Revenue Cycle Management (RCM) is defined as the process of handling claims, processing payment, and generating revenue for your practice. It includes all functions associated with different steps of medical billing, beginning from the time when a patient makes an appointment and ending after all the claims and payments have been collected and the balance on the patient’s account becomes zero.
Strong RCM will ensure the smooth functioning of your practice, resulting in an accurate collection of reimbursements. Your practice needs to have its policies and practices in place for remaining financially fit and RCM plays a vital role in how organizations can operate on a day-to-day basis. In this article, we will discuss factors that will help in improving the bottom line of your RCM.
Key Components that Improving the Bottom Line of your RCM
Key components of RCM will include patient registration, eligibility, and benefits verification, charge entry, denial management, payment posting, AR management, and provider credentialing. Streamlining all these RCM components will ensure that you will be submitting accurate claims on time and will also receive accurate insurance and patient reimbursements.
Patient Registration
When a new patient books an appointment, billing staff will enter new patient details in the system. These details will include patient and insurance information. This is the first and most important step of RCM. When you submit a claim, patient details are cross-checked with details in the payers’ database, if mismatched, your claim will be rejected.
So, collecting accurate, updated patient & insurance information and entering it into the system without any error will ensure minimum claim rejections. To avoid any mistakes, you can cross-check patient information from the provider portal and if required can update patient information in your system.
Benefits Verification
Eligibility and benefits verification will ensure that all planned services are covered by an insurance carrier. In case of non-coverage of services, you can notify the patient and collect patient responsibility at the time of service only.
Prior to a patient visit, eligibility and benefits verification is conducted where your team member will call the insurance carrier and will check if planned services are covered under the patient’s current healthcare plan. You can also use provider portal or billing software or clearinghouse tools to take out benefits reports. The benefits report will also reveal any requirement of prior authorization.
Charge Entry
Charge entry represents entering charges for all delivered services in form of a claim. This is one of the important processes on RCM as it involves entering key details like patient information, insurance information, rendering provider information, billing information, diagnosis codes, and procedure codes.
Any mistake in this process will either reject the claim or deny the payment, in either case, delaying the payments. If you are using billing software then you just need to update procedure codes, modifiers, diagnosis codes, date of service, and a number of units as other details are pulled by the system automatically. Expert billers and coders are required for this process as it involves entering correct procedure codes, diagnosis codes, and modifiers.
Denial Management
When your claim is submitted, the payer will either accept, reject or deny the payment. When a claim is accepted, you need to check the amount of reimbursement. When it’s rejected, you need to check patient and insurance information, it might be inaccurate or not been updated. When a claim is denied, it means the payer is refusing to pay for the services.
There are multiple reasons for denying the payment and the payer will notify the exact denial reason in remittance advice. You need to review all the denied claims and need to resubmit them with corrected or additional information. You will require an expert biller and coder team to work on denial management for every single claim.
Payment Posting
Payment posting refers to updating received insurance payments against submitted claims in your billing software. It will help you to understand whether the payer has paid fully, partly, or denied the complete payment. When you receive payments, the insurance carrier will share remittance advice stating payment details, every claim wise. Your team member should be qualified to read every line item of the remittance advice.
AR Management
Account Receivables Management refers to collecting the unpaid amounts from insurance carriers. AR management includes processes like identifying denied claims, re-filing the corrected claims, managing denials, patient follow-up, periodical audits, minimizing AR days, and eliminating aged AR. Practices have AR experts who call insurance reps and discuss the reason for denied payment and find out its resolution.
Working on all key components is important for Improving the bottom line of your RCM. To conduct all RCM activities, you will require a team of experts in billing, coding, and AR management. Otherwise, you take assistance from medical billing company, to strengthen your RCM.
Medical Billers and Coders (MBC) is a leading medical billing company providing complete revenue cycle management services. In case of any assistance in RCM of your practice, contact us at, info@medicalbillersandcoders.com/ 888-357-3226
FAQs
1. What is Revenue Cycle Management (RCM)?
RCM is the process of handling claims, processing payments, and managing revenue for healthcare practices to ensure smooth financial operations.
2. Why is patient registration important in RCM?
Accurate patient registration prevents claim rejections by ensuring that patient and insurance information match payer records.
3. What is the role of benefits verification in RCM?
Benefits verification confirms coverage for planned services, allowing patients to be informed of any out-of-pocket costs in advance.
4. How does denial management work in RCM?
Denial management involves reviewing denied claims, identifying issues, and resubmitting corrected information to secure payment.
5. What is AR management in RCM?
AR management refers to the collection of unpaid amounts from insurers, including addressing denials and re-filing claims if needed.
