The revenue cycle is not limited to businesses only, but it serves as a foundation for healthcare organizations. A financial analysis is essential to check where, when, and why you spend your expenditures on healthcare. In this article, we’ll explore revenue cycle analysis in healthcare, the steps involved, key challenges, and the facts to overcome the revenue cycle challenges in healthcare. So, let’s get started!
The medical billing and coding process, from the patient’s treatment schedule to the provider’s payments to maintain financial stability, is termed revenue cycle management in healthcare. On the other side, a complete economic analysis of the revenue cycle management of a healthcare organization and providing feedback for improvements is called revenue cycle analysis in healthcare.
Revenue cycle management (RCM) is not a one-step process. It involves a complete series of steps. Without these steps, a healthcare organization cannot attain financial stability. So, let’s look at those steps:
Registration of the patient is an initial step. Before completely registering a patient, a complete documentation verification is done to ensure that the patient meets the eligibility criteria set by Medicaid or Medicare. Likewise, pre-authorization helps determine the planned services covered by the payer.
When a patient receives care, it is converted into alphanumeric codes, which medical coders perform. All billable services and procedures are captured in healthcare financial management to improve reimbursements and optimize revenue.
When coding is complete, the next step is creating and submitting claims and securing insurance registration. Moreover, the claim’s submission includes sending the patient’s information to the payer. After this, the payer processes the claims to demonstrate the amount of reimbursement for the services rendered.
The process of tracking and managing payments from patients and payers is called accounts receivable management. It further includes clearing unpaid claims and monitoring the timely delivery of the payments. Revenue cycle analysis in healthcare is vital to maintaining financial stability.
Claims denials are challenging for financial managers because they distort the whole revenue cycle process. Denials management occurs when there’s a need to resolve the issue or errors. The organization has to appeal for the claims reviews and might have to provide information to prove the validity of the claims.
Revenue optimization serves as a foundation of successful financial stability in healthcare. Let’s look at how revenue cycle optimization benefits a healthcare organization.
With the help of healthcare financial management, providers can receive efficient reimbursements. When the provider submits timely claims, it accelerates the reimbursement process, leading to fewer denials.
An efficient revenue cycle analysis in healthcare practice can detect early issues, especially with payments. By practicing RCM, a financial manager can provide solutions for patients with debts, significantly reducing the debts. Moreover, it balances the billing processes, and providers get timely payments for the services rendered.
Providers, patients, and payors face challenges that must be resolved immediately. Otherwise, the healthcare organization will experience failed reimbursement, payment delays, and a reduced revenue cycle. The following are some challenges and solutions a healthcare organization experiences over time.
When the medical coder gives wrong information, the system rejects the treatment payments. It usually occurs due to a lack of staff training and documentation errors. Likewise, a patient might not be eligible for the insurance. However, to resolve this issue, proper staff training is compulsory. Additionally, update codes and verify the patient’s eligibility for a seamless revenue cycle process.
Healthcare organizations can easily optimize revenue by setting realistic and achievable revenue goals. By following effective RCM billing services, a significant increase in patient demographic and market dynamics can occur. Furthermore, auditing and continuous monitoring generate an optimal revenue cycle analysis in healthcare.
