If you’re an experienced professional in the healthcare industry, healthcare revenue cycle management likely comes as second nature to you, or at least you are familiar with it. However, for newcomers, it can appear as a complex labyrinth of terminology, regulations, and uncertainties.
Healthcare provision has evolved beyond the doctor-patient relationship and now involves various stakeholders, including government programs and insurance companies. These entities enable healthcare providers to extend medical services to those who may not be able to afford them. With national health spending projected to reach $6.8 trillion by 2030, expedited reimbursement is critical for maintaining the financial health of medical practices.
Managing your revenue cycle on your own can be overwhelming. Juggling multiple roles within a company can divert your focus from providing top-quality patient care. Achieving a balance among increased procedures, providers, and cash flow necessitates a well-structured game plan.
Revenue Cycle Management (RCM) refers to the process by which healthcare organizations track patients from registration to billing. RCM software facilitates the integration of clinical and administrative responsibilities while ensuring the security of protected health information. In this guide, we present the ultimate resource for revenue cycle outsourcing.
Advantages of Revenue Cycle Management
There are numerous advantages to having a robust revenue cycle management strategy in place. After all, it’s better to be prepared than caught off guard.
Advantage 1: Automation
One of the primary benefits is the ability to automate administrative and billing tasks. Your front desk staff will appreciate this, as it streamlines hours of tedious work with the click of a button, freeing up more time for patient care. Functions such as patient reminders, calculating existing patient balances, managing claim denials, and more have become readily accessible.
Reducing the workload for your front desk or administrative team can help lower administrative overhead, resulting in cost savings.
Advantage 2: Clear Communication
Moreover, reducing miscommunication is another significant advantage. With a smaller team managing the flow of information, the chances of errors in the cycle decrease, leading to faster reimbursement for services rendered.
For instance, consider claim rejections a common issue. Common reasons for claim rejection include missing patient information, late filing, and incorrect data entry. Allowing sufficient time for double-checking information can prevent unnecessary delays and revenue loss.
By implementing these automated functions, your company can operate more smoothly, which is especially important given the approximately 20% increase in claim denials over the last five years, making RCM software highly sought after.
Revenue Cycle Outsourcing
Feeling overwhelmed? There’s good news for you.
While revenue cycle management can be complex, you don’t have to handle it all by yourself. Healthcare revenue cycle management companies understand that investing in this technology leads to more data collection and improved process safeguards.
However, this can be time-consuming and potentially stressful for your team. That’s why the option of outsourcing your administrative functions to these specialized companies is available.
Outsourced RCM performs the same tasks you would typically manage with your in-house team but delegates some or all of these tasks to a third-party provider.
The specific services available for outsourcing can vary depending on the company you choose and your specific needs. Here are some common services offered when outsourcing RCM:
- Charge entry
- Claim submission
- Claim appeals
- Coding
- HIPAA compliance
- Online patient payments
- Patient collections
- Patient inquiries
- Patient statements
- Payment posting
- Data reporting
The more services you access, the higher your RCM costs will be. By evaluating your company’s priorities and size, you can determine which services are essential.
The Benefits of Outsourcing RCM
Benefit 1: Improved Patient Care
Managing both the administrative and patient aspects of your business is time-consuming. Focusing on administrative tasks alone can be stressful. As a medical professional, your top priority is your patients. Outsourcing your RCM services can free up time to focus on patient care and ensure thorough documentation.
Rushed examinations can lead to medical coding errors or, worse, leave patients feeling unheard or undervalued. Reducing the administrative workload for direct care providers can lead to better accuracy in care and higher patient satisfaction.
Benefit 2: Timely Reimbursements
As mentioned earlier, claim denials can cause delays in reimbursement. Incorrect ICD and CPT codes can result in weeks or even months of delay. Often, you may not even be notified of a claim denial until days later.
To avoid these issues and ensure claims are processed promptly, using code check software and sending claims to clearinghouses is a valuable RCM service.
Benefit 3: Cost Reduction
If you choose to handle all your RCM needs in-house, you’ll need to hire additional staff, which comes with added expenses such as salaries, benefits, training, and more.
Outsourcing RCM allows you to pay a flat monthly rate for professional services without the overhead costs associated with in-house hiring. You also have the flexibility to adjust your services as needed, avoiding the need for layoffs.
Benefit 4: Improved Workflow
Outsourcing your healthcare revenue cycle management can enhance your organization’s operations significantly. Partnering with the right clearinghouse provides essential checks on claims before they reach the payer, known as claim scrubbing.
This additional step can reduce claim denials and increase your revenue, improving the overall workflow.
Benefit 5: Reduced Stress
Operating a healthcare organization involves many responsibilities, from managing employees to day-to-day operations. Financial management is a critical aspect that demands attention.
By sharing the burden with an outsourcing partner, you not only avoid mistakes but also create a happier and more productive work environment. Research suggests that happy employees are around 12% more productive.
Conclusion
Effective revenue cycle management is essential for the success of any business, especially in the ever-evolving healthcare industry. As discussed in this guide, healthcare organizations require structure to remain financially stable.
There are numerous tools available in the RCM toolkit to boost revenue and reduce overhead costs, and you can tailor your approach to meet your specific needs.
When choosing a reputed healthcare revenue cycle management company, consider pricing models, service guarantees, user integration, data privacy, and call center availability. While this list isn’t exhaustive, it covers some of the key factors to consider. Choosing the right RCM provider can make the difference between a thriving establishment and a struggling business.
