As we all know, Revenue Cycle Management is one of the key things for Hospitals, EHR companies and Medical Billing Companies. It is also considered as the most complex tasks in that segment. That’s one of the main reasons they outsource this aspect of their business to expert companies.
But the challenge is how to identify the best RCM company? This is where this article will take you through the 8 easy ways to choose the best RCM company. The following steps will be very helpful for doctors, hospitals, EHR providers and for those who are looking to outsource their medical billing. Before we get into details, let us first understand what is revenue cycle management(RCM) and how it functions.
What is Revenue Cycle Management?
The term revenue cycle management is mostly associated with the medical claims by the hospitals and doctors for the service provided by them to the patients. In other words, Revenue Cycle Management or RCM is a process through which the medical practitioners and hospitals identify, verify and collect the payments from the patient’s insurance companies who have taken services from them.
How does Revenue Cycle Management(RCM) work?
RCM or Revenue Cycle Management goes through a series of process. However, the process and the number of steps vary from company to company. But in general, majority of the RCM process works in the following ways.
Health care provider verifies the patient’s insurance plan and informs the patient on which services that will be covered and not covered in the existing insurance plan.
The next step is where the real action takes place. This is where the patient actually takes the treatment in the medical set up and checks out after the treatment. After this, a detailed report relating to the patient and the treatment will be sent to the medical biller.
Now the medical biller prepares the claim and checks compliance. Billers should ensure that the claims submitted follow the standards of billing compliance.
According to Health Insurance Portability and Accountability Act of 1996(HIPAA) all medical claims have to be submitted electronically. Of course, there are some exceptions where the insurance companies asks for a manual claim form to be submitted.
Next step is called as adjudication. This is when the claimant will know how much amount can be claimed and so on. In some cases, the claim also gets rejected partially or fully depending on the scenario.
Now the biller will prepare a statement for the patient with details of the amount that can be claimed and not claimed.
The final stage in RCM is the balance payment collection from the patient. This can be done through proper follow up with the patient.
Now you would have got a basic idea on how revenue cycle management works in a healthcare company. It’s time to know the 8 easy steps to choose the best revenue cycle management companies. The following steps will be very helpful for medical practitioners like doctors, hospitals, EHR providers and for those who are looking to outsource their medical billing.
Let us now look at the steps one by one.
Step 1: Presence of the Revenue cycle management company
The first and foremost step in choosing a RCM company is to know the age of the company. Any RCM company that you are looking for should have been in the business for a minimum of 5 years. More the number of years more the experience and expertise.
Let us take an example of company ABC with 8 years in the field and company XYZ with 2 years of experience. It is very obvious that ABC company would have seen more cases compared to XYZ. When a company is there for long, the advantage is they will be knowing the old and the new procedures. So you can pick your RCM company based on this criteria.
Step 2: Check for the ISO 9001 Certification of the RCM company
Another way of checking the RCM company is to know whether they are ISO 9001 certified? Why should we know the certification of the company? ISO 9001 certification is given for quality standard maintained in processes of an organization.
This is a very critical aspect that you should look for. The reason being, medical claims involve a lot of processes and procedures. Since ISO 9001 certified companies follow standard procedures in their work process we can be sure that they have a structured process in place.
Step 3: Clients of Revenue cycle management company
The next important criteria for shortlisting a revenue cycle management company is to understand their client list. You will have to check for the quality and quantity of their clients. Quantity of clients refers to the number of clients they have served. Quality of clients refers to the type of clients served.
You will have to understand the spread of clients in terms of client size, client type and geographical area. For example, if you belong to a group of doctors who practice in the same premises, then look out for a RCM company that has served similar kind of a setup.
This indicates that they have more experience in serving these kind of clients. So it’s easier for them to serve you better compared to a RCM company that has more of big hospitals in their portfolio.
Step 4: Check for the HIPAA standard
The Health Insurance Portability and Accountability Act (HIPAA) relates to the standards in protecting the patient data. Why is it important? This is really important from the patient’s point of view that their personal medical data is safe.
Hospitals and medical practitioners have the responsibility to safeguard the data of the patients. So when you are choosing a revenue cycle management company, we need to check whether they are compliant to the standards set by HIPAA.
Step 5: Claims ratio of the RCM company
It is difficult to find out or get the data on the number of successful and rejected claims of a RCM company.In general, most of the companies will be reluctant to share about their rejected claims. Some companies may even have more rejection cases due to an issue from the patient side. So it is difficult to get this information. But during discussion or negotiation stage we can always ask them on this aspect. If they are confident and open to share these details, then you can shortlist them.
This is another major factor to consider before choosing the revenue cycle management company. You should always be aware of the team behind the company. Team here refers to the top level management and the support team involved.
It is very important for us to know their vision and their geographical locations. If possible we should also be able to know the team’s qualifications and their experience in this field. This will help us to know whether they have the right kind of people to serve you.
Step 7: RCM company charges
Most of us think, this is the key parameter before zeroing on a RCM company. To be honest, if the chosen company can deliver what is promised and can help you to function smoothly, then pricing should not be an issue.
Say for example, we choose a company based on their pricing ignoring other parameters mentioned above, then mostly we may end up spending lot of time explaining and following up on things. This will defeat the very purpose of outsourcing your medical claim. It is important to keep your budgets tight when you outsource things. At the same time we should not compromise on the quality of service.
Another important aspect that needs to be checked is the support system of the revenue cycle management company.We need to check on how their support system works. We have to ensure that the company is process driven and not person driven.
The reason being, process driven companies drive on their own. If it is a person driven scenario, then the work comes to a halt if that support person leaves the organization. Till the new person understands the system and this particular case lot of time will be lost. So it is important to choose a RCM company that has the best support system in place.
New Avenues in Revenue Cycle Management in 2021:
Automation technologies like artificial intelligence and machine learning has made its way to the daily workflow management of revenue cycle. Increased numbers of healthcare companies are now investing in these technologies to improve their collections and decrease denials.
- Software Tools:
Software tools are taking the load of manual processes of revenue cycle management like payment posting. This has helped the healthcare organizations to cut back the errors due to manual posting by about 60%. While some organizations have moved ahead with end-to-end RCM software tools, some are still starting off with one responsibility at a time.
- Data Tools:
Healthcare organizations are trying to improve their financial performance with the help of data tools that can collect and analyze loads of information to produce specific reports. In fact, some of the tools also help the healthcare organizations to get a view of accurate future scenarios with different paths of revenue collection.
You can get the benefits of all these features without having to invest too much if you choose the right revenue cycle management company for your organization. Make sure you follow the steps to get the best out of their services.
All the above mention factors are some of the major factors to consider. However, there are also lot of other not so critical parameters that can also be considered. If you could comment with some more parameters, we will be happy to include it provided it meets the standard guidelines of our blog. If you find this article interesting, you can share it with others. Thanks for reading. Keep watching this space for more updates on medical billing and RCM.