Like any business, healthcare providers must generate a profit to cover operational expenses. Unfortunately, the typical healthcare revenue cycle can be a complex and clumsy process, all too often leaving patients with duplicate bills, lost payments, and repeated arguments with health insurance companies. To properly manage the healthcare revenue cycle, hospitals and private practices must explore innovative approaches to securing revenue firmly grounded in a thorough understanding of existing processes. Read on to learn more about the healthcare revenue cycle and how technology can streamline everything from communications to collections, helping you to provide better service for your patients.
What Is the Healthcare Revenue Cycle?
Essentially, the healthcare revenue cycle encompasses everything involved in calculating, collecting, and managing revenue owed by patients for services rendered. Due to the sheer volume of providers, coverage plans, and treatment options, healthcare billing is an intrinsically complicated system that can be quite challenging to navigate. Any inefficiencies or inaccuracies in the healthcare revenue cycle undermines patients' quality of care, making it imperative for facilities to improve their approaches to pre-approval, claims processing, and collections.
How Does the Healthcare Revenue Cycle Work?
The healthcare revenue cycle is a multi-faceted process involving constant intercommunication and collaboration. Although the process involves many moving parts working in tandem together, it’s much easier to understand by closely examining each step involved. This is how the healthcare revenue cycle operates:
First, a healthcare facility will gather basic data on the patient, including their medical history, contact details, and preferred payment method. This information is then reviewed to ensure the patient meets basic eligibility requirements. In many cases, this initial step of the healthcare revenue cycle can be done over the phone.
Next, the facility will seek pre-approval from the insurance provider on the patient’s behalf. The application or pre-approval process also includes communicating payment details to the patient, such as how much the insurance provider will likely cover and when medical bills should be paid. Accuracy is critical during the pre-approval stage to avoid faulty cost estimates, approval delays, or denial of coverage from the insurance provider.
2. Submit a Claim
Following treatment, the facility will submit the bill in the form of a claim to the respective insurance company. This is done by a trained medical coder who knows how to convert diagnoses, procedures, and treatments into a concise, abbreviated code that’s easier for insurance providers to process.
Carefully examining claims for accuracy before submitting them is essential to ensure timely approval. In a process known as scrubbing, facilities will often use third parties to identify and fix any coding mistakes before the claim is sent. This can prevent time-consuming issues with claim adjustments or denials that impede revenue collection efficiency. With the claim properly coded and sent to the insurance provider, reimbursement for services rendered may proceed.
3. Claims Adjustments
In general, insurance companies will do anything to avoid paying out for virtually any treatment. After a provider denies coverage, the facility will work to seek adjustments in their favor. Any disputed charges will be sent back to the facility in the form of remittances or adjusted invoices of the amount billed versus the amount paid. In some cases, these remittances occur due to coding inaccuracies or denials of coverage for particular treatments and services.
To maximize revenue, practices must consistently track denied claims, fix any errors, and resubmit the updated information within a predetermined amount of time. For remittance appeals, this time frame is usually between 30 and 150 days, depending on the provider.
If an insurance company does not cover the full amount of treatment or there is no insurance, then the facility will have to pursue payment with the patient. To encourage prompt reimbursement, facilities should strive to discuss copayments and deductibles with patients as soon as possible, offering flexible payment options if needed to pay down larger amounts over time.
This part of the healthcare revenue cycle may be expedited ahead of time by verifying the accuracy of pre-approval criteria and coverage details before the patient receives treatment. This way, facilities can educate patients on exactly what services their insurance covers and what will need to be paid out of pocket.
By providing an accurate cost estimate upfront, patients will have a comprehensive picture of what they can expect to owe, making them more comfortable with paying down the remaining balance either all at once or in installments. Only after all efforts are exhausted to procure payment from patients should facilities consider getting a professional collections agency involved.
Technology and the Healthcare Revenue Cycle
The emergence of innovative technologies can help address healthcare revenue cycle issues by improving communication, automating applications, and encouraging patients to pay on time. However, outdated, poorly performing software can make matters worse by over-complicating an already complex process. For this reason, healthcare leaders must carefully choose the best available technology to augment and simplify their existing revenue cycle procedure, from pre-qualification to patient collections.
Healthcare facilities can eliminate coding errors, minimize claim appeals, and ultimately collect more revenue faster than before with the right software and tools. By automating much of the healthcare revenue cycle process, clinics and hospitals alike can drastically reduce human errors that negatively impact patient care. The right technology will also free up labor and resources once devoted to processing insurance claims. Automating the revenue cycle process can thus drastically reduce wait times for patients while giving personnel more time to provide personalized care to every patient.
At QliqSOFT, our goal is to provide an integrated platform to handle every aspect of your healthcare revenue cycle. Our solutions make it possible to reduce the strain on healthcare workers by automating scheduling, streamlining communication channels, and improving the accuracy of patient data or claims. Our AI-driven healthcare chatbot can answer many frequently asked questions from patients, speeding up triage and providing time-saving self-diagnosis information at the push of a button. To learn more about how QliqSOFT can enhance operations at your facility, visit us online today to request a demo completely customized to suit your unique needs.
A lifelong communicator, this Tennessee native got his start in broadcast news before branching out into public media, corporate, communications, digital advertising, and integrated marketing. Prior to joining QliqSOFT as the company's first marketing team member, Ben shared his talents with organizations that include the University of Alabama, iHeartMedia, and The Kroger Company.
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