Is Your Revenue Cycle Circling the Drain? Review These Steps to Foster Success

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Healthcare organization revenue cycles can be complex and difficult to manage because each phase of the cycle runs slightly differently while still being inextricably linked to each other. Yet revenue is integral to a practice’s continued health. How can you manage the intricacies of a medical revenue cycle efficiently and effectively? Let’s review the parts of the cycle to find out.

Understand the Parts of the Cycle

Basically a medical practice’s revenue cycle consists of seven steps, says Jayson Meyer, CEO of Synergy Billing in Daytona Beach, Florida:

  • Patient registration at the check-in desk
  • Provider encounter
  • Claim review and charge capture
  • Claims processing and clearinghouse for electronic data exchange
  • Payments and denials from the insurance company
  • Accounts receivable (A/R) followup
  • Patient customer service

Check In, the Doctor Will See You Now

A vital but often overlooked part of the cycle is patient registration and check-in — the key to a clean claim that gets paid on the first submission is clean patient registration data. For example, does the patient’s name match on the Medicare ID and the picture ID? Then comes the whole reason for a medical practice’s existence — the provider encounter. Here, the provider comes in, sees the patient, determines a diagnosis and a treatment plan, and creates a chart note to document the work she did. Getting that chart note completed and signed by the provider can be a challenge, but best practice dictates that you don’t bill until the provider signs off on the chart and closes it out.

Now Code That Encounter

Coding takes place next. We all know how important coding is to the revenue cycle, and how complicated coding can be. Make sure that your practice is up to date on the latest ICD-10 updates, alterations, clarifications, and rulings, and keep an eye on new wording and extra digits. Then, make sure your chart notes and your codes match. If outside auditors come to call, your provider’s chart notes better justify what you have billed. CMS says insufficient documentation is the number 1 reason that Part B claims are deemed improper. And watch your use of modifiers, because if they are added haphazardly to codes, a claims avalanche can follow that would lead to a mudslide of payment reversals.

Are the members of your coding and billing staff certified? Medical coders must have excellent working knowledge of anatomy, physiology, disease processes, and clinical procedures to be able to apply the codes that make up the business side of medicine. Certification helps ensure that coders and billers have that knowledge.

Scrub That Claim and Clear it Out!

Once coding is done, the claim can be reviewed and scrubbed, and the charge captured. Scrubbing checks claims for simple data entry errors as well as review of codes and modifiers to ensure compliance with payer rules. Next the claim heads to the clearinghouse, which uses electronic data interchange (EDI) to submit the claim data into the format required by a particular payer.

Manage Denials to Create Payment Opportunities

Next up is denials management, which creates an opportunity for regular internal audits. Payers can vary widely in their guidelines and rules affecting payment. For example, timely filing limits can vary among payers. Medicare and Medicaid allow up to 12 months for a claim to be filed and completed, but managed care organizations typically allow 90 days to send in a clean claim and get it paid, and then another 60 days to appeal any denials. Auditing helps you find the mistakes and create new payment opportunities.

Manage Accounts Receivables and Follow Up With Patient Customer Service

Accounts receivable (A/R) followup is an important benchmark to follow, but be careful how you use that data. One of the quickest ways to get A/R times down is to write off bills, which could lead to a great-looking A/R number but a significantly crippled revenue stream. Use A/R followup as a safety net allowing you to look at a long list of accounts to see why a charge is still on the books. Finally, don’t skip good customer service for patients. In patient billing, make sure that patients have a way to review a bill and pay online through a portal or by phone. Patients should also have a way to get answers right away when they have questions.

How About You?

Got any tips to share on revenue cycle management? We’d love to hear them! Let us know in the comment box below.

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Susan taught health information and healthcare documentation at the community college level for more than 20 years. She has a special love for medical language and terminology. She is passionate about ensuring accurate patient healthcare documentation through education. She has a master's degree in healthcare administration, is a certified healthcare documentation specialist, and serves as immediate past president for the Association for Healthcare Documentation Integrity (AHDI).

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