7 Big Revenue Cycle Management Challenges Along With Solutions

A considerable number of hospitals now rely heavily on the revenue cycle process in order to collect payments from patients and their respective insurance payers. But along with comfort comes certain challenges that hospitals must grasp how to handle otherwise it could result in revenue loss.

Today you’ll know some big difficulties that arise during the revenue cycle for bill collection. We’ll also provide solutions to help you get rid of these challenges.

7 Big Revenue Cycle Challenges

If you are a health practice or even one of the staff that performs RCM, you must know the challenges associated with RCM. Getting yourself aware of these difficulties not only keeps your service updated but also provides excellent health services to the patients. Here are 7 of them:

Limited Patient Access

People today are more interested in accessing banks or other paying activities online. They prefer to perform their work digitally, just by sitting at home. For most of the tasks, they make use of digital software to make their work easier. When it comes to paying hospital bills, patients also want to have a digital reception of the hospital, that they can use to book appointments, get health consultancy and pay their bills. 

Digital media transformed the way a patient gets health services. There should be easy and mobile-oriented access to such initiatives for patients that provides the option of multiple payment methods. One way to do this is by introducing automated systems. It makes the customer journey satisfying and reduces the risk of claim rejection due to manual errors.

Low Collection Rate

High deductibles and medical bill rates put an extra burden on patients. They are unable to pay such extensive charges upfront or even after the treatment. They mostly go for multiple payment plans that help them reduce their bill and pay off their total charges. Which results in lacking revenue for the hospitals.

To make the revenue cycle process efficient, health practices must introduce updated and simple revenue collection strategies that boost their financial capacity. One way to quick revenue generation is to provide patient-suited payment methods. 

You must also help patients by providing an estimate of the cost of the service they are willing to take. This way they can better prepare in advance to pay the bills. That also helps you generate revenue that could be lost or slowed down due to difficult payment means for patients.

Medical Bill Errors

Billing errors are a synonym to claim denials. A claim might contain a number of errors, but the result is the same, and that is denial. Unfortunately, after spreading extensive awareness about claim application errors and how to avoid it, still, the rate of claim denial keeps increasing. The biggest reason for this is manual work.

Manually preparing claim applications doubles the chances of containing wrong codes, patient information, and service charges. That insurance company rejects it in the first go. Each claim rejection slows down the reimbursement process by 16 days.

To avoid claim denials, the only solution is to employ automated revenue cycle systems. Several companies provide RCM software that manages multiple claims at a time. Not only managing, but this software also resolves the claim and returns for approval, saving time and staff expenses.

Underpayments During Contract

Underpayment is another great challenge that is faced by many health practices during revenue cycle management. Usually, underpayment issues happen when working on paying contracts with patients. These issues may arise due to the lack of patients and their health service information. To avoid this, you must have ample data at hand when negotiating contracts with the patients.

If that seems complicated, you can get help from multiple revenue management companies that perform information management tasks for you. 

Healthcare Regulation Updates

With the rapid change in technology and patient health service consumption methods, new rules and regulations come up. These updates are constant and it is required hospitals always keep up with them. Otherwise, you could lose your revenue and your financial stability as well. 

To mark yourself safe from rapid regulation updates of the revenue cycle, there are many online resources that you must keep an eye on. You can also follow large health or RCM service providers that can help you stay updated with the trend and protect your revenue wealth.

Lack Of Data-Driven Decisions

Data analytics helps in almost every industry of the world to make your approach specific, and the revenue cycle is no exception. Almost all hospitals and their claim processes run over an anticipated approach, in which they expect their claims to be approved. If the claims are rejected, hospitals work on every single application to resolve the payer objection. But is that going to work in future? 

Sometimes, a low amount of claims may be made error-free and that is considered only “Ok” for small health practices. But if we talk about big health institutes, claims are submitted at a number of high rates. In that case, only applying data analytics or making data-driven decisions will help them in approving their claim.

Implementing data on the revenue cycle also helps identify repetitive mistakes, so you can focus on avoiding them in the future to defend against revenue loss.

Security Issues

Digital patient portals involve inserting every single detail including personal and insurance information and in most cases, bank account details. As these portals keep the revenue cycle digitalized and centralized, the potential for data hacking and theft has seen a hike. This not only results in a lack of trust by the patient but also in facing serious revenue delinquency.

To protect your patients’ and hospitals’ data, you must integrate reliable security programs into your RCM systems. You can also conduct regular safety checks to avoid the loss of sensitive data.

Conclusion

After analyzing these top challenges faced by health practices in the revenue cycle, if you are already associated with RCM or soon going to be, prepare in advance. Follow our tips to tackle these obstacles and never miss a chance to generate revenue.