Many medical practices waste hours and dollars managing routine administrative tasks related to billing and insurance, reducing their overall productivity. They lose valuable time searching through paper-based records and handling patients’ insurance claims manually.
Making a tech investment to handle these functions might just sound like an additional expense. But the fact is, you can’t spend the time helping your patients when you’re struggling with receiving payments on time from either patients or insurance providers.
Finding the right revenue cycle management (RCM) tool is essential to ensuring that you’re meeting your bottom line without sacrificing quality of care.
In this article, we’ll focus on the challenges practices face in revenue generation, why it’s important to manage your revenue cycle efficiently, and how RCM technologies can help you speed up your revenue generation process.
The 2 reasons most practices lose revenue
There are two common challenges in generating continuous revenue that nearly all medical practices face:
1. Claims denials by insurance companies
Probably the biggest challenge in the revenue cycle is dealing with insurance companies. If you don’t watch the claims process closely, you won’t be able to identify errors that result in claims denials by insurance companies. One common checkpoint, in particular, that is easy to miss when administering healthcare procedures is running the proper eligibility checks.
2. Billing and collections errors
Incorrect billing causes medical practices to lose out on thousands of dollars. It can also burden patients with heavy debts. Billing and collection errors are often caused by mistakes during manual input, and identifying and fixing these mistakes in time is crucial.
Why you should invest in RCM software
RCM software helps medical practices track, manage, and collect payments in a timely manner from patients and insurance providers.
IT advisory firm Gartner recommends the medical practices use RCM technologies in the following ways to optimize their tech investments:
- Aim for an electronic claims submission rate of at least 95% to improve workflow efficiency and lower administrative costs.
- Map the complete list of denial codes in your RCM system, including claim adjustment reason codes (CARCs) and remittance advice remark codes (RARCs). This action will improve accounts receivable days and cash flow, as well as set you up to analyze and predict denials based on the root cause.
- Leverage the RCM system to automate the transmission of notice of admissions (NOAs) in order to reduce payer denials, lower payment penalties, and improve timely processing of claims. (Full research available to Gartner clients.)
In addition, RCM software can help you realize the following capabilities and benefits:
- Automated insurance verification.
- Central storage of patient billing information and payment records and integration with existing electronic health records (EHR) systems to better track billable services.
- Automated balance payment reminders for patients and payers and accounts receivable functionality to track current balances.
- Payments processing and point-of-sale transactions.
- Data analytics for insights such as what percentage of claims are denied and why.
How RCM technology can maximize your revenue
RCM systems help track claims, collect payments, and manage claims denials. These technologies help generate a steady source of revenue by helping you verify patients’ insurance coverage and code claims correctly and in a timely manner.
Here’s how RCM software can help you maximize revenue:
For any questions related to different RCM software options for your practice, click here to schedule a free consultation with a medical software advisor. You can also check out the revenue cycle management (RCM) software options in our directory.
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