Incorrect medical billing, underpaid reimbursements, inability to comply with standards, and threats to …
Regardless of the type of healthcare organization, the healthcare revenue cycle is critical. However, many organizations still struggle with the Revenue Cycle Management (RCM) process. In this blog post, we will list some of the most common hospital RCM challenges and provide one key solution for overcoming them. Read on to learn more!
There’s no question that Revenue Cycle Management is vital for hospitals and healthcare organizations. But what exactly does RCM entail, and why is it so critical?
Healthcare Revenue Cycle Management is the process of ensuring all hospital income is appropriately collected and recorded. Effective RCM is essential to a hospital’s financial health by helping ensure the hospital is paid for the care it provides and that it can cover its costs. In addition, good Revenue Cycle Management can help improve cash flow and reduce bad debt or debt that hospitals end up writing off due to non-payment.
Despite the number of benefits that Revenue Cycle Management offers, most hospitals still struggle with it. Here’s a (non-inclusive) list of hospital Revenue Cycle Management challenges.
1. The Problem With Billing Errors
One of the most important aspects of hospital Revenue Cycle Management is billing. It is critical that hospital staff correctly bill for every service rendered. Unfortunately, billing mistakes happen, and when they do, revenue is lost.
In some cases, hospital staff may not have had the proper training to ensure that each payer’s subtle nuances are recognized and adhered to with each claim submission. In other cases, billing deadlines could be missed (depending on the payer, there could be many different ones), resulting in lost revenue and a negative impact on the hospital’s bottom line.
2. The Problem With Payment Strategy
A Healthcare.com survey reported that 1 in 3 US adults carry medical debt, and some of those individuals with debt even have good health insurance. One of the main reasons for this could be that with the intricacies of today’s health insurance, these patients may just not understand how their insurance should work and the payment methods available to them.
Not only is this confusion challenging for patients, but the organization also feels the burn in the form of inconsistent cash flow.
3. The Stringent Compliance Standards
Upcoding. Unbundling. Fraud. Abuse. Waste. All of these buzzwords are deeply rooted in compliance requirements that your organization needs to have a strong and multifaceted understanding of.
HIPAA. CMS. Private payers. Again, the list of who requires what sometimes seems endless.
With so much on their plates, understanding the nitty-gritty of each of these just tends to get overwhelming for most providers.
4. The Need for Increased Interoperability
In order to optimize healthcare Revenue Cycle Management, increased interoperability is needed between systems and software applications. Most traditional health systems lack interconnectedness and tend to have problems with data sharing.
Data silos result from this lack of interoperability, which leads to inefficiencies and errors. For example, a lack of interoperability can result in duplicate medical records, delayed billing, and, ultimately, denied claims. In addition, interoperability issues can make it difficult for providers to coordinate care and share information with patients.
5. The Burden of Non-clinical Tasks
Non-clinical tasks, such as RCM tasks, can become burdensome when they take valuable patient-care time away from providers. But these tasks have to be completed. That balancing act can lead to high levels of provider stress and, sometimes, even burnout. As a result, finding a way to reduce the burden of RCM tasks for patient-care professionals is vital.
6. The Lack of Appropriate Training
Everyone’s busy. Finding time to complete general day-to-day tasks often seems impossible, let alone finding time to routinely continue your own education on compliance and regulatory requirements. And then new staff training on top of that? It becomes an impossible-feeling task. But, without this commitment to education and training, the chance for errors, and subsequent lost revenue, creeps ever higher.
7. The Absence of Data-driven Insights
Data-driven insights are essential for efficient and effective healthcare Revenue Cycle Management. Without data, it’s almost impossible to track important metrics such as patient volume, reimbursement rates, and denials. Additionally, data is necessary for identifying areas of improvement and developing strategies for optimizing revenue.
Unfortunately, many healthcare organizations still lack data-driven insights due to a lack of investment in data infrastructure and analytics. As a result, they often struggle with inefficiencies and lost revenue.
In order to compete in the rapidly changing healthcare landscape, organizations need to invest in data-driven insights. Only then will they be able to improve their bottom line and better serve their patients.
8. The Consistent Need to Follow Up
The consistent need for follow-ups is a crucial piece of the healthcare revenue cycle. Without consistent follow-ups, inefficiencies, gaps, broken workflows, and missing pieces can go unnoticed and unaddressed.
These follow-ups require dedicated attention, as the sooner you can find out there is an issue, the sooner you can start correcting it and hopefully avoid any serious repercussions. Take a claim, for example. Without consistent follow-up practices, a claim with errors could go unnoticed until after the timely filing deadline. Or, worse still, not only could the timely filing deadline have passed for that specific claim, but the practice that resulted in the errors in the first place may have been ongoing for months or years. That’s a lot of potential for lost revenue.
A Solid Way to Tackle The Hospital Revenue Cycle Management Challenges
While all of the above are unique challenges related to hospital Revenue Cycle Management, they also share one possible solution: outsourcing your Revenue Cycle Management to an external partner.
A highly-trained RCM vendor can help you deal with timing issues like billing by automating the workflow and ensuring an error-free process, which ultimately reduces gaps between medical billing and claim reimbursement. An RCM vendor also helps you focus on a patient-centric approach that results in patients being satisfied with all aspects of their care, up to and including bill payment, which results in a guaranteed steady revenue stream for your healthcare organization.
By adopting interoperability standards, healthcare organizations can improve the efficiency of their Revenue Cycle Management process and reduce costs. In addition, increased interoperability will allow providers to coordinate care efficiently and improve patient outcomes. An RCM partner could help you better meet the stringent interoperability standards. They can take the heaviest burden from your organization by ensuring your accounts are handled by highly-trained and experienced specialists.
The partner also helps reduce your providers’ burden by separating the RCM tasks from the crucial care needs of your patients. This allows your providers more time to spend with patient care, resulting in a reduction in the overall cost and an improvement in the quality of care provided.
An RCM partner also takes on the consistent follow-up needs of your organization’s revenue cycle. If a claim is denied due to an internal workflow change, an RCM partner can continue to monitor this trend on a go-forward basis to ensure the fixes you have put into place are actually working. There’s nothing worse than creating an elaborate workflow only to find out no one is following it! Instead, an RCM partner can help you monitor your processes for success.
The revenue cycle for hospitals is definitely fraught with many challenges. However, there are many solutions available to either avoid or fix these problems. By working with an experienced and reputable healthcare Revenue Cycle Management service provider, you can rest assured that your hospital’s finances will be in good hands.
If you are looking for an efficient revenue cycle, consider partnering with us at 314e. Our team of experts has years of experience helping organizations just like yours overcome revenue cycle challenges and improve their financial performance.
Contact us today to learn how we can help you!