REVENUE CYCLE MANAGEMENT: What’s it mean? In a nutshell, it means taking steps to assure that you get paid for what you do and that you get paid in a timely fashion.
The revenue cycle starts when the patient calls your office for an appointment and your staff captures the patient’s name, phone number, and maybe the name of their insurance company.
The cycle ends when the balance on their account is zero.
Why You Need Professional ?
DATA GATHERING IS CRUCIAL
Some practices say they can’t afford to take the time on the phone when the patient calls for an appointment to collect insurance information. That means that the practice doesn’t get to verify the patient’s insurance coverage before the appointment.
If you don’t verify coverage before the patient presents, you have to hold up rooming the patient to verify the insurance when they check in. That’s inefficient for everyone in the practice and often puts the whole schedule behind for the day.
Pre-visit eligibility verification is a best practice that every physician office should strive to accomplish. If you find out that the patient is not covered for the visit a couple of days before the scheduled appointment, you can contact the patient to either get corrected information, or maybe even reschedule the patient if necessary.
You can submit all patients on a day’s schedule in an electronic file and send it to a clearing house to verify eligibility for all appointed services (it’s called “batching”). Doing so will reduce the volume of denied claims.
HOW ELIGIBILITY VERIFICATION HELPS
During a recent consulting engagement, a sampling of denials showed that 3,450 claims had been denied the first time they’d been sent through. That’s a first-pass denial rate of 6.9%; the rate for better-performing practices is approximately 3%.
Approximately two-thirds of the denials (2,270) were because of eligibility issues.
The cost of managing those denials is approximately $25 per claim, which means that that group spends $18,900 every month to work denials that could be eliminated with an investment in batch eligibility for all scheduled appointments.
It takes four individuals in the billing office to work the denied claims for that practice.
Do you know your volume of denied claims and why they are denied?
USE THE CORRECT NUMBERS
Accurate patient registration and billing information is a critical first step. Getting the charge posted with the CPT service code and ICD-9 diagnosis code on a timely basis is the next step in the revenue cycle process.
Some practices hold their charge slips for a full day or even more. Sometimes they have someone cross referencing the appointment schedule against all the charge slips to be sure they have not missed charges, but that delays the charge posting and billing process by at least a day.
Most practice management systems have a “missing charge” report that automates the cross-check process so there is no added value for holding onto charge slips for a day; and, in fact, the process of holding charges increases the work load by forcing you to check each charge slip against the report, rather than simply hunting up the missed charge slips as identified by the report.
If you’re not using the missing charge report function, find out why not and consider using it. If your practice management system doesn’t have the function, ask if it can be added, or do a cost-benefit analysis on switching systems.
The revenue cycle process is enhanced with electronic claim submission and electronic remittance payment posting.
Automated posting saves staff time and that time can be used to follow up on outstanding claims or overdue balances.
The quickest way to a zero balance is to automate those tasks that do not require your billing staff’s expertise and to use that expertise to communicate with the payers as needed.
You can also shorten the revenue cycle by offering your patients online bill payment and e-statements.
E-statements cost less than 60% of the price of a paper bill to produce.
You pay your own bills online, why not invite your patients to do the same for your practice?
So, four steps to effective revenue cycle management:
Θ Gather Data
Θ Verify Eligibility
Θ Use the Correct Numbers
Θ Automate the Process as Much as Possible