offering specialized RCM services.
Efficiency—this is the key to maximizing revenue and boosting profits. A recent Black Book RCM vendor client experience poll found that more than 70% of Chief Financial Officers of hospitals found RCM outsourcing to the best model for efficient revenue management. Their view is supported by the fact that close to 70% of physician groups with more than ten professionals preferred to outsource tasks related to processing of claims and management of collections.
Secondly, outsourcing RCM can help hospitals avoid seemingly-minor administrative mistake that can ultimately have a detrimental impact on revenue. Frequent instances of duplication of patient records that result in submission of inaccurate information in claims can impair collection of payments as well as possibility of future appointments and positive recommendations. An expert agency that specializes in collection management will enable hospitals to streamline the revenue cycle to minimize instances of errors and mistakes.
Thirdly, reducing instances of rejected claims and reducing delays in claim reimbursement will automatically boost the hospital’s revenue management. After rising cost of supplies, rejection or delays in reimbursement is the biggest challenge faced by healthcare institutions today. In many cases, rejected claims end up as bad debt when simply resubmitting the claims with accurate information may suffice.
A specialist collection agency entrusted with the task of claims and collection management will be a preferred choice as compared to an in-house department that is saddled with many other duties and responsibilities.
Impact of our Services on your RCM
One aspect of efficient revenue management is to facilitate smooth flow of information through all the steps of the cycle beginning with pre-registration till posting of payments, processing of appeals, and the collection of the funds.
The other aspect is to avoid errors that will result in a ripple effect across all clinical and administrative activities in the cycle. Improper case management may increase changes of rejection of claims, require additional expenditure towards follow up and processing of collections. The issue will get compounded when future appointments are scheduled leading to further errors and additional complications.
Our collection services function as an extension of healthcare organizations by providing accurate and updated information about charge capture, submission of claims, processing and remittances and other related administrative tasks. This external input serves as valuable feedback for hospitals to fine tune processes and improve efficiency. Further, absence of errors will ensure hospitals can avoid wasting time rectify administrative mistakes and can focus on providing quality healthcare instead.