Effective revenue cycle management is paramount to maintaining financial fitness for your practice, but shifts toward value-based care reimbursement are reshaping the traditional revenue cycle. Meanwhile, healthcare providers find themselves in a difficult economy that demands they maintain a delicate balance of patient care and internal costs. Outsourcing revenue cycle management can help you achieve this balance by reducing costs, but these best practices are crucial to avoiding problems.
What Is Revenue Cycle Management?
Revenue cycle management in the healthcare industry involves identifying, managing, and collecting revenue for the services a clinic provides. Without proper revenue cycle management, you will struggle to steadily generate revenue. Claims may be processed late or not at all, missed payments may not be sent to collections, and patient care may suffer as a result of clinical and administrative fallout.
The primary reason revenue cycle management can prove difficult is that the life of patient accounts is not a simple 1-2-3 process. The cycle starts with each new appointment and ends when there are no outstanding payments or claims on the patient's account, but that is an oversimplification of the registration, scheduling, medical histories, insurance coverages, claims reimbursement, and other fundamentals that must be handled in between.
Any experienced healthcare professional knows that these processes involve excessive documentation and timely notifications to get the desired outcome, with a single claim process often taking months before finalization. That's why outsourcing revenue cycle management may be the best option for reducing the back-office workload, managing costs, and improving patient care.
Position Your Clinic for Growth
Outsourcing revenue cycle management should guarantee growth on the billing side of things, but the best partner will also be capable of improving and increasing revenue-producing activities.
For instance, many providers began offering telehealth services for the first time in 2020, which introduced many challenges, including learning how to code and bill for these new services. An outsourcing partner can ensure that providers properly document all of their services and bill payers correctly, which expedites the claims process and ensures fewer denials.
Clinics that choose to outsource revenue cycle management cite improved patient care, overall performance, and strategic success. Additionally, they praise the flexibility that an outsourcing partner gives them, which opens the doors to better innovation and quicker adaptation as healthcare professionals continue to face unprecedented challenges.
Better Utilize Internal Resources
By outsourcing revenue cycle management, organizations will find that back-office teams suddenly have far more availability to focus on key activities. For instance, HR will have more time to recruit the right staff — such as specialized nurses, physicians, and medical assistants — to support the clinic's strategic growth and ability to provide exceptional patient care.
Meanwhile, outsourcing also gives other staff the time they need to effectively handle the administrative duties of the clinic, helping to generate more revenue. Those who were previously often assisting billers and coders will be able to return to patient-centric services, which means all-around improvement.
In other words, outsourcing allows a clinic to take the focus off of the time-intensive claims and billing process and put more effort into the clinic's core mission, which is offering personalized health services for the local community.
Maintain Business Independence
In the wake of rapid healthcare consolidation, rising expenses, and the demand for a tech-heavy patient experience, many small providers have struggled over the past few years. Maintaining independence has become an ongoing battle for many providers, but outsourcing non-clinical duties, like revenue cycle management, can take some of the pressure off.
The time- and resource-intensive processes associated with revenue cycle management weigh down smaller providers. Amidst new challenges, the weight is enough to bring a small clinic to a screeching halt. Rather than losing independence, outsourcing these duties puts power back into the team's hands, allowing them to focus on patient care and strategic goals.
In addition to outsourcing revenue cycle management, some providers are also sending care coordination, data and analytics, and other non-clinical services off-site. After all, the benefits of full revenue outsourcing are simply undeniable, and it can be a make-or-break difference for small providers and organizations that are struggling to grow under all the weight.
Revenue Cycle Outsourcing Trends
Many organizations have realized that outsourcing revenue cycle management is the right way forward, which is why the market is poised for major growth. By 2023, the market has an anticipated compounded annual growth rate (CAGR) of nearly 12%. This represents an increased value of $11.7 billion since 2017, bringing the total to $23 billion.
Ultimately, revenue cycle outsourcing is viewed as a highly accessible solution to the rising costs providers are facing with the potential to greatly improve performance in regards to patient care and strategic expansion. The question is, should your clinic outsource revenue cycle management?
TempDev is an end-to-end consulting service specializing in the healthcare industry. As a firm, we help our clients solve problems, including whether and how to outsource, they are trying to solve. Interested in learning more about how we can help you achieve your goals? Contact our team to schedule a consultation with TempDev today.
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