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How Does Hospital Revenue Cycle Management Help Healthcare Firms?

by nicolejackson
hospital revenue cycle management

The revenue cycle management work includes a financial management process that helps track, identify, collect, and manage incoming payments. As a result, healthcare firms can foster financial transparency and charge patients the correct amount for the services and healthcare they receive. In addition, healthcare debt recovery services help facilitate required co-payments and forward treatment costs to patients and healthcare insurance agencies.

When implementing RCM, healthcare facilities can now avoid overcharging their patients, enhancing the overall experience. As you stick to the blog, we’ll focus on how revenue cycle management can assist your organization.

Purpose of revenue cycle management in healthcare

The overall purpose of the healthcare revenue cycle management is multi-faceted; this includes,

  • Interaction with a health insurance provider and patients
  • Billing for patient care
  • Revenue collection and reconciliation

The most basic way to explain the purpose of RCM is it unified the business and clinical sides of the industry. RCM combines administrative data with healthcare data to ensure each patient is taken care of and the facility meets its fair dues.

Healthcare Revenue Cycle Management Process in Steps

Steps to RCM in healthcare:

Patient Registration

First thing, you need to gather a patient’s necessary information. The information provided there helps you contact the patient when forwarding billing information. While you may have to collect the information once, the patient first enables you to explore arrears.

With every subsequent visit, you must confirm with the patient that their contact/insurance information is still correct. Information here includes

  • Home address
  • Email address
  • Phone number
  • Date of birth
  • Insurance information

Charge capture

Charge capturing details about the service the patient receives is sent to billing. There are two common ways to approach this step.

Automated: The hospital revenue cycle management extracts documentation from the facility as a part of the patient’s registration. The aim is to reduce human error and speed up the process.

Manual: This is an old way; the person at the front desk inputs the patient’s medical services into the system and forwards it to billing.

Claim submission

After the charges get captured and coded, a claim gets forwards by the hospital revenue cycle management. These charges are determined by the set rates of each medical code as attached to the claim.

If the claim is completed correctly, the insurance provider can quickly complete the payment. But if there are errors, the insurance company may send the share back to the facility to be completed properly.

Claims must be reviewed to avoid payment delays. This can quickly help identify and correct errors before the claims get forwarded.

Billing and collection

Patients need to cover some service costs out of their own pockets. The revenue cycle management can be calculated during a patient’s first appointment. Then, help make all payments during the registration phase.

It is traditionally challenging to obtain payment once the patient has left the facility. Therefore, the contact information gathered in the registration phase is used to send them an invoice for payment.

Advantages of RCM in healthcare

RCM offers medical services with many facilities; here are some of the benefits of hospital revenue cycle management.

  • Reduced errors
  • Faster collections
  • Enhanced patient experience
  • Simpler processes

Conclusion

Revenue management is an essential part of the organization’s financial literacy. When you adopt it to streamline the complex financial process, your organization is better prepared for the future.

With the RCM, you can collect numerous data points about the revenue management system. The experts include properly trained analysts on what specific datasets mean and when making a business decision about the RCM.

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