RCM in Medical Billing: 7 Best Practices You Must Follow

Significance of RCM cycle in Medical Billing

Revenue cycle management medical billing starts with patients scheduling appointments for healthcare services. The patient is registered on the system, and all the information is stored as electronic health records. The patient payer data is then gathered for verifying the patient’s identity and assigning a payer source. After the patient visits the doctor, the payment is entered into the system for revenue cycle automation. RCM in healthcare helps to track and automate the payment reimbursement process.

The revenue cycle process in healthcare enables the collection of the charges for all the RCM health services delivered. Revenue cycle management medical billing automation ensures the payer reimburses on time and manages insurance pays without delays. The bills are stored electronically in the system while implementing RCM in medical billing. In this way, medical billing in revenue cycle management smoothens the billing and payment process and manages the entire revenue cycle. It also serves useful while tracking and receiving payments from telehealth services and remote patient monitoring.

Common challenges in RCM

Let’s take a look at the common challenges in hospital revenue cycle management:

1. Errors in Coding 

RCM medical coding errors, like incorrect diagnosis or procedure codes, can lead to claim denials, payment delays, and audits. To mitigate these issues, it’s crucial to ensure thorough documentation and provide ongoing coder training.

2. Delays in Insurance Claim Reimbursement

Insurance claims reimbursement delays can be caused by several factors in insurance claims analytics like payer processing times, rejections, and inaccurate submissions. To mitigate these issues, streamlined billing processes, claim optimization, and technology solutions can be implemented.

3. Adherence to Compliance Standards

Healthcare practices must adhere to regulatory standards like ICD-10 coding, HIPAA privacy rules, and healthcare billing regulations to avoid penalties, audits, and legal issues. Regular staff training, regular audits, and robust compliance programs are crucial for maintaining compliance in RCM billing services.

4. Insurance Denials

Insurance denials in medical RCM services occur when healthcare providers are denied reimbursement for claims due to various reasons like incomplete information, eligibility issues, coding errors, or lack of medical necessity. To manage these denials, timely appeals and root cause analysis are necessary.

5. Generating Timely Reports

Healthcare providers are required to submit reports to regulatory agencies, payers, and stakeholders for quality reporting, performance measurement, and reimbursement. However, generating accurate and timely reports can be challenging due to data collection, formatting, and submission requirements. Implementing reporting tools can streamline reporting processes.

Features of Revenue Cycle Management

1. Patient Registration

Accurate patient registration is crucial for verifying insurance eligibility, determining coverage, and facilitating billing and claims processing by capturing patient demographics and insurance information. 

2. Claim Submission

Healthcare providers submit claims to insurance companies or third-party payers for reimbursement after providing services and recording charges. This process involves compiling patient and service information, completing claim forms, and transmitting claims for processing.

3. Services and Charges Capture

Healthcare providers must meticulously document and record the services provided to patients, including diagnosis codes, treatment details, and interventions, and assign appropriate billing codes for reimbursement purposes in RCM medical billing software.

4. Denial Management

Denial claims management involves identifying reasons for denied claims, appealing them, and resolving payment discrepancies. Healthcare providers must analyze trends, address root causes, and take proactive measures to minimize future claim rejections.

5. Payment Processing

Payers adjudicate claims by reviewing submitted information, verifying coverage, and determining reimbursement amounts. Payment processing involves receiving and posting payments from insurance companies, government payers, patients, or third-party entities, either electronically or via paper checks.

What Advantages Does an RCM System Offer?

Here’s a detailed look at the advantages RCM brings to healthcare organizations:

1. Increase in Collections and Revenue

In revenue cycle medical billing, healthcare facilities face numerous expenses, including patient services and staff salaries. Delays in payments due to denied claims or patients’ inability to pay upfront can hinder expense management. Medical billing in RCM helps identify claim denial patterns, enabling practices to prevent future denials and receive timely reimbursement. By recognizing these patterns, healthcare facilities can better manage their expenses and ensure timely reimbursement for their services.

2. Better Patient Experience

Effective RCM healthcare services improve patient experience by providing comprehensive, targeted healthcare and simplifying processes like scheduling, intake forms, and billing. It also emphasizes thorough insurance verification upfront, ensuring patients understand their eligibility and avoid out-of-pocket expenses. This approach reduces readmittance and ensures a more satisfactory experience for both patients and administrative staff.

3. Streamlined Processes

RCM healthcare solutions can be improved by providing a secure and straightforward solution for physicians, office workers, coding specialists, and other revenue touchpoints, thereby reducing errors and reducing staff confusion.

4. Reduced Administrative Burden

Revenue cycle management in medical billing streamlines administrative tasks such as scheduling appointments, updating patient information, and verifying insurance for patients. This system ensures accurate completion of these tasks, preventing future claims from being denied, and saving administrative staff time by avoiding the need to investigate and appeal denials.

7 Best Practices for RCM in Medical billing to double up the ROI  

Physicians are slowly adopting healthcare automation practices, be it for virtual care or integrated care. In such times, healthcare practitioners must incorporate the best methods for increasing their capital through an RCM solution.  

We have created a list of top 7 practices for healthcare revenue cycle management to help you achieve high ROI returns.   

1. Implement Patient-centricity  

Medical practices need to utilize revenue cycle solutions for maximizing their income and improving healthcare management. The staff should work proactively towards enhancing patient engagement to build trust and high patient outcomes. Healthcare providers must offer a verbal and written explanation to patients regarding their financial responsibility, payment options, and expectations from their visit through revenue cycle management. A doctor’s time and effort need to be focused on patients and should not reflect the struggle to generate more revenue. Patients may think of the revenue cycle management process in medical billing as confusing, complicated, and challenging. Medical professionals can address these concerns and encourage patients to use online payment and billing with RCM solutions.  

2. Incorporate interoperable systems  

Interoperability forms an essential ingredient of medical revenue cycle management software. It simplifies the communication of patients’ medical information across different healthcare networks securely. Interoperability in revenue cycle management solutions supports interconnectivity and simplifies workflow between multiple healthcare providers. Interoperable medical billing solutions allow electronic data exchange and healthcare analytics across various systems and devices for automating billing management and ensuring HIPAA compliance.  

3. Know about patients’ balances  

While implementing RCM management in medical billing, it is essential to be aware of patients’ balance payments. Any pending payments must be handled immediately with medical billing solutions. The best way to accomplish this with revenue cycle management in healthcare is by collecting patient balances during check-in and check-out of hospital visits. Collecting payment from patients is likely to reduce when they leave the clinic and would continue to drop with each passing day. RCM in medical practices enables tracking of patient balances to help healthcare providers receive timely payments. 

4. Automate insurance validation  

Verification of insurance coverage during patient registration is an essential step while integrating RCM in medical practice. More and more insurance companies establish stringent requirements for prior authorization software and coverage eligibility with revenue cycle management. Automation of insurance verification using medical revenue cycle management can optimize clinical processes, speed up payment reimbursement, and reduce the workload of the administrative staff. Automating insurance verification with RCM in medical billing can also avoid claim denials.

5. Adhere to compliance standards  

Healthcare organizations must comply with HIPAA standards while delivering care services, be it virtual or offline. HIPAA regulations make it compulsory for all healthcare providers to submit claims electronically with an approved format for managing the revenue cycle in medical billing. Paper works for record-keeping can lead to errors and miss the accuracy demanded by HIPAA. Healthcare professionals can protect patient medical records’ privacy, security, and confidentiality by adhering to HIPAA regulations. Revenue cycle management in healthcare promotes HIPAA compliance along with the accurate filing of medical billing documents.  

6. File claims on time  

One of the common mistakes that healthcare organizations make is failing to file claims promptly and missing deadlines. Healthcare revenue cycle management companies allow one year for filing of claims starting the date of healthcare service. In contrast, private insurance companies allow only 90 days. If you miss the deadlines for submitting claims, they may go unpaid, which can affect your RCM in medical billing. In such cases, the healthcare provider would need to write off their clinical services. We know you wouldn’t want this to happen, so filing medical claims on time is crucial.

7. Manage claim denials  

Claim denials are a common reason why many healthcare practices lack an RCM in medical billing management. Claim denials may be faced for several reasons, such as coding error, duplicate claims, lack of information, missing deadlines for claim filing, and so on. That is why it is essential to closely monitor the claim process. Revenue cycle solutions can help you understand each claim and identify why claims are denied. RCM in medical billing can enable your staff to recognize the patterns and mistakes so you can prevent claim denials. It can assist in tracking denials and the reasons for them so you can manage claim denials better. A denials prevention program in medical billing should be implemented for the entire staff to focus on standardized processes for mitigating denials risk.

Conclusion  

Investing your time and money in RCM for medical billing can be a long-term plan for managing billing and claims. The above best practices for RCM software would streamline your healthcare revenue cycle and help you make the most from it. These seven best practices can increase cash flow, reduce account receivables, decrease expenses, and streamline the workflow of your healthcare practice. OSP can develop RCM solutions that cater to the best practices and help you achieve your medical billing goals.