So you'd like to understand revenue cycle management? Congratulations, it's extremely important as we move into value-based reimbursement scenarios. To understand how and why you are currently losing money in revenue cycle management, it's best to understand what revenue cycle management is and what it is not.
Most CFOs, practice administrators and finance leaders believe that revenue cycle management, at its core, is claim submission, payment posting, denial management and collection. What I've actually just described is billing. That is a component, a small component, of revenue cycle management.
To better understand exactly what revenue cycle management is in totality, let's take a look at what the HFMA has to say about revenue cycle management. Revenue cycle management includes all the administrative, clinical functions that contribute to the capture, management and collection of patient service revenue. Think about that for a minute, everything that contributes to patient service revenue is included in revenue cycle management. When you start pondering that you begin to realize just how little you are paying attention to a great many factors that are impacting your bottom line. Far too many CFOs, CEOs and administrators believe that revenue cycle management and billing are interchangeable terms. They are not and that belief is costing you money.
The second area where you are losing money as it relates to revenue cycle management is living in the past. Ask yourself this, "Is every single one of the people coding our charts and encounters certified?" Clinicians have to keep up their CEU credits every single year shouldn't your coding and billing staff have some sort of a benchmark with which they're measured and certified, and shouldn't they keep that up every single year? What is this costing you, by the way, they they're not doing that in time, productivity, and growth. So when I say you are living in the past, you have had people performing these tasks for years, but are they up to the current standards? Do they understand the local nuances, the state requirements, the federal things that are changing monthly? That's what we're worried about for you.
The third reason why you're losing revenue. These are some softball questions all right? How many charge masters do you bill from? Hint: if you answered more than 1, you're doing it wrong. And it's costing you tens of thousands of dollars and we see this every single day. It's also exposing to potential audit. Question two, do you really understand "incident to billing?" Here's another area where we see mistakes all the time and it really is putting the practice and the organization in potential peril. Softball question number three, when a denial is received, do you take the insurance company's word as gospel? Or do you aggressively work that denial and appeal and appeal and appeal? Do you have the resources for that kind of aggressive appeal? Or do you merely have an aggressive adjustment policy where you right that off and send it to A/R and you hope that they collect it. Question number four, how successful are you at no-show prediction. Do you have a 99 percent accuracy at predicting when patients are going to show up? Think about what that capability would give you. Think about the power you would be able to have and the lack of lost productivity due to patient no shows. These are several of over 50 some odd questions you should be asking each week, because I promise you not knowing these is costing you time and money.
And closing, I'll leave you with this tip. Never ever sign a 5 year agreement in healthcare, ever. You should never sign a 5 year agreement for revenue cycle services, in fact as you move into the value-based care environment, the only time you should sign a 5 year agreement is if the company presenting that agreement is willing to put, in the form of money in your pocket upfront, risk payments based upon their performance. So if you are a CEO, CFO, CBO, practice manager, physician that wants to substantially increase to your revenue, the place to begin is a thorough understanding of revenue cycle management and everything that it entails. If you have any questions, please feel free to leave them in the comments section and we will be happy to get back to you. Thanks so much.