Revenue Cycle Management – A Closer Look
The Healthcare industry is experiencing its next wave of changes. The shift to value based care, increasing regulatory demands and employer provided insurance coverage are all shifting the self-pay portions to patients. These challenges have pushed the cost of care to record levels. Payer contracts have also become overly complex, complicating claims management capabilities and forcing negotiation through distorted contractual provisions – such as bundled edits, carve-outs, modifier rules and alternate fee schedules. Not only are daily challenges mounting, but today’s sophisticated systems are too complex, making it virtually impossible for any organization to reap the full benefit of what these systems can offer.
Revenue Cycle Process
Providers must closely reexamine their Revenue Cycle Management (RCM) processes – starting with eligibility and benefits verification to denial / nderpayment management and everything in between. Providers understand that the patients’ encounter starts before they arrive at the hospital through scheduling and registration and collecting patient information for eligibility and benefits coordination.
It is imperative to capture the demographic, financial and clinical information as accurately as possible from the beginning. Errors of this type often lead to billing delays and even claim denials. By collecting accurate information and using sophisticated analytical systems, patients can be triaged financially to determine how their account will be managed during the episode of care.
This may require using financial clearance processes and involve screening and scoring the patient to determine the most effective collection arrangements. Some systems also assist in determining if the patient is qualified for Medicaid or other government assisted programs. Systems, like financial clearance tools, can also assist in credit scoring and estimate the likelihood of collecting payment.
To summarize, the RCM processes includes the following:• Accurately capturing patient information at the time of registration and scheduling
• Appropriately classifying patients financial risks and managing the process
• Using historical and real time data to identify problem areas through analytical tools
• Prioritizing claim denial and appeal activities to triage the patient based on risks scores
• Developing an automated reporting and alerts system for both staff and patient reminders
• Developing denial prevention rules to detect and avoid at risk clinical eligibility and authorization
Revenue Cycle Optimization
Once the RCM is in place, organizations must shift focus to the optimization phase of the processes. One such tactic is to implement Key Performance Indicators (KPIs) and report variation using tools such as Balanced Score Card (BSC) to provide measurements and benchmarks against baseline. To drive this, financial discipline organizations must develop a continuous improvement process whereby they have measurable goals and milestones.
Additionally, to derive accountability, organizations must assign roles and responsibilities through a RACI (Responsible, Accountable, Communicated, Informed) Matrix with a clearly defined committee, tasked with monitoring progress. Senior leadership must be fully engaged and support the process by removing barriers across the organization. Continuous and clear communication across the organization will keep the staff engaged and enthused for the duration of the project.
The RCM continuous process improvement includes the following components:• Process documentation of the current state
• Functional automation through technology and tools
• Developing future state by optimizing the current processes
• Collecting data, monitoring progress and ensuring systems are in control
• Using data analytics to determine the best course of action for patient population
Zand, Peyman. Fri, 21 Oct 2016. “Revenue Cycle Management.” LinkedIn.com. Retrieved from: https://www.linkedin.com/pulse/revenue-cycle-management-peyman-zand?trk=prof-post