Should You Be Outsourcing Revenue Cycle Management?
Revenue cycle management seems to get more complex by the day. Tight margins, shifting care paradigms, increased emphasis on technology, and a burgeoning emphasis on patient responsibility are among the many factors putting intense pressure on healthcare coders and billers to keep up with demands, minimize denials and keep revenue flowing.
“The overall revenue cycle management process has become so complicated,” says Michelle Durner, president of the Healthcare Business Management Association. It’s also extremely labor-intensive. And to manage it inhouse, practices must train workforces to optimize complex IT tools, a prospect that for most is at least daunting, if not unreachable.
No wonder that “as hospitals and physician practices grapple with intense pressure to optimize revenue cycle management processes, outsourcing has emerged as a powerful solution to the challenges of a rapidly changing healthcare model,” says Doug Brown, Managing Partner of the healthcare research organization, Black Book.
A dozen issues
Here are 12 reasons to consider outsourcing revenue cycle management in 2018:
- Patient payment shares have grown dramatically, now accounting for 35% of provider revenue. In 2000, patients were responsible for only 5% of healthcare provider revenue.
- The time it takes to collect from patients has also been growing: 73% of providers say it takes a month or longer to collect from patients. On top of that, the longer a patient’s balance remains unpaid, the harder it is to collect. At fewer than 30 days, the odds of collecting are over 97%, says the Healthcare Business Management Association, but the odds drop to 60% after 60 days.
- With deductibles having gotten so much higher, providers are forced to spend more time tracking total out-of-pocket amounts paid by patients to date. And since the advent of the Affordable Care Act, constant changes in enrollment status have made it harder and harder to do so.
- Evidence suggests that insurers are more tightly enforcing their medical policies and putting greater focus on medical necessity. For example, in the third quarter of 2016, 81% of Recovery Audit Contractor denials were based on documentation and medical necessity factors. These have led to higher costs for providers, and a need for additional resources.
- Once claims are denied, only about two-thirds can be recovered. But about 90% of claim denials can be prevented.
State, federal and carrier requirements are fluid and subject to constant change. A practice that doesn’t have the resources to keep up with the pace of change can easily run into compliance problems that negatively affect cash flow. Outsourcing can provide consistent billing practices and improved audit compliance.
- The advent of value-based payment models has substantially increased the complexity related to clinical documentation, resulting in the need for regular retraining of RCM staff. For example, risk-adjusted revenue from Medicare forces payers and providers to document the acuity of patients’ conditions. That requires greater emphasis on documentation accuracy.
- Relatively few practices have the resources and IT systems needed to keep pace with all evolving training requirements.
- Likewise, the implementation of ICD-10 requires coders to be more nuanced and detailed in the documentation of claims.
- Growing complexity and lack of complete understanding of documentation on the part of many doctors can force coders to use lower-acuity or non-specified codes, resulting in more denials and less revenue. Outsourcing RCM can help doctors’ better understand revenue cycles by providing transparency and the opportunity to interact with experts.
- When revenue-cycle management is outsourced, staff members can focus on healthcare-related issues instead of getting bogged down in routine billing tasks.
- Outsourcing can promote peace of mind by providing transparency, by ensuring HIPAA compliance, and by implementing secure billing processes that protect data confidentiality.
- Since revenue cycle management involves complex interactions with both patients and physicians, any sort of mismanagement can reduce both patient and physician satisfaction scores (in addition to hurting cash flow).
Revenue cycle management is too important to entrust to anyone other than a group that fully understands and can manage every aspect of the process.
QueueLogix provides customizable solutions that manage the increasing complexities associated with RCM. You’ll be able to connect all backend business processes with frontline patient encounters in real time, so, for example, symptoms will be diagnosed and coded simultaneously. And patient exams, documentation, and billing procedures will be integrated into a system in which information is not only executed efficiently, but also rapidly double-checked for accuracy, to eliminate potentially costly mistakes.
In short, the safe, efficient and intelligent revenue cycle management provided by QueueLogix is designed to ensure that your practice collects all the revenue it’s due, and does so as expediently as possible.