Revenue management is a critical part of every medical practice. Declining reimbursement, shifts to value based care and stringent quality standards and denial of claims are some challenges in private practice.
With the given challenges, it is all the more important for private medical practices to focus on patient collections and intelligent revenue cycle management.
Effective communication is the foundation of every successful business. Ineffective or poor communication in healthcare organizations costs $12 million every year according to an estimate.
Challenges In Managing Revenue In Private Practice
Challenges to managing revenue cycle in private practice can include:
Untrained staff: With busy practices, there could be lack of time to train the staff involved in handling revenue cycle. Poorly trained staff can make costly errors in billing and coding or enter incorrect data with respect to insurance or demographics. Minor errors result in claim denials and rejections leading to delays in payments.
Lack of communication: Front and back office staff have to coordinate when it comes to revenue cycle management. With incorrect information or lack of proper communication about patient details from front office, the back office can make serious errors while coding or billing.
Lack of defined work-flow: With busy practices, there could be chaos in terms of work-flows. Before the patient comes in the staff needs to be trained to check eligibility and co-pay so as to bill correctly. Claim denials may not be followed up in a scheduled manner or may be missed altogether. All of these can have a serious impact on the revenue cycle.
Why Outsource Revenue Cycle Management?
CMS, according to one estimate, rejects close to 26% of claims and almost half of these rejected claims are not resubmitted at all. Such negligence can result in 10% loss in revenue for one physician.
Outsourcing revenue cycle management (RCM) to experienced agencies can help streamline work-flow and revenue cycles. Revenue Cycle Management in private healthcare involves managing processing of claims, collections of payments from patients, revenue generation and reporting. A smart revenue cycle management company can handle all the billing and accounting details which lets the practice focus on quality care. The healthcare revenue cycle management process starts from evaluating the patient eligibility, collection of co-pays, accurate medical coding, and following up on claim denials.
Private practice can focus on meeting the MACRA requirements and leave the revenue management to specialists by outsourcing to RCM agencies.