Revenue management is vital for any business to make sure that there is sufficient cash for outgoing expenditure. The revenue management cycle plays a crucial role in this, especially for the professionals involved in healthcare industries due to the complexities in collecting revenue & billing.
So what exactly is revenue cycle management?
Revenue cycle management is the process where we handle payment processing, billing & the collection of revenue. A revenue cycle is nothing but a systematic approach beginning with billing the customers & ending with collecting patients’ payments or writing bills off. While some organizations can achieve this quickly, it’s complex for other organizations like healthcare.
Health-based RCM involves the tools & practices which ensure the smooth proceedings of the revenue cycle & maximum revenue they are legally entitled to, that too in a possible timely manner. As a result, you can enjoy a more reliable foundation of incoming & predictable revenue as cash by using revenue cycle management.
How does it fit into health systems?
It isn’t a surprise that healthcare revenue cycle management services are essential for the long-lasting success of a healthcare organization. Now let’s discuss the steps that it includes:
a) Claim preparation
Before submitting any claim, we need to capture all the patient’s information, which typically occurs before the first appointment. If it’s related to anesthesia providers, the process takes place on the day of surgery. Additionally, we need to confirm the patient’s insurance coverage and eligibility.
b) Claiming submission
Claims are created, the charges are entered & coded & last but not least, the suit gets submitted to the patient’s insurance during this step.
c) Management of the claim
This stage involves the management of the claim & following the response from the insurance companies. It also includes posting any relevant payments.
d) Collection of receivables
During this step, We need to pursue collecting payment from the patient, which can involve issuing statements & sending bills to collections, if required.
e) Analyzing and evaluating
Finally, the billing team will use RCM software to collect and analyze the data.
Revenue management systems can minimize errors, increase payment likelihood, and avoid accounts receivable from aging. Additionally, it can also increase claims efficiency while reconciling costs against revenues to optimize cash flow.
Also Read: Benefits of hiring private physicians
Why is healthcare revenue management service is essential?
The reality of healthcare RCM is that the process of initial collection to complete payment is complex, which leads to a protracted delay between service provision & the collection of revenue. In worst situations, it can lead to mistakes, unnecessary back and forth & confusion.
Implementation of effective revenue cycle management is essential for all health systems. Each healthcare services line has its process. But the main question is whether they are being well implemented, thoughtful & are taking the required nuances of the speciality into account.
Benefits of well-implemented Revenue cycle management program
There are significant benefits of outsources healthcare base RCM to third-party service providers & below, and we are mentioning a few of them:
a) Improvement in revenue performance
One of the significant benefits you will receive from an effective RCM program is the increase in revenue performance which means that money will come faster, more consistently & lower expenses which are necessary to earn it. Ins short, the job of revenue cycle management is to improve the performance of your finance.
b) Increasing visibility
The central element to measure the effectiveness of any RCM is visibility. By increasing the visibility & examining the data, one can identify problems & inefficiencies & try to resolve them.
c) Creating demonstrable value
Every organization needs to prove its strength & performance to stakeholders, including donors, investors, trustees, or strategic partners. High-quality revenue cycle management provides you with all the necessary data to demonstrate your value. In addition, this makes it easier to align the interest of your healthcare organization with others for mutual success.
d) Simplication of the processes
Providing physicians, administrative staff & other healthcare professionals with a secure and straightforward system can help them significantly to improve their revenue cycle. Excellent revenue cycle management will only minimize the errors, remove frustration & confusion from your personnel.
Conclusion:
Healthcare revenue cycle management is evolving continuously to keep pace with the rapid changes in the healthcare ecosystem. As a healthcare professional, you should always know how your revenue cycle is performing to provide appropriate reimbursement & care.