Insurance claims from private and govt. The typical medical practice is less effective when it comes to managing external revenue drivers, including payer reimbursements, patient payments and collections.
Managing the Revenue Cycle: By Tony Ryzinski View Comments 0 Print Article As we enter the second decade of the 21st century, medical practices face a host of financial challenges.
The unknowns of healthcare reform, changing reimbursement and rising bad debt from the uninsured have introduced a multitude of pressures and uncertainties. Whether your practice aims to maintain physician compensation at desired levels, keep up with overhead expenses or invest in new technologies, the critical factor for success is efficient management of the revenue cycle.
Background The revenue cycle comprises the numerous tasks of the billing and collection process - namely, gathering and entering data about professional services rendered, and ensuring that bills are paid in full.
Think of the medical practice's revenue cycle as a wheel. The spokes are the critical functions of the billing and collection process. Each function has several key touch points, often in the form of tasks, that practice staff or providers must perform.
Unless each function is performed effectively, the wheel will fail to turn. If it stops for too long, the business will collapse.
These critical billing and collection functions and their related touch points with providers and staff include: Managing and monitoring reimbursement agreements with government and private payers. Eliciting and processing patient information: Scheduling and confirming appointments as well as referrals, registering patients in the practice management system, verifying insurance, obtaining pre-authorizations for treatment, and other tasks.
Logging all services provided to patients, correctly coding services, providing required documentation and other tasks. Producing and submitting claims to payers and sending statements to patients. Posting payments, handling denials by insurers, and adjudicating accounts.
Monitoring performance and resolving or appealing payer denials. Determining and collecting what patients owe, administering financial policies and receiving payments. For each function and related touch point, a medical practice establishes and assigns the administrative functions that must be performed.
Unfortunately, many medical practices do not take firm control over each of these many wheel spokes. Opportunities to interact with patients and payers are missed and, as a result, the revenue cycle does not operate at peak efficiency.
Here, we'll examine 10 key opportunities where many medical practices can streamline their revenue cycle. In doing so, they will be better able to bring in cash faster and with less effort. You will clearly see the financial outcomes in the bottom line: Each major function in the revenue cycle has responsible parties: Everyone in the practice has a role - often several roles - to play in managing the revenue cycle.
When the wheel of the revenue cycle slows or snags, it may be because responsible parties fail to understand their roles. Other times, a poorly designed function is to blame. Perhaps the practice doesn't provide staff with the tools to carry out the function, or misplaces the task in its workflow.
While dozens of steps can speed up the revenue cycle and avoid missed collections opportunities, here are the 10 most common prospects for improvements. These will, in the long run, produce accurate and compliant billing and ensure that your practice collects what its physicians have earned.
Recognize Where the Cycle StartsThe revenue cycle starts as soon as the practice defines the terms of its relationship with an insurer - or the practice's policy regarding patients who have no healthcare coverage.
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