What is revenue cycle management and why is it important for independent practices? Your practice revenue cycle begins with a patient’s initial call to make an appointment and runs through the point where that patient pays all outstanding balances. The cycle encompasses all aspects of the patient’s account with your practice.
As healthcare is moving away from the fee-for-service model and toward value-based care, it’s important to learn healthcare revenue cycle management best practices for your new practice. Before we look into revenue cycle best practices in detail, let's discuss some of the benefits of revenue cycle management.
Benefits of revenue cycle management
Revenue cycle management for healthcare providers includes all the functions that contribute to patient service revenue. So how can effective revenue cycle management help your new practice?
Benefits can include:
Significant cost reductions are typically associated with automating and digitizing your new practice’s billing, claims, and reimbursement functions. Streamlined administrative processes can save your practice a substantial amount of money.
Improved revenue collection
Using revenue cycle management best practices can improve revenue collection – both from patients and from third-party payers.
You can expect to see revenue increases through proper revenue cycle management as a result of quicker turnaround on invoices and minimized claim denials.
Flexible billing software & revenue cycle management solutions
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The top 7 revenue cycle management best practices
When you are searching for the right revenue cycle management system for your new practice, keep in mind a few tips about what you will need for effective end-to-end management of the patient-revenue process:
1. Confirm accuracy of patient data
First on our list of revenue cycle best practices is ensuring that all patient data is accurate. You should collect and confirm that all patient data, including insurance and demographic information, is correct and current at every visit.
2. Consolidate disparate EHR and billing systems into one
Consolidating Electronic Health Record (EHR) and billing systems into one integrated platform is a vital revenue cycle management best practice for several key reasons.
For one, working in separate clinical and billing systems creates bottlenecks and complicates workflows, requiring data duplication and manual data entry. This inefficiency can lead to errors and delays in billing, payment, and overall revenue management.
Also, systems like Elation EHR and Billing provide a single sign-on, offering seamless access to a user-friendly, integrated EHR and billing system. This unified access streamlines operations, reducing the need for multiple logins and data transfers.
With a comprehensive system, data is entered only once and automations can be implemented for tasks like claims processing and revenue tracking. This time-saving efficiency improves the revenue cycle management process and ensures timely and accurate billing.
3. Verify insurance information at the time of the appointment
Verifying insurance information up front is one of the revenue cycle management best practices because it allows for:
Timely treatment planning: Checking insurance information, including specific coverage, allows providers to recommend an appropriate course of treatment without waiting for confirmation from insurance companies.
Streamlined workflow: Elation Billing users can seamlessly perform eligibility checks directly from the patient appointment window, eliminating the need for screen-switching and ensuring a more efficient workflow. Elation Billing also offers automated eligibility checks to save valuable time.
Error reduction: Eligibility checking at the time of appointment minimizes errors and claim denials by providing accurate insurance details.
Centralized payer information: Elation Billing allows you to easily select payers from a synced list and update insurance information in the patient's chart. This simplifies the management of insurance details.
Improved security: With automated workflows, providers can ensure accurate reimbursements and patient payments, enhancing both data security and financial stability.
4. Address insurance denials quickly
As a best practice, you should always address anything insurance-related—insurance denials, appealing denials, and billing the patient—promptly and accurately.
Key steps include reviewing denial reasons, correcting coding errors, obtaining retroactive pre-authorization, transparently communicating with the patient, and mastering the appeal process.
Documenting interactions with the insurer and tracking the appeal progress is crucial. It's also important to keep the patient informed about potential financial responsibility.
This approach minimizes patient financial burden, fosters a positive patient-provider relationship, and optimizes revenue cycle management, ultimately enhancing patient care and satisfaction.
5. Simplify patient billing workflows
Simplifying patient billing workflows is a crucial revenue cycle management best practice for several reasons.
First, collecting co-pays at the time of the visit (based on insurance information) enhances revenue capture. When this process is streamlined, it ensures that payments are made promptly – reducing the risk of delayed or missed payments.
Payment flow is complex and inconsistent, making it difficult to transmit payment information from the EHR to Elation Billing. Simplified workflows that allow capturing payments directly from the appointment window within the EHR resolve any confusion. This not only minimizes user errors but also significantly improves practice efficiency.
Moreover, simplifying copay and balance collection with patient-friendly payment options, such as the ability to keep a card on file, encourages timely payments and reduces administrative burdens.
Furthermore, by differentiating copayments from outstanding balances—and automatically identifying and linking payment postings to specific encounters—practices can confidently manage their financial records and minimize errors.
6. Streamline patient statement delivery
Streamlining patient statement delivery is one of the revenue cycle management best practices since it directly addresses patient satisfaction and payment collection. Offering statements in patients' preferred methods, such as mailing, texting, or emailing, increases the likelihood of timely payments.
By simplifying and clarifying statements you make it easier for patients to understand what they owe and how to make payments. Clear instructions for payment plans also enhance the patient's ability to take action.
By accommodating patient preferences and ensuring effective communication, healthcare providers can boost collections, reduce confusion, and ultimately improve their revenue cycle management.
7. Produce custom reports as needed
The ability to produce custom reports is a revenue cycle best practice because it addresses the challenges associated with disparate systems and outdated reporting capabilities. These issues often demand excessive time and effort to piece together data for meaningful insights and trend analysis.
With a modern system like Elation Billing, generating custom reports becomes fast and simple. The platform offers access to both summarized and detailed information, with the flexibility to examine data by various time frames, filter results by key parameters like doctor, location, and essential practice KPIs.
Elation Billing also provides over 100 pre-built charts, graphs, and reports tailored to enhance your operational efficiency.
By empowering healthcare providers to make informed, data-backed decisions quickly, custom reports reduce the administrative burden associated with data access and analysis. This, in turn, minimizes frustration related to obtaining vital information, allowing practices to run more efficiently and effectively in managing their revenue cycle.
Why is revenue cycle management important?
As healthcare providers move toward value-based reimbursement and away from the fee-for-service model, the right revenue cycle management solution will become even more important for the financial sustainability of the practice.
With a goal of improved patient outcomes, you will need to optimize your healthcare revenue cycle management operations by including technological capabilities that enable you to collect data and drive analytics.
Regarding optimizing the use of revenue cycle management, healthcare providers should also ensure that the patient needs are taken into account. If the tool is not managed well, it could result in a suboptimal experience for your patient, which could impact the potential for your new practice’s success as well.
Ensuring that the patient is part of the process, in particular that there is no surprise billing, is critical for reducing costs and increasing revenue. The Brookings Institution has noted that surprise billing is associated with higher healthcare costs, so informing the patient of cost estimates and claimable expenses is important for you and your patients.
When a patient is not aware of the costs that they may be liable for, it can result in an unhappy patient who is less willing to settle their accounts.
Improve revenue cycle management with Elation’s integrated Billing and EHR solution
Elation Billing offers a comprehensive, yet simple design built for modern integrations and seamless operation with Elation’s EHR. With Elation Billing and EHR, you can optimize practice performance with unified solutions built for high-value primary care.
Whether you’re seeking fully managed billing services, or an integrated EHR and billing solution, Elation offers solutions for enterprises and small practices alike. Learn more about Elation Billing and EHR or request a demo today.
Why is revenue cycle management crucial for the financial success of healthcare practices?
In an industry with increasing financial pressures, effective revenue cycle management is essential for practices to remain financially viable, invest in quality patient care, and meet their operational expenses while providing a high standard of service.
Efficient revenue cycle management ensures accurate coding, timely claim submission, and effective follow-up on denials, ultimately maximizing reimbursement. It also minimizes revenue leakage, reduces the risk of compliance issues, and enhances cash flow for your practice.
What are the current trends in revenue cycle management for healthcare practices?
Several current trends in revenue cycle management include:
- Automation and AI: There has been an increased use of automation and artificial intelligence to streamline administrative tasks, reduce errors, and improve efficiency in tasks like claims processing and patient billing.
- Patient-centered focus: There has been more and more focus on enhancing the patient financial experience, including transparent billing and digital payment options.
- Telehealth billing: With the growing popularity of telehealth services, your revenue cycle management should ensure accurate and compliant billing for virtual care.
What are common challenges in revenue cycle management for new healthcare practices?
Some common challenges in revenue cycle management for new healthcare practices include:
A lack of experience: Inexperienced staff may struggle with billing, coding, and insurance claims.
Limited resources: New practices often have limited resources for investing in advanced revenue cycle management technology and experienced personnel.
Compliance: It can be difficult for new practices to keep up with ever-changing healthcare regulations. You must ensure accurate coding and billing to avoid compliance issues.
Managing cash flow: One challenge in RCM for new practices is managing cash flow to ensure prompt payments from insurance companies and patients.
Effective patient communication: Communicating financial responsibilities to patients clearly to collect patients in a timely manner can be challenging.