With the rapidly-changing patient care landscape and a shift toward delivering health services more efficiently, clinic owners and hospitals are increasingly looking to find solutions to help them manage this transition. One of the major areas they are focusing on is revenue cycle management (RCM) solutions. In fact, according to a study by MarketsandMarkets, the sector could reach more than $90 billion by 2022, nearly doubling in size from its 2017 levels. But what does this mean, and what will the future look like for these providers when it comes to collecting payment?
First off, it’s important to understand the value that RCM solutions provide – especially within the context of claim denials. According to EY, 15-20 percent of the nominal billing value of claims submitted in the U.S. are denied – whether it’s for technical issues, authorization, documentation or medical necessity. Not surprisingly, when you add up these numbers, they create quite a picture. A study conducted by the Advisory Board in 2017 showed that improving revenue cycle management could increase revenue by up to $22 million for the average 350-bed hospital.
To manage these revenues more effectively, medical facilities are looking toward trusted RCM partners. While each business has their own unique goals and vision, there remain some relatively universal requirements for RCM providers, such as:
- ROI, ROI, and ROI: Seemingly the most important thing when it comes to an RCM solution is how soon it will deliver financial results. Considering the capital outlay that these offerings require, it’s understandable. According to Black Book Market Research, “Healthcare providers will have no choice but to evaluate and optimize their RCM solutions end-to-end in a future state that leverages analytics and enhanced connectivity with payers, all keeping pace with the advances in healthcare technology.”
- Understanding Payer Rates and Regulations: The rules for payments are continually changing. This can include anything from filing limits to fee schedules to what authorizations are required. Rather than dedicating resources (personnel and financial) to keeping track of all these updates, an RCM partner monitors all these changes and implements them so you can deploy your budget most efficiently.
- Staff Training: RCM solutions are highly technical. In that, you need to ensure that your partner offers training to help your staff understand all the intricacies, or you risk not billing correctly or properly entering patient data. As RevCycleIntelligence notes, “Coding errors can equate to medical errors,” meaning unnecessary expenses in the form of penalties.
- Meeting growing patient responsibilities: Patients’ financial responsibilities seemingly increase every year. This is why it’s even more important to collect insurance payments quickly and accurately. An RCM partner can help to ensure that balances can be forwarded to the patient as expediently as possible.
- A meaningful financial policy: When it comes to billing and collection, it’s important to have a well-articulated and enforceable policy in place. According to the American Health Information Management Association, policies should offer guidance on collections, patient responsibilities, charity care or other payment options.
With policy changes, technological advancements and changing patient needs, the healthcare industry itself are undergoing significant transformation. Because of that, facility leadership will need to be mindful of ways they can maximize revenue opportunities and function with better financial efficiency. Working with a trusted RCM partner can get you on that path.