What is Healthcare Revenue Cycle Management?
Posted on February 22, 2023 by Kylene Ordway
It doesn’t matter what type of healthcare organization you’re talking about – be it a small, private practice or a large, national hospital system – each and every one of them provides potentially life-saving care to patients on a daily basis. But at the same time, one must acknowledge that none of this would be possible if those organizations don’t use all means available to them to stay “healthy” themselves from a financial perspective.
This is where the concept of healthcare revenue cycle management enters the conversation. It’s defined as the collection of all administrative and clinical tasks that help to capture, manage, and collect patient service revenue. In other words, it helps to make sure that patients are actually paying for the services that they receive in a way that keeps money coming into the organization, enabling it to continue with its own important mission for the foreseeable future.
But for as straightforward as this concept may seem, it’s still a complicated process filled with many “moving parts.” To fully understand what healthcare revenue cycle management is and why it is so essential, there are a number of important things to keep in mind.
The Ins and Outs of Healthcare Revenue Cycle Management: Breaking Things Down
First, it’s important to understand that when a patient receives service, they are billed for that which they received as per the terms of their insurance coverage. One plan can vary wildly from the next when it comes to things like which services are covered and which aren’t, what types of deductibles someone must pay, copay, co-insurance considerations, and more.
Because of that, each service must be billed with the correct billing code attached to it – one that accurately describes exactly which service was performed, when it was performed, where it was performed, and most importantly why.
This contextual information is at the core of healthcare revenue cycle management. The process itself typically goes as follows:
- Typically, a healthcare organization will contact a patient’s insurance provider to get pre-authorized for any procedure, medication, or service that is to be utilized. This may also be necessary when using certain types of equipment, too. Provided that the pre-authorization is granted, the service in question will be performed.
- At that point, a claim will be filed for the service. A worker who has been highly trained will read the description of the service and associate it with the appropriate medical coding. This includes not only codes related to the service, but also diagnosis codes that help the insurer properly track the health status of the insured. Once finalized, the claim will be submitted.
At that point, one of a few things will happen. If the claim is fully paid by the insurance company, it must be associated with the patient’s account to reflect that. If the claim is denied, details about why will be provided. Healthcare providers can submit an appeal to the denial on the patient’s behalf, or the patient can do it themselves. If the claim continues to be denied, it means the entirety of the bill must be paid by the patient.
This segues into the accounts receivable management process, or the point when healthcare organizations collect on those outstanding balances.
Obviously, this is where things tend to get complicated. Administrative officials need to keep track of the amount of money owed, how much the patient owes, how much the insurance company is paying, which portions of the balance have been collected yet, whether bad debt can be off-loaded to collection agencies, etc. It can take up a tremendous amount of time and is a process prone to human error, which is why many organizations choose to outsource parts of their healthcare revenue cycle management needs to a third party like the team at KeyBridge.
The KeyBridge Approach
At KeyBridge, we firmly believe that patient care doesn’t end when someone leaves their healthcare provider. In many ways, the story is just beginning. Rather than providing the same old customer service process to people, we aim to go deeper – to create a legitimate experience in every sense of the term. One that is engineered to be different. One that is built on relationships. One that puts the power of a patient’s journey back in their hands where it belongs. Healthcare revenue cycle management is just part of how we do it, and we want to continue to revolutionize the way patients think about healthcare for years to come.
If you’d like to find out more information about the inner workings of healthcare revenue cycle management, or if you just have any additional questions you’d like to go over with someone in more detail, please don’t delay – contact KeyBridge today.
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