What is a Revenue Cycle Management (RCM) Software?
RCM software links various administrative and clinical components together with claims processing, payments, and revenue generation. Every quality healthcare information system has a dedicated RCM module built into it.
Why Invest in a Revenue Cycle Management (RCM) Software?
Effective laboratory revenue cycle management systems vitally contribute towards better health outcomes for the patients and hassle-free revenue management by achieving higher rates of error-free claims and minimizing delayed or failed payments.
Lack of Revenue Cycle Management (RCM) Software impacts an organization’s potential
The absence of an RCM-enabled information system incurs billing errors, which will lead to loss of revenue. A steady decline in the overall potential of the healthcare organization ensues once these errors become recurring.
The US healthcare sector ends up paying $125 billion per year, every year for missed revenue opportunities due to errors in medical billing. Such type of errors is common with bills exceeding $10,000 or more (on average, such bills incur $1,300 in error-related loss in revenue).
Another aspect is the time lost in processing a rejected bill. Such a rejected bill may take up twice the processing time for the same revenue generated. Last but not the least, delayed payments from the insurance companies and denied claims cause unnecessary stress to the patient, thus creating patient compliance issues.
Below we present the top five most common medical billing errors which occur due to lack of an updated, modern RCM software:
- Data entry errors
These may include patient name not matching his/her file records, a clerical error in putting in insurance number, and inaccurate handling of multiple insurance providers (when applicable). Manual processing is the main issue underlying all these errors. Digitally streamlined RCM processes take care of these problems with a high degree of accuracy and robustness. For the same reasons, TestDirectly’s lab test scheduling portal has become extremely popular.
- Insurance Issues
Patient’s medical insurance coverage may change with time. It is therefore crucial that each patient’s existing insurance cover is matched with the services that are being requested. Another time-consuming, labor-intensive, and error-prone process is dealing with uninsured patients. Busy healthcare centers struggle with claiming reimbursement from the federal Health Resources & Services Administration (HRSA) program for such individuals. An integrated RCM operating platform’s automation features achieve identification and processing of thousands of such cases within minutes, thus saving precious time and resources, and achieving sustained positive health outcomes.
- Errors with Coding for Diagnosis and Services
This is a complex portion of the billing process and requires the most knowledge and eye for detail. With ever-changing coding manuals, medical practices struggle to keep their claims accurate. Each coded diagnosis must match the code of a requested procedure. This segment of the billing process is notorious for incurring mistakes if performed manually. Even RCM software needs routine updates to account for all of the changes related to different claims processors. However, some of the latest RCM solutions feature No-Touch Auto-Billing technology which can automatically assign appropriate code/s to the case, and auto-bills the payer and the client.
- Delayed Filing and Rejected Claims
Manual paperwork-based healthcare organizations often lose track of paperwork which ends up in missing an insurer’s deadline, resulting in the provider having to bear the cost or risk angering the patient/client. Another related issue is the failure to resubmit a rejected claim in time, again resulting in a loss of revenue. Both of these issues can be curtailed by an automated RCM system that has the ability to retrieve accurate patient demographic data, eligibility, and insurance status, all in real-time.
- “Intentional” Mistakes
Besides the unintended billing errors, healthcare organizations need also to be on the lookout for possible fraudulent activity on part of a patient or impropriety on part of an employee. The unbiased and transparent nature of RCM software ensures that these mistakes are kept at bay.
The Ideal RCM Solution
The ideal revenue cycle management solution is a comprehensive and agnostic part of a healthcare information system platform that provides configurability, efficiency, interoperability, and transparency in the way claims are processed, quality is maintained, errors minimized, and positive health outcomes achieved. The LigoLab’s Laboratory Information System (LIS) and RCM is an example of such a platform. Similar issues also exist in the field of physician dispensing.
Adding further functionality to this system is the frontend add-on, TestDirectly Direct-2-Customer (T2D) which uses an electronic workflow model to improve efficiency, and reduces errors in patient data handling.