Hospitals and health systems depend on patient payments to stay afloat. It includes patient registration, compensation claims, and reimbursement. Patients, insurance companies, and taxpayers must be consulted. US healthcare providers use revenue cycle management to track patient revenue from initial contact to bill payment.
The revenue cycle begins with an appointment or hospital stay and ends when the doctor or hospital receives full payment. It includes pre-registration, registration, charge capture, claim filing, remittance processing, insurance follow-up, and patient collections.
This blog covers the revenue cycle’s phases, potential pitfalls, and best practices. Let us begin!
Stage 1: Design Your RCM Work Model
The first significant landmark of the 13 phases of revenue cycle management is a repeatable work model for proven gains in RCM. Analyze your current teams working towards the RCM in your organization. In the past few years, more than half of healthcare CEOs have switched to using RCM software for this purpose, or they have outsourced the entire process to specialized firms.
The best businesses in your field stay abreast of regulatory changes so they can assist you in climbing the cash flow curve. They use tried-and-true methods to increase medical facilities’ profits.
Stage 2: Align Your RCM Staff
Now that you know what kind of work model will best serve your organization, you can turn your attention to aligning the personnel. Workers in the department are the unsung heroes of financial management since they implement RCM in all its forms. If you have chosen revenue cycle software, go for staff training sessions so that they are comfortable using it. Find out outsourcing business services provided and how your in-house team may coordinate with them.
Stage 3: Patient Registration
One of the most crucial parts of the 13-step revenue cycle management process is patient registration, which is the initial step in submitting a clean claim. Record all identifying information necessary to create or modify the account. According to professionals in the revenue cycle, claim denials are expected because of incorrect or missing patient information provided at registration.
Stage 4: Patient Eligibility Verification
To learn whether the patient’s insurer covers services, you must verify the account’s insurance information. To keep the communication open with the patient, it is essential to contact them ahead of time if there is any reason to suspect a problem with the verification procedure. Ensure that the policy is current and hasn’t lapsed. If the patient doesn’t have insurance, they’ll have to pay out of pocket, which can be problematic.
Stage 5: Prior Authorization
Prior permission requirements for specific medical services vary by the insurance provider. Before requesting a pre-auth, you’ll need to provide evidence of the medical necessity for the operations in question. It’s important to remember that private companies and government agencies may have varying pre-authorization requirements.
Stage 6: Co-Payment And Deductibles
At the time of the medical service, the patient must pay the out-of-pocket cost that their insurance company does not cover. Since most healthcare systems fail to collect payments during this period, this process can be challenging to manage. Share information about the office’s financial aid programs so that clients can make educated decisions and the business can maintain a steady cash flow.
Stage 7: Coding Of Services
Coding is a crucial step if you want a clear claim and fair compensation. Make sure your coders have the most recent information on federal coding rules revisions. Make sure you’re not losing money on income by not using the latest codes and by holding frequent training sessions for your workers.
Stage 8: Claim Submission
Once the appropriate codes have been entered, the insurance provider can submit the claim form. It’s important to keep the claims from piling up so that payments can be made on schedule. It is important to double-check the claim’s format and allocated codes before sending it in to make sure no important details are left out. Keep in mind that your claim will have a far better chance of being approved if you provide all of the information requested.
Stage 9: Claim Reimbursement
The insurance company will verify the claim with their database and pay the patient the amount they determine is appropriate based on the policy. Your reimbursement may be reduced if you don’t have the proper paperwork or get turned down for service. The insurance carrier sends the Explanation of Benefits to explain the denial.
Stage 10: Claim Denial Management
Even if the billing teams try their best to ensure a clean claim for submission, most of the claims are partially or entirely denied by the insurance company due to numerous other factors. To ensure that corrected claims are resubmitted on time or with any additional documentation requested by the insurance company, you should implement a rejection management workflow.
Stage 11: Review for Payment Variances
Your claim may not be fully reimbursed due to medical necessity or major/minor surgery classification issues. When the reimbursement check comes in, review the amounts and submit a written appeal to the appropriate insurance provider.
Stage 12: Patient Collections
Collecting the remaining due amount from the patients is one of the most demanding phases in the 13 processes of revenue cycle management. Following up with the patients regarding their dues with the right explanation of the insurance coverage is vital to achieving proper collections. Companies specializing in RCM employ special teams whose sole purpose is to monitor patients and ensure a healthy revenue cycle.
Stage 13: Financial Evaluation
You can better predict future outcomes for the company if you use data extracted from the sales cycle. Customized reports from RCM businesses or the data analytics reports included in most RCM software might be useful here. Reports will indicate where you are performing well and areas to improve.
The revenue cycle process can greatly benefit from automation. However, many EHRs and other PMSes provide many reports that are both time-consuming and don’t deliver the precise data needed. When you partner with a third party, they may help you design a dashboard to monitor your revenue cycle and ensure everything is running well. A customized dashboard holds all necessary reports.
Seek advice from a professional if you’re having trouble with any stage of the revenue cycle. You will reap long-term benefits if you take the time to organize your procedures now.