You’re a partner in a private Family Medicine practice with two other Medical Doctors, two Nurse Practitioners, five Medical Assistants, and six office staff members. You have a robust patient panel and offer multiple volume-based medical procedures in-house. However, at the end of every fiscal year, your practice is 8% below your projected revenue target based on all the hard work your practice completed the previous year. What’s going wrong? How can you fix it?
Revenue Cycle Management (RCM)
You probably already know what Revenue Cycle Management (RCM) is, even if you don’t use the exact term. RCM is “the financial process . . . that healthcare facilities use to track patient care episodes from registration and appointment scheduling to the final payment of a balance,” usually by using some sort of medical billing software or an outsourced medical billing firm. The cycle can be broken down in a few ways, but RCM almost always includes: Electronic and Paper Claim Submission, Secondary and Tertiary Claim Processing, Payment Posting, A/R Management and Follow-Up, Appeals and Claim Resubmission, Patient Billing and Follow-Up, Patient Statements, Benefits and Eligibility Verification and Monthly Reports and Analysis.
For family practice providers, there are a number of specific RCM concerns that continually present obstacles to medical billing properly and profitably. Here are three of the most common revenue cycle concerns for Family Medicine:
This one seems obvious. When a patient doesn’t show for an appointment, it can be nearly impossible to fill the appointment, unless you have a standing walk-in list, or are lucky enough to receive a call requesting that time slot. The revenue lost in a no-show goes beyond not being able to bill for one single appointment. Think about the time spent scheduling the appointment, the overhead and utilities spent on a vacancy, and disposable medical materials possibly wasted when a patient misses an appointment. These costs add up, especially in primary care, where volume of patients is often needed to offset fewer procedures. Any practice needs to take a look at the number of no-shows via monthly, quarterly, and yearly periods to see if holidays, seasons, or school schedules seem to correlate with increased no-shows.
Solutions to no-shows range from simple to complex, with simple being the cheapest. Smaller changes in scheduling practices, like setting stricter cancellation policies, reminder calls the day before the appointment, or contingency plans to swap patient appointments to open slots, can help reduce these wasted opportunities in your medical billing. These changes will often at the very least reduce longer wait times in a clinic, often cited as the number one reason why patients do not keep their appointments.
Accounts Receivable (AR), or the outstanding billing invoices and money owed to a practice from its patients, is the area most analyzed by family practice billers. This is a problem as healthcare facilities spend far too much time looking at billing patterns, dollar volume of charges, and timeliness of charges being submitted compared to reported irregularities. More time is also spent examining rejected claim trends.
This is all incredibly important information to scrutinize, of course, however the physical amount of time spent analyzing AR is time that instead could be spent reducing inefficiencies elsewhere. It is a drain on an already overburdened billing department. Best-practices for AR involve streamlining the amount of time from billing to collection, whether by setting up a flag system for early rejection of claims, or increasing the frequency of reporting.
Manual Claims Management Processes Create Huge Administrative Delays
Submitting a claim or working through a denial is complicated and difficult. Think of all the data that needs to be gathered, the channels of communication that need be set up between front desk staff and medical providers, and the importing of previous claim information. Now, compound that time with the extra time it takes to process all this information manually.
You might be surprised to find that even in practices that have largely digitized their billing departments, much of their claims management is still done manually. Manual claims management is a hugely inefficient use of resources and often restricts RCM flow, thus reducing revenue of the healthcare facility overall.
Outsource Your Medical Billing
We reviewed the three main concerns with Revenue Cycle Management. They all have possible solutions, but the solutions usually require a halt in all the other mechanics of business administration, which most healthcare practices simply can’t afford. In terms of value for dollar spent, it often makes perfect sense to outsource your practice’s medical billing RCM to a company like Delphi Management Services. Delphi can handle the complexities of these issues and increase your company’s revenue while allowing you to focus more on patient care, thus making sure you’re not wasting any time during your already busy day.
So, the next time a patient doesn’t show up, you won’t be worrying how this affects your bottom line. Instead, you’ll already be admitting your next patient while ensuring those you’ve already treated are setup properly and won’t experience denied claims.