Authored by: Tim Anderson
In late 2023, the Centers for Medicare and Medicaid Services (CMS) finalized a 3.37% cut in Medicare physician payments. With practices navigating fast-rising expenses and increased labor costs, this announcement was not welcome news.
But it’s also an opportunity.
I’ve found that many practices, even the most successful ones, have collections and revenue-optimizing opportunities. And with expenses rising and the recent CMS announcement, there’s never been a better time to optimize your RCM.
If you need guidance on where to start, here are four tips to optimize revenue cycle management healthcare:
1. Stay current with coding changes to recapture lost revenue
Keeping up with CPT and ICD codes isn’t always happening with teams’ busy schedules. Currently, we’re using ICD 10, and soon we’ll move to ICD 11. And when practices don’t stay current, a risk exists around claims kickbacks.
Another problematic area is consistency. Sometimes a practice is current on codes, using them correctly, but not consistently. The result is lost revenue. And of course, the “cardinal sin” of billing is not capturing all charges performed on a patient and allowing revenue to slip through the cracks.
2. Capture every appropriate charge in revenue cycle management healthcare
Capturing every possible charge for a claim is critical, but part of doing that is rooted in efficiency. A couple of questions to consider:
- Do you have processes and systems in your workflow that kick off the moment an appointment is scheduled?
- Do you track what’s going on with a patient as they flow through your practice?
When done correctly, you’ll capture all the appropriate charges, tagging the correct CPT and ICD codes — ultimately promoting a clean claim and getting paid on the first submission.
It’s also important to note your most significant opportunity to make money is on the first submission. Not getting paid until the second or third submission quickly erodes revenue with higher expenses.
Also, leverage your electronic claims billing to its full extent by taking advantage of efficiency-enhancing capabilities. Electronic posting and automating reconciliation are a couple of great examples that help improve revenue cycle management in healthcare.
3. Scrutinize internal payer contract enrollment processes
When optimizing revenue, don’t forget to evaluate your credentialing and payer contract enrollment processes. You’ll want to review the workflows around getting payers the required information to enroll, transact, and get paid.
Practices without solid processes can face many difficulties. For example, United wants different forms than Blue Cross Blue Shield, Aetna needs a different form than Cigna, and government payer requirements also vary. Without solid processes, practices face slowdowns and revenue challenges.
As a result, it’s critical to evaluate your existing processes, identify bottlenecks, and prioritize streamlining processes to get enrolled and paid faster.
4. Adapt to more value-based care in healthcare revenue
As we look to the future, more practice revenue will likely shift from submitting claims to collecting value-based compensation.
For example, perhaps in the future, 70% of your revenue might come from claims and the other 30% from value-based compensation. Having this awareness can help you proactively implement the required reporting processes and tools to prepare for revenue collection changes. And if you’re curious how value-based compensation can work in your favor, we recently gave a breakdown and tips.
Isolate problem areas and proactively address them for future success
As practices move forward, the revenue cycle will only grow more important with the battle of rising expenses and payment reductions, such as the one that CMS recently announced. But if you can isolate and target the areas most likely to make an impact and leverage healthcare revenue cycle management solutions to support improvements, you’ll position yourself more strongly for whatever comes next.
Do you need help solving revenue cycle management healthcare challenges? Let us know — we can help!