Common Challenges in RCM Revenue Cycle Management

 

The foundation of healthcare is the Revenue Cycle Management (RCM), which guarantees doctors and clinics can get a prompt and precise payment after delivering the services. Nevertheless, it is hardly a straightforward process. Be it in working with patient information or insurance claims, the healthcare organizations frequently face numerous challenges that break the flow of cash and affect the financial stability.

The initial knowledge of the RCM challenges is the beginning of their solution. Today, we are going to consider the seven most common issues of revenue cycle management experienced by healthcare providers and provide some strategies that could be used to address them.

Top RCM Issues Impacting Healthcare Providers

1. High Claim Denial Rates

Claim denials are one of the most urgent problems in the field of medical billing. The research indicates that close to 10-15 percent of claims are either rejected or denied at first as a result of flawed patient records, errors in coding or no records. Rejecting payments does not only make payments slow, but also contributes to the administrative burden.

Denials accumulate, cash flow is harmed and providers are left with a hard time covering their daily operations.

2. Delayed Insurance Payments

Insurance payments are usually delayed in weeks or months after the claims have been approved. These delays may negatively affect predictability of revenues and put the organization in a situation of being unable to pay employees, sustain resources and invest in improved patient care.

In heavily insured practices, there are severe financial choke points due to late payments.

3. Coding Problems and Noncompliance

Claims cannot be submitted successfully without accurate coding. Regrettably, coding errors have been the number one cause of denials and non-compliance. Healthcare organizations also need to adjust to regular changes in ICD-10 and CPT codes that may be difficult and time-consuming.

Inappropriate coding does not only decrease reimbursement, but can also result in compliance audit causing possible penalties.

4. Absence of Transparency of Patient Payments

Due to the emergence of the high-deductible health plans (HDHPs), patients are expected to take up more of their healthcare expenses. Most patients do not know how much they owe, though, until they are billed. This nontransparency usually leads to late payments, unpaid payments and patient dissatisfaction.

The communication of financial responsibilities is very important to prevent confusion and late collections.

5. Poor Billing Processes

Inefficiency in the revenue cycle is caused by manual billing processes, disjointed systems and lack of automation. An example would be when the staff are wasting hours entering claims manually or denial tracking, the time spent becomes less productive and the error occurs more often.

Inefficient workflow slackens the whole revenue cycle process in medical billing and wastes resources.

6. Increased Administrative Expenditure

Revenue cycle management is labor-intensive and expensive in terms of technology. With the development of the regulations, there is more demand towards the compliance experts, certified coders, and sophisticated billing systems. This increases the administrative expenses and many practices have difficulty in balancing the administrative expenses with the reimbursements.

These increased costs can be a burden especially to small and mid-sized practices.

7. Compliance & Regulatory News

The healthcare sector is very regulated, and the rules on billing, insurance and compliance requirements by federal regulations kept changing. It is difficult to keep abreast of such updates and non-compliance may lead to fines, non-rewarding claims, and even prosecution.

It is a matter of constant training, upgrades to systems and close monitoring to remain on track.

The Way to Defeat These Obstacles

The problems of RCM are great; however, they can be overcome. With the appropriate strategies, health institutions will be able to simplify the billing processes and stabilize finances. 

These are some of the solutions that have been proven:

• Automated Billing Tools
  The tools supported by technology are able to minimize manual errors, identify the gaps in documentation and accelerate filing of claims. Real time tracking of denials is also achieved through automation with increased recovery rates.
• Staff Training
  Frequent training keeps billing personnel informed about the changes in coding, payer policies and compliance. Experienced personnel will be able to detect mistakes early and reduce the number of claims rejected.
• Outsourcing RCM Services
  Collaborating with a reliable service provider such as ElintRCM enables the healthcare practices to leave the burden of billing to the provider. ElintRCM focuses on the full service management of the revenue cycle, including registering the patient and collecting the payments, and ensures accuracy, compliance, and quicker payments.
  By outsourcing, not only are errors minimized but providers are instead in a position to concentrate on providing quality care to patients.
• Regular Audits
  Regular audits can help to uncover inefficiencies, reveal lost revenue, and keep up with evolving regulations. Audits are also able to enable organizations to take corrective measures before things get out of hand.

Conclusion

The revenue cycle management is a critical part of the financial performance of healthcare organizations. Denials, slow payments, compliance issues are typical problems; however, with automation, training, outsourcing, and proactive auditing, these problems can be easily mitigated. ElintRCM offers end to end solutions to assist healthcare providers to overcome these challenges and maximize cash flow as well as increase patient satisfaction.

Contact ElintRCM to simplify your medical billing and revenue cycle.

FAQs

Q1: Why is RCM problematic to small practices?
Small practices frequently do not have the resources and staff to deal with complex billing processes, and therefore are more susceptible to denials, compliance risks, and disruption of cash flows.

Q2: What can hospitals do to decrease denials?
The prevention of denials by hospitals can be achieved through facilitating the proper documentation of patient information, the application of sophisticated claim scrubbing software, regular training of staff and denial trend analysis.

Q3: What is the role of technology in RCM?
Technology assists in automating claim filing, tracking the denials, determining eligibility and ensuring compliance. It decreases human mistakes and increases the speed of the whole revenue cycle.