Top 5 Ways to Optimize Healthcare Revenue Cycle Management

You are currently viewing Top 5 Ways to Optimize Healthcare Revenue Cycle Management
Top 5 Ways to Optimize Healthcare Revenue Cycle Management

Discover the best strategies to optimize Healthcare Revenue Cycle Management. Explore our top 5 methods for maximizing revenue efficiency in healthcare.

Revenue cycle management remains relatively elusive in the new healthcare landscape, as new regulations and reforms have led the industry to evolve and left many hospitals scrambling to keep their revenue strong in a value-based care reimbursement model.

Today, technology platforms can play a role in assisting providers, payers, and consumers communicate and interact more efficiently, which will lead to a more durable revenue cycle management strategy. There are several key areas that revenue cycle managers could focus on to ensure their medical facility optimized their reimbursement.

“Generally speaking,  in order to strengthen the revenue cycle management, embracing technology within the revenue cycle is key,” Chad Sandefur, Director and Healthcare Analyst at AArete, told “Having the platforms to seamlessly facilitate provider-payer interactions are really integral. In many cases, it’s mostly about bad debt avoidance. With that in mind, there are a few specific points. Some of these specific five might not be the most glamourous, but certainly on the element of embracing technology, they are critical.”

Updating patients on medical billing is key

One important step to take is to train staff on patient education early in the process of treatment or medical care. This will ensure patients are not stupefied when they receive a medical bill after discharge or a medical appointment.

“First and foremost, financially clearing patients early and consistently is probably the number one element in mind. What that specifically means is that it’s trying to manage bad debt avoidance,” said Sandefur. “A lot of what we see on the front end or along the way materialize bad debt avoidance. By training staff to collaborate with patients and to educate them early, it removes the surprises when the bills come and that facilitates the payment component.”

Healthcare staff will need to be prepared to help estimate the costs of care for each medical services so that patients are prepared to pay their bills. Additionally, patients will need to be updated on any financial assistance programs they may qualify for.

Patient consumerism trends are bringing greater expectation into cost transparency across the healthcare field. Consumers are now requiring hospitals and clinics to offer real cost information before agreeing to medical services, which is a deviation from the past.

“This also includes things like estimating the costs and providing all the avenue for sponsorship for those who can qualify,” Sandefur explained. “It’s becoming more important as the way that consumerism continues to grow. It’s more than just registration. It’s more than just point of service. Once again, it’s about bad debt avoidance and financially clearing patients. That’s one element.”

Financially clearing patients is becoming an important part of revenue cycle management, as it helps hospitals and clinics avoid debt collection. Cost transparency is also an important part of improving patient communication.

“In terms of visibility, the visibility is critical. You can’t over-communicate enough. A lot of consumers are expecting that visibility. They are shopping around and managing their high-deductible plans and managing the cost of out-of-pocket services. It’s important at the point of scheduling and communication to leverage the internal staff and helps us focus on health accounts more likely to collect.”

Greater staff investment and Internet-based medical billing

“Investing in staff is important,” he said. “Basically, providing all the improvements along the way begins at the ground level. You have to have the right pulse on your team. You have to understand the processes and provide them with the right guidance whether that’s continuing education on the patient-payer communications, whether it’s on data entry, whether it’s on payer rules, or whether it’s on workflow tools that help to flag any process issues.”

“It’s important to continually educate the staff,” Sandefur clarified. “There’s just not enough education. Even in meetings or morning huddles, in terms of allowing for open communication of particular pinpoints – that’s all part of investing in the staff.”

So, “There’s ultimately increased productivity and it helps to reward high performers. Case in point, you might have the best processes in place but if those who are in charge aren’t up to speed, you’re going to see job loss.”

Allowing patients more options such as online patient payment opportunities will also lead to stronger revenue cycle management, as it would enable consumers to pay their bills much more conveniently and quickly.

“Another element involves online payment capabilities,” he continued. “When you think about the patient or the consumer, they want to have options. They want to be able to conveniently pay. When you think about embracing technology, there’s an evolution of what the revenue cycle has always done. Five or six years ago, we were concerned with how to make the bills easier to read and understand. Now the payment mechanisms have accelerated in terms of text messaging or easy online payment capabilities.”

“There must be about 40,000 different healthcare apps and some of those apps allow you to easily find a doctor. In order to anticipate how to make these online payment capabilities put into the hands of the patient, we have to keep up with that online payment technology,” Sandefur concluded.

Utilize data analytics to obtain a clearer picture of the revenue cycle

Revenue cycle analytics and utilizing financial data is key to make the revenue cycle more visible through charts or graphs. Dashboards and robust reporting are advised for optimizing healthcare revenue cycle management.

“From a provider’s point of view, it begins with dashboards for reporting and key performance indicators to monitor the transactions for payment denials and revenue management,” he explained. “More importantly, using the analytics to internally see whether our staff is focused on the things that they should focus on. Ultimately, you can’t manage what you don’t measure.”

“We use analytics for predictability – whether that denial or that payment is based upon a particular code, particular specialties, particular locations, or particular accounts. What we see with analytics now is not just a rear view mirror look but ultimately, when you think about machines, we have a specific team of data scientists.”

In order to better manage the revenue cycle, measurements and data analytics will be a necessity. KPI monitoring to track the health of the revenue cycle is also important.

Improving likelihood of patients paying their bills

One way to improve revenue cycle management is to target the patients with a history of timely payments. This could also lower the cost burden on the hospital or clinic. Propensity to pay tools are advised, as these technologies could leverage credit scores and other financial data from a consumer’s spending history.

“The fourth element is about leveraging patients propensity to pay. It ultimately looks at increasing the likelihood for our staff to anticipate where we’re going to have collection issues,” he mentioned. “Whether we’re targeting patients that have a history of being frequent flyers, we’re going to need to be more timely in terms of recognizing whether we need to allow them the right financial counseling or whether we couple the predictability of payment around their credit scores.”

“We see clients working with third-party payers. We see clients that work more specifically with their own hospital-specific information. Ultimately, the idea is to leverage credit scores and leverage our experience so that we identify upfront where the hiccups and troubles will be and, ultimately, we embrace the best practices that allow us to embrace technology,” he concluded.

View and update processes on a regular basis

For optimal revenue cycle management, it is important to revisit daily processes to ensure everything is working smoothly. Even though there are many other work-related performances taking place on a day-to-day basis and it may be easier to address issues once they begin cropping up, it is safer to optimize revenue cycle management through a preventive approach by checking on and updating technological processes on a regular basis.

Cross-departmental task forces or strategy groups can help hospitals optimize their revenue cycle management, Sandefur said. If denial rates are too high, it is helpful to form a recurring group to find the causes and determine a solution. Meetings will need actionable items and goals to be more productive at strengthening the revenue cycle.

Leave a Reply