Introduction
Revenue cycle management (RCM) is a financial process used by healthcare institutions to facilitate tracking patient care events from when they register to the time they make payment for the rendered services. RCM utilizes medical billing software and integrates the clinical and business sides of healthcare. The process combines administrative data, including patients’ personal information and insurance providers, with the healthcare data and treatment they receive. While RCM has significant importance in an acute care environment and positively impacts healthcare organizations, it can hurt the latter’s operations if improperly implemented.
Main body
RCM plays a significant role in reducing the time between offering services and receiving payments. RCM is integrated with other information technology systems in healthcare facilities, such as electronic health records (EHR) and billing schemes (DelVecchio & Lee, 2017). As a result, healthcare providers in the acute care settings quickly access patients’ information from the EHR and enter the prescriptions and charges, which are reflected immediately on the billing systems. Patients would be required to the billing department, which is time-consuming because of possible queuing. The facilities electronically send the information regarding treatment provided to patients to relevant insurance companies for payment.
RCM helps identify the cause of delay and underpayments, reduces facilities’ operational costs, and helps them evaluate value-based payment accuracy. According to Healthcare Financial Management Association (2018), RCM cuts operational costs by approximately 15 % because few healthcare providers are needed to execute the same amount of work. Delays and underpayment may be inevitable when errors occur during coding treatments and sending the information to insurance companies. RCM systems ensure the coding of all diagnoses and provide organizations with opportunities for correcting mistakes, alleviating the possibility of underpayments and reimbursement delays. Inaccuracies are bound to happen when hospitals have separate workflows and dissimilar billing systems for a single episode of care. However, RCM systems ensure that all departments access the same workflow, making it easier to reconcile incurred costs with payments.
RCM system performs various administrative tasks in acute care settings. RCM reminds payers (insurance companies) and patients of existing balances, informs clients about upcoming appointments with doctors, and questions the insurers when claims are denied (Healthcare Financial Management Association, 2018). These tasks ensure that healthcare facilities have a consistent flow of revenues. RCM allows healthcare providers the enter information, such as patients’ names and type of treatment received, needed for claim processing without resubmission or revision of the latter. Thus, RCM significantly decreases the amount of denied claims reported by a healthcare facility. Other benefits of RCM in acute care settings include improved quality of treatments and efficient services (DelVecchio & Lee, 2017). RCM permits doctors and nurses to access patients’ data about previous treatments, assess their effectiveness, and prescribe different medications or refer them to specialists.
Improper RCM in healthcare facilities has negative impacts on organizational productivity. Ineffective RCM lessens the amount of revenue a healthcare institution generates due to possible unprocessed payments and denied claims (Healthcare Financial Management Association, 2018). As a result, the organization lacks enough money to purchase needed care services for patients. The hospital may also have trouble paying salaries, reducing employees’ job satisfaction and engagement, which significantly lowers productivity. The issues can also increase the chances for doctors and nurses to move to another institution with well-planned RCM. Moreover, patients avoid such facilities that do not offer the quality of services they need.
Conclusion
Conclusively, RCM is an instrumental tool that facilitates tracking patient care events from the time they register they make payment for the rendered services. It has a significant role in reducing the time between offering services and receiving payments. It also helps identify the cause of delay and underpayments and reduces facilities’ operational costs, aids them in evaluating value-based payment accuracy, and performs various administrative tasks. Improper RCM hurts organizational productivity due to inadequate resources and reduced employee satisfaction and engagement.
References
DelVecchio, A., & Lee, K. (2017). What is revenue cycle management (RCM)? SearchHealthIT. Web.
Healthcare Financial Management Association. (2018). Enterprisewide revenue cycle management reduces costs, improves patient loyalty. HFMA. Web.