Change begins with a basic awareness that your current actions are not producing the results you want or need. As in any industry, healthcare organizations must evaluate their business practices continually to ensure they are efficient and effective.
A big part of any healthcare company's operations is its process of managing the revenue it collects for its services. If this isn't performed properly, the financial health of the entire organization could be jeopardized, so it is worth examining how to know when your revenue cycle management needs improvement and, if so, how to go about changing current practices to achieve - and maintain - optimal results.
How Well is Your Healthcare Business Handling Cash Flow?
When determining whether you need to improve revenue cycle management, begin with three basic considerations:
Monthly revenue vs. operational costs
Is the money your healthcare business generates keeping pace with the bills and salaries you have to pay out each month? Conduct a financial performance audit to determine not only if you are operating in the black but also the sources of any lag you may be experiencing over time. You may be bringing in plenty of business, but if your medical records management is cumbersome or your general workflow is flawed, your payments will languish in the billing stage and not become the revenue you need.
What is the state of your accounts receivable?
This amount is very telling of your revenue cycle efficiency; the larger it is, the more your organization has fallen behind in billing. Money tied up in accounts receivable (A/R) has no real-time value, so your organization cannot access this source to free up capital for growth, add liquidity, or help reduce debt and lower costs, which ultimately makes it more healthy and competitive in the market.
How is your staff handling the workload?
How revenue cycle teams function can reveal a lot about the financial performance of your healthcare organization. Are tasks mostly manual, involving a lot of paper and hard filing? Is there enough transparency provided for all administrative staff members to know the statuses of patient accounts and access them at the appropriate times? Is there duplication in tasks and/or frustration expressed over tedious and needless steps in the process? The answers to these questions affect not only the stability of your organization's revenue cycle but your employee satisfaction level - an issue with its own financial ramifications in today's short-staffing climate.
How to Change Revenue Cycle Management for the Better
Once you identify that your revenue cycle management needs improving, you can begin pivoting with established best practices to help your healthcare organization optimize its processes and get the money it deserves.
Put the patient at the center of the process
Don’t think that any attempt to improve your revenue cycle management doesn’t involve your customer – the patient – and their willingness to pay you for the services you provide. They are your transactional partner and can be your best advocate if your organization works proactively to build a transparent and positive relationship with them. Doing your best to provide clear explanations to patients about their financial responsibility, payment options, and what to expect from their visit can go a long way toward easing the confusion and frustration they have historically expressed with healthcare billing. This interaction builds loyalty, making them more likely to reimburse your organization from the start.
Invest in technology
The following suggestions for improving your organization’s revenue cycle management are critical, but collectively they are very time-consuming when performed manually. Consider using technology where possible to automate, digitize, centralize, and store appropriate information for efficiency and accuracy that will provide you with full and timely reimbursements.
Improve appointment scheduling
Because revenue cycle management begins the moment a patient is scheduled for clinical service, ensuring the right volume of patients is seen daily helps set the proper expectations for revenue. Avoid the lost revenue of no-shows and other scheduling issues by providing technology that allows patients to self-schedule and issues automated reminders. Your patients will be more likely to show up as expected, and insights from the technology will allow your staff to adjust to demand more quickly as needed.
Automate patient eligibility verification
Patient registration is a tedious but necessary task, with insurance companies and government agencies requiring increasingly rigorous patient information for prior authorization and coverage eligibility. The drain on time can be significant, and the chance for human error can result in further delays or even claims rejections down the line. Liberating your staff with technology that automates data entry and speeds along this process not only improves your revenue cycle management but also helps optimize patient care and boosts their morale.
Collect patient financial responsibility before services are rendered
Healthcare revenue cycles slow or come to a halt when patient financial responsibility is late or underpaid. Staff must be vigilant in collecting deductibles or presenting payment plan options at the time of appointment. This involves ensuring the most up-to-date patient information is on file, along with verification of insurance and payment method. Offering patients the option to pay online is one way to receive timely payments because it provides convenience and a simple method that most people are now used to.
Improve charge capture and coding
As services are deemed necessary along the course of a patient’s care, it is important to efficiently capture these revenues. A lack of proper clinical or pharmaceutical documentation can create a disparity between the time and resources clinicians spend on patients and the payments received for their care. Providers should review charts and claims for missed charges and ensure all documentation is reported thoroughly and accurately, including medical coding.
Streamline Claims Processing
When payments involve reimbursements from insurance companies or other payers, it is critical to understand their deadlines for filing claims and have a timely process established for meeting them. Missed deadlines equate to unpaid claims and your organization writing off clinical services. In addition, ensure that all claims created during the process of care are accurate and complete before sending them to payers. Having claims returned means long delays and frustration before getting reimbursed; however, taking the time to carefully review every claim prior to submission is arduous and time-consuming as well. Consider investing in automated claims-scrubbing software that takes the manual labor out of this task while clearing the way for one-time submissions.
Track and follow up on claims
Denied and delinquent claims are both inevitable, but they can be minimized through careful planning and attention to detail. Monitoring and tracking denials are critical for any healthcare organization to identify trends and discover their root causes. Implement a denials prevention program for your staff that focuses on standardized processes to mitigate denials risk. This effort can reduce A/R, increase cash flow, decrease denials volume, and lower the cost-to-collect rate. Also, have a plan for contacting patients who aren’t paying on time. Present them with options that allow for flexibility and help your organization maximize the amount of revenue possible from these situations.
Establish Key Performance Indicators (KPI's) to Gauge Success
To truly measure your revenue cycle performance, start with five essential metrics to use as ongoing benchmarks of efficiency:
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Total reimbursement collected
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Net collections ratio
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Time claims spend in A/R
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First-pass acceptance rate
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Denial rate
An analytics tool is very helpful for monitoring these statistics (and more) by gathering them on a single dashboard to track progress.
To outsource or not?
One of the easiest ways to improve your revenue cycle management is to seek a consultant or entrust your medical billing practices with a full-service expert. The latter can provide your organization with consistently optimal results while removing the burden of revenue cycle management from your staff completely. However, this kind of service comes with a price: medical billing services in the U.S. generally acquire between 6.5% and 8% of monthly collections. Typically, this works out to a minimum monthly collection of $40,000.
Smaller healthcare organizations frequently opt to partner with technology vendors who can provide the broadest revenue cycle management functionality available while working with the organization's staff to achieve maximum efficiencies with their products and services. To ensure that these technologies align properly with existing structures, these vendors usually offer consultations, staff training, and opportunities for ongoing improvements that often add value to the overall cost of the technology.
Forcura is a trusted partner for optimizing the revenue cycle management process
Forcura, a healthcare workflow management company, enables healthcare providers to streamline incoming patient information and coordinate ongoing patient care resulting in improved business performance.
Forcura’s solution provides transparency into clinical records and workflows so users can take follow-up actions accordingly. Analytical data can also be used to optimize processes and uncover new efficiencies throughout the revenue cycle. More efficient processes allow final collections on outstanding accounts to begin sooner and yield more profitable results.
Check out Forcura today to see how your care teams can meet revenue cycle management requirements promptly and receive the full patient payments they deserve.
