Physicians and other healthcare providers will always face professional challenges, but in the past few years those have extended to the revenue cycle, with billing becoming a complex endeavor as the industry shifts from fee-for-service to value-based payment models. Increasingly, a focus on revenue cycle processes is crucial to maximizing collections.
Driven by policy initiatives from Capitol Hill and the Centers for Medicare and Medicaid Services, the changes have been rapid-fire. According to Tom Romeo, general manager of healthcare IT solutions at Quest Diagnostics, physicians in the ambulatory space have been struggling to keep up with rules and regulations to ensure they're getting maximum reimbursements from payers while collecting from patients has become more difficult as well.
"If you take a look at what we're seeing in the industry today, where more and more financial responsibility is being placed on the patient, collecting is a challenge for physicians," Romeo said. "They're used to collecting from payers and insurance companies. And the whole denials management process is a bit of a challenge."
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The key to addressing this challenge, he said, is to work with staff on the front end to make sure all of the information being captured is accurate. Sloppy front-end processes create a snowball effect, whereby information is lost and inaccurate billing leads to revenue gaps. Ensuring appropriate front-end processes makes it easier to bill appropriately on the back end, a problem Romeo has seen time and again.
Shifting to a value-based world, with the resulting rise in accountable care organizations, is a hard pivot to make on the revenue cycle side.
"The population we deal with, they've been billing fee-for-service for a really long time," Romeo said. "As they move to this value-based payment framework and become ACOs, they're not as comfortable with the billing processes as they've been in the past."
Physician offices can try to tighten their processes in-house, or they can solicit help from vendors. Quest, HealthCo Systems and Kareo all offer revenue cycle management services aimed at achieving some degree of automation to simplify the endeavor. Which route to take depends largely on the size of the practice, with larger practices typically faring better when it comes to going it alone.
If a practice does decide to partner, it can expect a secure EHR platform to help drive efficiency and improve financial outcomes. Managing things like scheduling and pre-authorization can greatly smooth out the workflow. That's one of the best practices Romeo has pinpointed.
Another tactic is to hire people with some solid expertise in the billing process, since not all insurers are paying correctly.
As the culture shifts and providers try to tighten up their finances, revenue cycle solutions are benefitting from the surge in interest. According to Research and Markets, the market for these solutions is expected to be worth more than $90 billion worldwide by 2022, up from about $51 billion in 2017.
Factors driving the growth of the RCM market include decreasing reimbursements in the healthcare industry, regulatory mandates for the adoption of electronic health and medical records, government initiatives to boost the adoption of RCM solutions, loss of revenue due to billing errors, and process improvements in healthcare organizations.
"This is a hot area in healthcare today," Romeo said. "With all of these challenges, it has to be challenging for healthcare administrators to be keeping up with all of this."