In the healthcare system, providing great care to patients is not the only component to the equation. Providers also have to take care of the financial aspect of their services in order to keep practices running smoothly. Therefore, Revenue Cycle Management (RCM) plays an important role in medical billing. An effective RCM process means that providers receive the proper and timely payment for the care they provide.
In this guide, we are going to go through 13 steps of revenue cycle management, discuss how it is implemented in medical billing. It also includes how providers, small clinics, and large hospitals can enjoy working with experienced revenue cycle management companies.
What Is Revenue Cycle Management in Medical Billing?
Revenue Cycle Management in medical billing refers to the process by which claims are managed, payments collected, and revenues created by medical facilities or other healthcare providers. It involves all the processes of a patient, starting with the initial visit up to the last payment. An effective RCM process in medical billing means fewer billing errors, quicker reimbursement, and a more fitting bottom line.
The best way to learn is to master steps in the RCM process, whether you are managing a hospital, a physician revenue cycle, or a small clinic revenue cycle management system.
Why Does RCM Matter?
- Reduces denied claims
- Accelerates cash flow
- Improves patient satisfaction
- Ensures regulatory compliance
- Helps make data-driven decisions
Many providers now rely on revenue cycle management companies to streamline their operations and free up more time for patient care.
The 13 Steps of Revenue Cycle Management
1: Patient Scheduling
Naturally, RCM starts at the point when a patient makes an appointment. Proper scheduling takes care that the time is well spent and resources are not wasted.
2: Patient Registration
This is a step where relevant information about the patient is gathered, such as address information, demographics, and insurance details. Mistakes in this step may cause rejection of the claims in the future.
3: Insurance Check and Eligibility Check
We still wonder, “What is verifying insurance part of which revenue cycle step?” Here it takes place. The provider should also confirm that the insurance is active and can settle the planned procedures before delivery of services to the patient.
4: Authorization and Referral Management
Pre-authorization or referral is needed by insurance payers for some services. Pre-authorization before the procedure will make it covered and ensure faster reimbursements.
5: Charge Capture
This is the part where feedback on the services rendered to the patient is recorded and translated into charges. Proper capture of charges will guarantee that the providers will receive the right amount for the work they performed.
6: Services Medical Coding
Medical procedures and diagnoses are translated by the professional coders into universal codes like ICD-10, CPT, and HCPCS. It plays an important role in the RCM process in medical billing, and it results in what the provider receives as a payment.
7: Charge Entry
All the services that have been written in code are entered into the billing software. The charge entry team makes sure the entry is assigned to the correct patient, provider, and payer.
8: Creating And Filing Claims
Claims are written and forwarded to insurance companies. Mistakes made at this stage usually lead to denials, hence the importance of accuracy. This action is part and parcel of revenue cycle management in medical billing.
9: Payment Posting
Once the payer has run the claim, the patient is charged on the account. Any co-pays or adjustments, or deductibles are also noted.
10: Denial Management
Some claims are rejected because of inaccurate or incomplete details. This will be done by establishing the cause of denial, rectifying the mistake, and resubmitting the claim.
11: Patient Billing and Statement Generation
After insurance has been charged accordingly, the balance is charged to the patient. Effective and clear statements can prevent misunderstanding and encourage timely payment.
12: Collections Process
In case a patient fails to clear the bill, the process of collection starts. This can be followed by mailing of reminders, calling on the phone, or even calling a third-party collection agency.
13: Reporting and Performance Analysis
Analysis is the last step in the revenue cycle. It also produces reports that are used to gauge the efficiency of the billing process. Measurements, such as the claim denial rates, Days in A/R (Accounts Receivable), and the net collections, are analyzed to enhance future outcomes.
Common RCM Models: 6, 10, or 13 Steps?
The question in mind may be, what are the six stages of the revenue cycle? Or, perhaps you have read lists of 10 steps in the revenue cycle. These are just matters of description of the same process.
There are 6 Stages of the Revenue Cycle:
- Pre-registration
- Registration
- Charge Capture
- Coding & Billing
- Claims Management
- Reporting
10 Steps in the Revenue Cycle
These typically exclude referral management, charge entry, or reporting stages.
13 Steps of Revenue Cycle Management
This is the most detailed and comprehensive approach, especially relevant for modern healthcare revenue cycle management processes.
Who Needs RCM? (Hint: Everyone)
Whether you are an independent doctor or even a large healthcare organization, making sure you manage your physician revenue cycle is the key to maintaining your financial health. In the case of small setups, it could be ideal to use a small clinic revenue cycle management to outsource.
Aligning with revenue cycle management companies will assist you:
- Ease the staff load
- Increase collections
- Be paid quicker
- Be in compliance
- Patient-orientation
Choosing the Right RCM Support
When seeking psychiatric medication management in the best way possible, the right billing system is highly essential. An efficient revenue cycle management (RCM) process can ensure that clinics and physicians get paid promptly and patients find it easier to access care without being burdened by billing complications.
These companies minimize errors and accelerate the payment response. RCM support can enhance patient care and the bottom line, regardless of whether you have a small clinic or a large hospital. When you manage the billing process easily, you are able to spend more time with your patients without worrying about the paperwork.
Final Thoughts
The 13 steps of revenue cycle management play an important role in the initial success of a healthcare practice. It includes scheduling of patients and results reporting, and contributes to a reduction of errors, cash flow, and timely payments. Anything less, or any delay, can result in claim denial, lost income, or unsatisfied patients.
At Prospect Healthcare Solutions, we handle all phases of the RCM process with precision and diligence. Our highly trained staff of experts strives to keep your billing simple, reduce delays and collections, all so you can concentrate on patients instead. So, Prospect Healthcare Solutions will make your revenue cycle simple and easy, and work to develop your practice.
FAQs about RCM in Medical Billing
Q:How many steps comprise the revenue cycle management?
Scheduling, Registration, Insurance Verification, Authorization, Charge Capture, Coding, Charge Entry, Claim Submission, Payment Posting, Denial Management, Patient Billing, Collections, and Reporting.
Q:Which is the revenue cycle step involving verifying insurance?
It takes place at the third stage, step 3: insurance verification and eligibility check, which is among the most crucial ones to eliminate the denials of the claims.
Q:What’s the final step in the revenue cycle?
The last step is called reporting and performance analysis (step 13). It assists in establishing shortcomings and the place or areas that needs improvement.
Q:What is the role of revenue cycle management companies?
They provide full-scale billing, coding, claim submitting, denial follow-up, and reporting. This results in an increase in profit and a reduction in the delays.
Q:How do 6, 10, and 13 revenue cycle steps differ?
It is a matter of detail. The 13 steps of revenue cycle management provide an inclusive breakdown of the control to have greater control more simply, whereas the 6 or 10 step models are simpler adaptations.
