Healthcare is a dynamic and competitive industry. where revenue is crucial for practices. The advent of an RCM system for revenue cycle management for medical practices is one way that healthcare has developed in recent years (RCM). Revenue cycle management is a method used by healthcare organisations in the United States to track revenue from patients from the time they make their first appointment or take consultation via any other mode with the organisation until they settle their debt with the practice.
RCMs have helped providers decrease administrative expenses while simultaneously enhancing patient care through enhanced efficiency by combining billing, accounts receivable, collections, compliance, and other services into one holistic system.
A healthcare revenue cycle flowchart is the best way to understand the full cycle revenue cycle and hope. Although each healthcare practice may have different steps in the flow chart, however, some of the steps are very much common
This article goes over each of these steps, what they comprise, what might go wrong during the revenue cycle process, and how these steps play their individual role.
In this step, the patient makes an appointment with a healthcare provider by contacting the organization or clinic. Some organizations use software to automate this process whereas, others use manual scheduling.
This is an important and the first step in the revenue cycle since it can bring significant financial benefits to both parties involved in it. In terms of the patient, it not only saves time because they do not have to fill out forms in the waiting room so they have more time to see the doctor. Furthermore. it also lets them know their out-of-pocket costs in advance so they don’t receive a bill with surprises.
For the hospital, letting patients know their projected out-of-pocket costs for a service increases the likelihood that they will pay their bill on time, thereby reducing bad debt.
Insurance Eligibility Verification –
Verifying patient insurance eligibility is the most important step in revenue cycle management. This step is critical for the final portion of the procedure. The physician or their assigned staff team must critically verify the plan coverage and various perks of the patients’ medical bills as mentioned in their insurance card. This helps them avoid claim rejections and denials. Patients can remain stress-free by knowing that their medical issues will get covered by their respective medical insurance companies.
During registration, practices collect additional patient information. This phase confirms that all required patient registration information was gathered throughout the pre-registration process. If the hospital detects an error on the patient’s registration form, now is the moment to notify the patient before the error becomes a much greater problem in future. Just like this step, this step is critical to make sure that a clean claim goes through.
Accurate medical coding –
Medical help insurance companies understand what treatment a patient received from the practice. Since hospitals and health systems are offering such a vast array of health services and pharmaceuticals today, coding is needed to translate written descriptions of procedures, services, items, and patient conditions into numeric or alphanumeric codes. These codes help health systems to track vital information as well.
Charge capture –
Charge capture is the 5th step in the revenue cycle process. During the charge capture process, providers document patient encounters in the medical record and assign codes for claims. Staff then convert those codes into charges. There are 2 ways to do capture charges in medical billing. The first is the automated one where the information flows into the system with the help of software and the other one is the traditional way where each piece of information is manually punched into the system. There are advantages and disadvantages to both. Efficient charge capture can drastically increase the revenue of the practices. Health care professionals know it and they try to capture every single service they render their service for. On the contrary, if the charge capture process has flaws practices may face losses that may become huge amount with time.
Submission of claims to insurance companies
After the completion of the step of coding and charge capture, the hospital medical team or the outsourcing team submit the claims to respective insurance companies so that they can receive payments. Practices need to make sure that they do not commit any errors or miss the deadline to file the claim. There are various types of mistakes that can happen while submitting claims. The majority of these, errors are avoidable. However, if any error does take place then it can turn into a claim denial or rejection. Furthermore, this can prolong the time it takes for insurance companies to reimburse hospitals.
Checking of claims by Insurance companies –
Following the submission of claims, the payer insurance network reviews the submitted claims carefully. This process, however, takes some time to complete. Meanwhile, the billing team must follow up with the payer’s office frequently. The outcome of a medical claim depends upon the accuracy and completeness of the claim information. It is your responsibility as a medical biller to ensure that this information is accurate and complete.
Payment Processing –
Upon receiving a part of the claim from the insurance provider, the patient must pay the balance. The medical billing team prepares a comprehensive bill with all the insurance coverage and explains the patient’s out-of-pocket costs.
Role of Account receivable –
A/R staff analyzes the payment received by the insurance provider or payer to determine if the payment was approved or if there was an error that cause the payment delay.
In the event of a claim error, the claim goes back to the clearinghouse, whose job it is to review and correct the claim. It sends the claim back to the insurance claim after adjusting the claim amount if needed.
Denial management –
As part of the healthcare revenue cycle flowchart, there are some important back-end functions. These include checking the status of claims, analysing claim denials, and contacting patients to collect payments on outstanding balances. Claims may have to be resubmitted for payment, and patient statements may need to be reviewed. A patient who refuses to pay their information may get shared with collections here. The back end also takes care of any additional revenue received by the practice.
A healthcare revenue cycle flow chart in medical billing is the best way to understand the complexities and importance of various steps. It also helps practices to put focus on each step, find issues and fix them. One of the best ways for practices to keep the RCM in the best shape is by outsourcing to companies like Virtual Oplossing which is a top-class RCM and medical billing company.