In the healthcare space, tracking and collecting revenue can be a complex process that is fraught with obstacles. To help with this, health care providers can benefit significantly from leveraging high-quality revenue cycle management. RCM services can increase profitability by driving down costs and improving revenue collection.
Healthcare has changed significantly in recent years. This has led to some inefficiencies and challenges that threaten the bottom line of many health care providers, especially hospital-based physician specialties.
As many as one in four claims are denied. Although the decision may be ultimately reversed or the patient may cover the balance, a denial can significantly reduce the likelihood of timely revenue collection. Typically, this is the result of errors in the coding and claims submission processes.
Between denied claims and slowing patient payments, it is increasingly more likely that accounts will have outstanding balances long after services have been provided. More bad debt means more unrealized reimbursements.
The healthcare value chain is a series of vendors, clinical providers, administrators, and other relationships that allow care for patients. Estimates suggest that the industry is currently spending as much as $765 billion on unnecessary, inefficient, inflated, and otherwise wasteful parts of the value chain.
The change from ICD-9 to ICD-10 increased the number of diagnoses and provider codes more than eightfold. A new revision, ICD-11, is already in the works. While these changes help improve the documentation and organization of medical care, they have also vastly increased the complexity of medical coding. This can represent millions of dollars in increased administration costs for large organizations.
Billing operations, whether in-house or outsourced play an important role in specialties like anesthesia and other hospital-based physician specialties which are complex to bill and code for. Without a strong understanding of the reimbursement and compliance nuances surrounding billing and coding, organizations are prone to have revenue leakage and compliance risks.
Patients are more concerned about the cost of healthcare than ever before. With the increasing risk of medical debt, patients want to have upfront information about what services will cost them. They also want in-depth information about the specifics of billing and payments.
Through revenue cycle management services, hospital-based physician services can run more efficiently and overcome many of the above-mentioned issues. These are a few of the advantages of well-implemented RCM processes:
The most significant impact of RCM for many organizations is the reduction in errors in the revenue cycle. Using high-quality software and expert-provided managed services, RCM can greatly increase the accuracy of your claims, bills, and collections process.
Thanks to those lower errors, the likelihood of denied claims reduce significantly when using the right RCM solutions. As mentioned, most denials are from technical or authorization issues. These can easily be averted through better processes.
With the reduced likelihood of claims being denied and better patient communication, organizations are more likely to collect timely payment. This is also true for reimbursements from government programs such as Medicare.
RCM also focuses on analyzing the healthcare value chain and understanding how expenses related to revenue. This can help cut inefficiencies and greatly reduce expenses.
Revenue cycle management improves accuracy in claims and documentation. It also ensures that workflows are more human-friendly, reducing frustration for staff members.
Good RCM solutions help to make information more readily available to patients. This can increase engagement and ensure greater transparency with value-based care and billing.
With managed services, your organization can be readier for varying administrative burdens. Not only will RCM help to simplify processes and improve efficiency, but it will also help to avoid the risk of administrative overload.
Overall, RCM services can empower healthcare providers and facilities to operate more efficiently. Revenue errors alone may cost as much as 5% of revenue. Inefficient processes cost even more. These issues quickly add up to substantially reduced profitability in healthcare. abeo helps private and employed physician groups and ASCs with RCM software and managed business services.
abeo Management Corporation (abeo) serves as a leading source of revenue cycle management and practice management with a specialization in anesthesia. The company leverages its people, processes, and software to serve independent practices, surgery centers, hospitals and healthcare systems with a scope of services that include billing, coding, transcription, practice management, and business consulting.