It is not uncommon for some to think of revenue cycle management as just outsourcing the billing. In truth, it is much more. Revenue cycle management (RCM) is the complete financial process between your behavioral health program and the patient from appointment to remittance of the final payment. The Healthcare Financial Management Association describes the revenue cycle as “…all the administrative and clinical functions that contribute to the capture, management and collection of patient service revenue.”
Revenue Cycle Management is a holistic approach
There are generally nine recognized functions in a complete revenue cycle. These functions ensure not only a roadmap for the cycle, but they systematize it in a way that helps to prevent steps from getting missed. Rather than just throwing a bunch of steps together the systemization provides a maximum benefit for your behavioral health facility.
The Functions of a Revenue Cycle
1) Pre-registration: When we think of pre-registration, we often think of the time savings on the day of the appointment. While there is value in that, especially to the patient, it also helps them see what their projected out-of-pocket expenses will be so there will be fewer unexpected charges. From your program’s point of view, it helps prepare the patient and lets them plan to pay on time.
2) Registration: This function collects the rest of the needed information and gives your facility the opportunity to review the pre-registration information for errors. Catching errors early can eliminate errors in reimbursements to your facility.
3) Charge capture: This is a crucial part of the cycle. In this step, charges for your services are captured and submitted to the insurance companies.
4) Utilization review: During this function, the insurance company reviews the treatment plan for cost and appropriateness. This is a great opportunity to ensure that both parties are on the same page and minimize the chances of slow payments or disputes.
5) Coding: Taking the diagnoses, procedures and services and putting them into a common language is not new to the medical field, but it is still an integral part of the revenue cycle. Correctly used, these codes help ensure reimbursement submissions are not unnecessarily delayed.
6) Claim submission: After everything is properly coded into the system, the claims can be submitted to the carrier. Ensuring that claims are submitted correctly and in the proper time frame helps your program avoid delays in being reimbursed for the services you provided.
7) Remittance processing: During this function, payments are either received and applied to the account or rejected. Rejections are often a result of patient registration errors. If errors are discovered, the claim can be corrected and resubmitted.
8) Third-party follow-up: During this function denials, underpayments or slow payments are often addressed. This is also the stage where issues like rates and timelines can be noted so they can be part of the next negotiations with the payer.
9) Patient collections: This is becoming a more critical part of the revenue cycle. With high-deductible health plans increasing, the amount of responsibility for payment from the patient is also increasing. By properly managing the expected costs, starting back at pre-registration, patients will find fewer surprises and your behavioral health facility will see fewer slow payments. The trend towards patient responsibility is an important one to be managed. One study by TransUnion Healthcare showed that patient financial responsibility after insurance increased 88 percent between 2012 and 2017.
As we discussed in a previous article, there are significant benefits to outsourcing your behavioral health program’s billing. If you would like more information on how Nextus Billing Solutions can help your behavioral health program improve your revenue cycle management, schedule a consultation with us. We can’t wait to help your facility.