If you have ever wondered why revenue cycle management in medical billing in the healthcare industry has become more complex; you are not alone. The main driving factor behind this is the intricate nature of medical billing, claims processing, and regulatory compliance. Medical billing carries a very critical area, and that is Revenue Cycle Management (RCM) for healthcare, which puts healthcare organizations in a state where they often face difficulty in maintaining efficiency. Administrative costs that are part of RCM make up a whopping 15-25% of healthcare costs in the United States.
This is just the tip of the iceberg, but don’t worry—this blog has everything you need to address all your concerns and explain how automation in RCM can help you reduce costs, streamline the process, and, importantly, boost your Healthcare Collections.
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Streamlined Processes
If you didn’t know, there is a secret sauce that helps you boost your entire billing and collection process, and that is RCM automation. Once you have that, you will see drastic changes in how your process is optimized, from claims submission to final payments. Manual processing of claims is inclined to errors and delays; in fact, studies have shown that over 90% of claims that are denied could be avoided with proper automation of RCM. Automation makes sure that the claims are submitted with the precision of coding and compliance, which significantly reduces denials and reworks.
Automation has become necessary because it has shown so many great results which were never possible with manual claim submission. According to the Black Book survey, there has been a 27% Cost reduction in collections and an over 6% increase in financial health of healthcare organizations that have automated their revenue cycle management. This is a clear sign that shows what impact this automation carries when implemented. It enhances:
- Repetitive Workflows
- Minimizes Manual Errors
- Boosts the Submission Process
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On the other hand, McKinsey predicted that by 2025, automation would create a $350 billion to $410 billion annual value for the healthcare sector, which highlights the staggering potential of automated RCM systems.
Enhanced Patient Engagement
Automation has a dual impact; it enhances back-office efficiency and improves the patient’s experience, which is the most important. In RCM healthcare, verifying patients’ eligibility and coverage is time-consuming. If this is taken care of with manual verification, then R.I.P your healthcare business, because you will face verification errors that will lead to denials and delayed payments. But with automation in medical billing, you can avoid all of this; the process becomes instantaneous and accurate.
Healthcare providers can quickly check the eligibility of patients and make sure that the claims have been filed with accurate details by using automated systems. This will take the burden of administrative tasks off the patients’ shoulders, thus increasing patient engagement overall. That will let the patients stay satisfied with their care and make them pay their bills on time, which directly impacts the bottom line of healthcare organization.
Implementing automation prominently enhances the experience of both the staff and patients. In the Salesforce survey about 79% of healthcare providers have reported an increase in productivity and over 89% reported higher job satisfaction.
Data Driven Insights
Who doesn’t like the real-time prediction of potential issues before they occur? This is exactly what the automation tools that are powered by AI and machine learning do. They offer predictive analysis, which improves the efficiency of RCM. By analyzing historic data of claims, these tools identify trends, predict denials, and adjust the process in real time.
Debt collection analytics helps to fine tune the financial strategies and ensure smooth cash flow for healthcare providers which is only possible by automating the RCM. Healthcare organizations can save between 25% to 50% using robotic process automation according to The Institute for Robotic Process Information and Artificial Intelligence. Which strengthens the claim of financial advantage that can be achieved with automation.
Reduced Administrative Burden
Automation in accounts receivable, among other processes has a significant advantage in reducing administrative burden which ultimately increases productivity. Like registration of patients, coding and posting of payments are time consuming and are subject to errors. In this case automation will help to avoid all these tedious tasks while providing the opportunity to healthcare practitioners to enhance their operations without the need to hire additional staff.
In 2022 a women’s health physician was faced with quite a challenge, that was to provide good faith estimates to their tens of thousands of patients. It was also the time when the No Surprises Act came into effect. The approach they adopted was quite fascinating and despite hiring 4 to 8 full-time employees (FTEs) they opted for automated good faith estimate software. They saved a staggering amount between $177,000 and $344,000 which they could have spent on labor cost. AKASA study shows that over 26% of healthcare leaders will be implementing the automation in their revenue cycle within the next 2 years and more organizations are looking to adopt these tools that will help them in efficiency gains and cost savings.
Improved Compliance
Healthcare billing is always dealing with compliance challenges, and under the umbrella of regulations like HIPPA and ICD-10 healthcare must be extremely diligent. In this case manual processes are totally a red flag because this could lead to errors, denials and compliance risks. Whereas the automation is the key in keeping the coding standards up to date while adhering efficiently to regulations
Automation intelligently analyses the contracts and points out the discrepancies in payer agreements. By using the same method TeamHealth won around $10.8 million from United Healthcare in underpayment, which would have never been possible with manual process. Automated systems for payer contract analysis can effectively prevent the costly discrepancies, otherwise in Alabama over 100 hospitals would not have been suing the Blue Cross for $5 billion claiming they were underpaid. They were only able to do with automated RCM.
National Association of Healthcare Revenue Integrity released a survey in which it is seen that 73% healthcare organizations have admitted that with their automated RCM they have seen a positive impact on their revenue with the improvements in their compliance and revenue outcomes.
Performance Tracking & Reporting
Performance tracking and reporting enhances the workflow for any organization. Automation of RCM helps organizations make informed decisions by offering real time insights into the revenue cycle. Healthcare providers can have collections optimizations with performance indicators such as debt collection metrics and predictive analysis.
Faster reimbursement cycles and financial reporting have been seen by organizations which have integrated automation tools into their RCM. Shown in the survey released by Black Book. Healthcare organizations can quickly identify and address issues by automating the reporting process which ensure continues improvements in their collection performance. Â
Take Control of Your Revenue Cycle with CollectCo
Healthcare organizations have seen significant improvements in medical debt collection in terms of efficiency, revenue and patient satisfaction automating their RCM. This has helped them to reduce the claims denials and has helped them lower the administrative burden thus improving their compliance and data-driven decision making.
CollectCo specializes in providing healthcare organizations with revenue cycle management rich with state-of-the-art automation which is tailored to their specific and unique needs. If you want to reduce your cost of collection and want to enhance your compliance with payer contracts, this software automates your RCM processes to allow greater efficiency and faster medical debt collection.
Schedule a demo today to learn how CollectCo’s innovative solutions can help you reclaim the revenue you’ve already earned and take your healthcare collections to the next level.
