In the highly regulated and fast-paced environment of healthcare, making sure your practice secures revenue and reimbursement should be top of mind. However, this task shouldn’t be needlessly difficult and time-consuming. Thankfully, revenue cycle management (RCM) support services can help fill in the gaps in your administrative billing processes, so you can focus on what really matters, patient care.
Revenue cycle management can be time-consuming for your staff, which is why partnering with an RCM support provider can alleviate pressures associated with tasks like eligibility, authorization, billing, claims submission, denial management, accounts receivable, appeals, and more. Considering that these processes should be as buttoned up as possible, it’s no wonder why 75% of health systems deployed RCM support solutions during the COVID-19 pandemic.
When your practice leaves money on the table, the result is a poor financial condition, a stagnated business, an unhealthy working environment, and unhappy patients.
You Could Be Losing a Lot of Money
A poor financial condition is the most obvious byproduct of poor RCM. In fact, you could be losing up to 20% of your practical income due to flaws in your billing process. This is especially true as the highly regulated healthcare industry becomes more and more expensive for the average patient, and as high-deductible plans become more popular.
Losing revenue for services rendered, and challenges associated with securing reimbursement, have punched a hole in the side of healthcare providers’ operations, causing massive hemorrhaging in revenue streams across the spectrum. The average 250-bed hospital reports up to $11 million in lost revenue due to errors in coding and clinical documentation.
According to a 2018 study, more than three-quarters of hospitals surveyed said denials are the biggest challenge they face within their RCM. If an insurance company refuses to pay, the responsibility falls on the patient. Each denial increases your chances of not getting paid.
All these factors can contribute to bad debt, something that is rising in the healthcare industry. Some studies suggest that over a third of practices face bad debts totaling over $10 million. For many, the chances of ever recovering bad debt are extremely low.
No Money, No Growth
Without a robust RCM process that ensures you get paid in a timely manner, your practice will have a hard go at investing in other business areas.
A poor RCM process also means you are probably spending much more than you need to. When a clean claim is not submitted, you pay the price, as studies show the average cost to rework a claim is at least $25. And it’s not just the re-submission fee you have to worry about, you’ll also have to pay your administrative or billing team to rework those claims as well.
If the patient does not pay, then you will have to spend even more time and money dealing with collections, which can take months or even years to resolve.
Some studies suggest that hospitals are missing out on millions thanks to inferior revenue cycle strategies. Money that could be used to add new personnel, purchase new technology, expand into new locations, and more.
With RCM support from a trusted technology provider, you can scale your practice without having to employ additional in-house coders and medical billers.
You Risk Overworking Your Staff
Let’s face it – when your practice is not financially stable, expenses get tight and morale drops. This is a recipe for stress throughout your entire organization. On a more granular level, a poor RCM process and a disconnect between departments can give your administrative staff even more reason to resent coming to work.
The RCM process is one of the few processes that transcends both front-end and back-end operations. Front-end administrators register new patients, collect insurance information, and perform important prior authorization and eligibility tasks, while back-end billing teams submit and manage claims, denials, and collections.
When an organization’s RCM process is disjointed and the front- and back-ends do not work in synergy, your staff will have to spend more time rectifying mistakes. On average, it takes at least a month for the typical practice to close a bill on patient services that are self-paid. To say that your administrative team is already overworked would be an understatement.
Some studies suggest that the workplace environment is causing 80% of the burnout among medical professionals, with system-generated issues being the leading reason for day-to-day stress. Mountains of paperwork, long hours, and unrealistic productivity demands – all products of a poor RCM process – also contribute to that stress.
The Patient Experience Suffers
Healthcare professionals, like yourself, know that the cost of healthcare will continue to rise, as is patient financial responsibility due to an increase in high-deductible plans. Because of increased costs, patient experience expectations have skyrocketed. Don’t let a disconnect in your finance department derail your efforts to boost the patient experience.
No one wants to be surprised by ‘hidden’ medical costs, especially when those hidden fees are a result of poor clerical processes. Unfortunately, prior-authorization and eligibility mistakes directly contribute to an increase in out-of-pocket costs for patients, especially as high-deductible plans become more popular and insurers are responsible for a significantly smaller portion of the bill.
The average U.S. family now spends about 11% of their income on healthcare, and a quarter of those expenses are attributed to co-pays, deductibles, and other out-of-pocket costs. Patients are becoming more responsible for their healthcare costs, and hospitals with better patient-paid expenses are generally more profitable.
According to the U.S. Census Bureau, a shocking number of Americans cannot afford to pay for their medical care – nearly 20%. That means one fifth of your patients may not pay their bill… ever.
Given these trends, practices should do everything in their power to communicate patient responsibility when it comes to service costs. The more transparent you are with your patients, the better chances you have of getting paid. Your patient should know just how much their care will cost them, before ever stepping foot into an exam room, and that is something an enhanced RCM process can help you with.
Ready to Boost Your RCM?
If the previous problems sound all-to-familiar, then you should seriously consider investing in RCM support designed to take some or all of the burden off your shoulders. Professional RCM services provide you with billing and claims support to ensure you get paid quickly.
RCM software can also automate many of the tasks you’re already performing. Tasks like appointment reminders, payment reminders, managing claims, ensuring clean claim submission, and tracking and re-working denials.
Software can be used as a standalone solution, or it can be integrated with your Electronic Health Records (EHR) system to provide a more comprehensive view of the patient journey, from intake to treatment to payment.
RCM software can also assist in storing and managing patient billing records to potentially reduce the time between service rendered, billing, and reimbursement. This is done by providing you with a more detailed look at patient populations.
In an industry where margins are already thin, you need to be doing all you can to ensure reimbursement and clean claim submission. When you spend too many resources on the bare minimum, you place stress on your practice and detract from the patient experience. Discover how an RCM partner can elevate your practice today.