The physician practice revenue cycle is the one thing which will sustain a practice to provide patient care without undue “cash flow problems.” Even if you have a premier healthcare team providing the highest quality medical care, you can’t keep your organization open without getting paid. Organizations that succeed in healthcare but fail at the physician practice revenue cycle will find themselves struggling to stay operational.
The ultimate financial goal of your practice is to have an efficiently operating revenue cycle that allows you to focus on what you do best, patient care.
But how do you reach that goal? First, let’s look at the basics of the physician practice revenue cycle.
What is the revenue cycle?
To simplify, the revenue cycle encompasses the entire scope of the patient account from the day it’s created until the day the payment is received. Specifically, it’s everything that contributes to capturing patient data, managing the patient account and collecting fees.
An unhealthy billing department is one in which payments are defaulted or paid in an untimely manner. Following best practices while keeping an eye on key metrics ensures that you collect fees for your services and keep processes running smoothly.
Where can it go wrong?
There are many points along the way that can cause trouble for collecting patient payment. Some common problems include:
- Errors in billing.
- Inaccurate data entered during registration.
- Unverified insurance.
- Incorrect codes entered for billing to insurance.
- Denied insurance appeals.
- Neglect in the charge capture process.
8 ways to keep your physician practice revenue cycle healthy
You may not be able to eliminate all mistakes or risks, but when you follow best practices, you can improve the performance of your revenue cycle and reduce the risk of committing one of the identified inaccuracies above. Here are some steps you can take to improve the health of your patient practice revenue cycle.
1. Streamline your check-in and check-out process
Verify patient information ahead of time when the patient calls for an appointment. At this time, you can also confirm insurance coverage and let the patient know of any outstanding bills they have.
2. Be transparent about billing charges
Keep the patient informed about how much of the bill they are responsible for and what their insurance will cover. In other words, be open with them about charges, and don’t let large bills take them by surprise after their treatment.
3. Pay close attention to the charge capture process
In this critical physician practice revenue cycle step, document patient encounters in your medical records/charts, and assure correct coding for claims submission in compliance with applicable standards for medical necessity.
According to a recent survey, 78% of healthcare executives say charge capture is essential. But only 40% of them discuss it at least once per month. Although providers see the importance of charge capture, they tend to neglect talking about it. Don’t do that. Instead, establish standard processes and periodic reviews to ensure consistency.
4. Manage the charge entry specialist
This person is responsible for entering the data from the capture process. This information must be error-free. One typo can mean an insurance claim denial, so be sure to train this employee and offer them the proper resources.
5. Monitor insurance claims
There are many details involved in submitting claims to insurance companies in the right manner. Ensure the staff responsible for dealing with insurance claims is careful in following all of the insurance carrier’s documentation requirements.
Further, they must confirm that the insurance companies have received the claims and are processing them. If claims are denied, your staff may need to resubmit them with different coding or other errors corrected.
6. Be clear and concise in patient billing needs
The patient billing statement should be clear with all pertinent information included. Clearly mark all final bills. Also, inform the patient of all the ways to pay and offer them payment plans if they can’t pay in full. Collect patient payments upfront when possible.
7. Include detailed reports of the entire process
You can’t know where you might be going wrong if you don’t analyze how procedures are working. Detailed reports of your physician practice revenue cycle can help you spot weaknesses before they grow too large to handle. Look for a revenue cycle management software system that will give you customized reports to keep track of your billing department’s performance.
8. Automate as much of the cycle as you can
The more that technology can help automate your processes, the more efficient your clinic will be and the lower the chance of error you will have. Look for ways you can use medical billing software to help increase accuracy and productivity.
How to spot weaknesses in your physician practice revenue cycle
Follow these key metrics for measuring performance, and you will see where any leaks in the process might be coming from:
- What percent of accounts receivable balances are beyond 120 days?
- What’s the average amount of time it takes your clinic to collect patient fees?
- What is the percentage of claims that are denied the first time around?
- What is the amount of money that you must write off? How much money out of what you are eligible to collect are you collecting?
At times you may want to engage an outside consultant for a billing/coding/collection and documentation review, to be able to assure best practices.
Final thoughts on the physician practice revenue cycle
It’s impossible to know how your business is performing if you don’t measure it. By tracking data and using it to generate instructive reports, you can accurately see whether your staff is performing efficiently and your billing process is working the way it should while spotting areas that need improvement. You can focus on patient care and keep your practice viable when you know your finances are operating correctly.