Revenue cycle management is the means by which health care organizations track revenue generated by patients using medical billing software. The significance of this system has increased as the methods of payment n hospitals shift from fee-for-service to other prospective methods such as insurance claims (Harrington, 2016). The RCM combines the collection of cash payments after claim processing and deals with claim denials. It follows up on patient’s service revenue generation since the registration of a patient to appointment set up to the final payment phase. It entails the use of technology that ensures proper payment of service providers.
The healthcare reimbursement system is more complex with the accuracy and precision of which the organization gets paid for their service becoming complicated. Accordingly, the relationship between revenue generation and cash flow within the system should be efficient by use of RCM for the smooth running of the health care center. The various departments ranging from finance to care management, registration, and admissions to inpatient and outpatient to service departments, clinical staff involved should coordinate and maintain effective communication and function as a team.
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The management of the revenue cycle requires the cooperation of the payers which allow the service provider access to the patients’ insurance status, their level of benefit, their eligibility and information on potential secondary payers (Harrington, 2016). Before completion of the compensation process, the utilization management guidelines should be cleared out, medical necessity identified and any prior approval requirements acknowledged. Transparency is vital for the success of RCM and allows assessment of patient ability to meet the cash at hand portion of the medical bill.
With technology, submitting claims and collection of payments both pre-paid and point-of-service is handled electronically. In case of problems in the cash flow system such as insurance disapproval or delayed payments, the RCM tracks account receivables in real-time and address the issue.
References
Harrington, M. K. (2016). Health care finance and the mechanics of insurance and reimbursement . Burlington, MA: Jones & Bartlett Learning.
