Healthcare organizations serving patients have a fundamental agenda of maintaining the system of patient care in an organization. Hospitals, today, introduce various patient care services in an organization to stay financially fit in the system and one of those services is RCM. A Revenue Cycle Management (RCM) is a financial administration which helps hospitals to be efficient with their finances and patient service.
A Revenue Cycle management manages revenue vital for hospitals by providing patient care services through outstanding payment management with the help of medical billing software and insurance companies.
An RCM cycle starts when a patient communicates for an appointment in a hospital and ends when all the claims and services have been fulfilled. The healthcare organization holds the responsibility of putting up with all the variations in an RCM cycle. The process needs to be precise in all the aspects of the cycle so as to effectively handle the finances of the organization which at times can be a big burden.
Financially clearing a patient is an outline, inside which hospitals work because clearing the payment swiftly eliminate the organization from the burden of debt compilation in the future. For a better value-based reimbursement, revenue cycle incorporates both the administrative as well as the clinical function into one. The aim behind is to make sure that healthcare providers (practitioners and professionals) can get paid for the services furnished as early as possible.
How does a Healthcare Revenue Cycle Work?
Before diving into what’s and how’s of the RCM plan, one must be aware of the various phases it takes to reach those answers. The process of submission of a claim and reimbursement can be quite complex if any of the following steps are ignored, to the extent that of full denial of the payment can incur.
# Stage 1 – In-house RCM software VS Outsourcing Medical Billing
The RCM cycle is evidence of acceptance and development of technology in the healthcare industry. To begin with, you must be aware of the fact that every hospital has its own revenue cycle plan. Based on the size, capacity, and services provides, etc., an organization develops its Revenue Cycle Management plan on whether to go for an In-house plan or outsource the management of the medical billing and verification on the IT professionals by outsourcing to reliable IT companies.
It is always advisable for the big healthcare organizations to opt for a third-party expert as it gives them more time to focus on patient care.
# Stage 2 – Pre-authorization
After selecting the type of medical billing service, a biller now is responsible for pre-authorization and verification of medical plans, procedures, and equipment as well as patient’s details.
A good revenue cycle is identified by how well the front-end RCM is managed. This includes instantaneous steps taken by the medical staff. The staff must ensure proper arrangement of a patient’s appointment, his insurance eligibility, scheduling and setting up of his account.
The front-end carries the most crucial responsibility in the RCM. It is the first step of recording and scheduling a patient’s details which later on becomes the groundwork for billing and claim submission by the insurance companies.
# Stage 3 – Proper Coding of ICD-10