In 2019, a Black Book Market Research study found that 90% of hospital providers1—in their transition to a value-based healthcare system—were actively seeking to create cost-efficiencies in both clinical and non-clinical spaces. And the ongoing pandemic has only amplified the demand for healthcare providers to find clinical cost reduction avenues without sacrificing patient care satisfaction.
For many providers, outsourcing revenue cycle management functions to specialized vendors is a sensible business decision. Of these potential outsourcing avenues, few provide as much value-add as revenue cycle management vendors.
A first-rate RCM vendor can streamline the entire healthcare revenue lifecycle—from booking patients to collecting payments. With the right RCM vendor, your team will optimize your workforce, ensure timely reimbursements, and improve cash flow.
So when you’re wondering what to look for in an RCM partner, you need to ask the right questions.
Asking the Right Questions Starts with Reflection
The revenue management cycle is growing more complicated with each passing year. With the continually shifting reimbursement structures, nebulous policy mandates, and complex medical billing service requirements, it’s no wonder why so many practices in the healthcare industry need help.
But you can’t commit to a partnership without knowing what you’re looking for in one. Revenue Cycle Management vendors must be able to meet your needs and manage every aspect of the following:
- Patient intake – Collecting and verifying a patient’s personal and insurance information and checking off regulatory requirements, such as noting their medical record number.
- Claims coding – Utilizing and accurately inputting ICD and CPT codes for procedures and diagnoses despite continually changing regulations and standards.
- Claims – Assisting with the generation and submission of insurance claims and organizing the explanation of benefits (EOB) for patients.
- Claims denials – Correcting and resubmitting denied claims to the appeals process, typically within a narrow time window.
- Charge capture – Converting every code—whether it’s from a Medicare, Medicaid, third-party insurer, or workers’ comp provider—into a billable charge.
- Accounts receivable – Managing accounts receivable, including follow-ups to decrease the window between claims submission and reimbursement.
- Data reporting – Providing actionable data and insights about how to grow and improve throughout each step of the RCM cycle.
For a deeper dive, discover the Revenue Cycle Management steps that lead to success. Before you begin the hunt for an RCM provider, you must first look internally and consider all of the revenue cycle’s key aspects that impact your bottom line. This introspection can boil down to three critical questions:
- What are the core functions of your billing services?
- What are your weaknesses?
- What are your greatest operational needs?
By conducting this internal company review, you’ll identify the criteria and qualities you’re looking for in an ideal vendor. This knowledge will help you craft appropriate questions that you can use to narrow your search while avoiding substandard vendors.
To guide you along this process, consider these 6 questions to ask when choosing between revenue cycle management vendors.
Question #1 – What is your denial management strategy?
Few aspects of the revenue cycle are more vexing than claim denials. Denials are time-consuming for staff, and even successful claims can hurt your bottom line when done inefficiently. Put simply, claims management can jeopardize a hospital or health system.
In addition to this general question, there are specific follow-ups you should also raise:
- Do they follow up on denied claims?
- Is there a minimum dollar amount threshold that triggers follow-ups?
- What percentage of your denied claims are successfully appealed?
- Do they have denial management in their platform? If so, can you see a demo?
- Do they include a team of experts who specialize in denial management?
Your potential RCM partner should have a fully-fleshed denial management strategy in place—one that addresses denied claims immediately and focuses on prevention, recovery, and escalation.
Question #2 – Do you offer training during the onboarding process?
One of your primary criteria for a new technology platform should always be user-friendliness and ease of learning the system. The goal of an RCM system is to save your staff time by automating time-consuming tasks. But you’ll end up losing efficiency if your team doesn’t know how to utilize the platform to its fullest.
It’s ideal for medical billing services to provide onsite training. This ensures an easy and successful transition to the new services. Onboarding sessions could cover:
- Licensing
- NPI enumeration
- CLIA certification
- Payer mix identification
- Medicare and Medicaid enrollment
- HRSA set up
- Electronic data interchange (EDI) set up
- Coding & billing strategy and implementation
Question #3 – Will they be able to alleviate the three significant revenue challenges?
These days, there are three primary challenges that healthcare providers face which result in possible revenue loss:2
- Increased back-office staff time checking claims
- Increased denials due to incorrect coding or lack of specificity
- Increased documentation time for physicians
Your provider should have a mapped strategy for how they address these three common impediments to success. By working with a top RCM vendor, you can ensure a positive revenue stream without hiring additional staff to increase work capacity.
Question # 4 – What does your pricing model look like?
Typically, an RCM provider will select one of three primary pricing models:
- Pay-per-use
- Subscription model
- Percentage of collections
It’s essential that you consider their pricing model and then weigh the costs against the services provided. Some firms may charge higher rates but offer a more comprehensive solution to the revenue cycle. If your practice or sub-specialty is known for being complicated, you’ll require more services from your RCM provider.
Question #5 – What KPIs do you track to ensure that organizational goals are met?
Your RCM firm should have a clear picture of the key performance indicators (KPIs) they track to ensure that your medical practice remains successful. Their list should include many of the MAP Keys3—the industry-standard metrics for revenue cycle management—including but not limited to the following KPIs:
- Bad debt
- Cash collection as a percentage of net patient service revenue
- Clean claim rate
- Cost to collect
- Days in accounts receivable
- Days in total discharged not billed
- Late charge as percentage of total charges
- Net collection percentage
- Point-of-sale service (POS) cash collections
- Resolve rate
But it’s not enough for them to simply say that they measure these KPIs; you also need to inquire about how they collect and then analyze the information to create actionable insights.
Question #6 – Do you provide dedicated account managers who respond quickly?
It’s not enough to simply have an RCM platform integrated with your ERM. With any technology, issues or problems will inevitably crop up. Knowing this, it’s vital that your RCM provider offers access to a dedicated account manager who gets to know your business and its unique needs.
Ideally, you want a highly-skilled manager who is capable of:
- Answering any questions you might have
- Providing data insights and analytics recommendations
- Troubleshooting
- Managing RCM problems your staff has
- Updating you on changes or mandates from the Centers for Medicare & Medicaid Services
- Tracking down missing signatures
You should look for an RCM provider that will go above and beyond in its mission to help you identify how to increase revenue along with addressing issues before they can negatively impact your cash flow.
Partnering with the Perfect RCM Provider
By outsourcing the revenue management cycle to a specialized vendor, you have the opportunity to optimize your medical practice and support your staff. The ideal vendor can improve your practice’s profitability, reduce your administrative workload, and mitigate disruptions from industry fluctuations.
Want to optimize efficiencies in your core areas of competence while reducing your operational costs?
Healthcents is the solution. Whether you need RCM terminology and management or help with contract negotiations, we provide a holistic managed care program to position your practice for success. Contact us today!
Sources:
- Black Book Market Research. Pressures of Value-Based Care Reforms Trigger Sharp Increase in Clinical Outsourcing Partnerships, Black Book Survey Results. https://blackbookmarketresearch.newswire.com/news/pressures-of-value-based-care-reforms-trigger-sharp-increase-in-21000011
- Greenway Health. Revenue Cycle Management Best Practices Guide. https://himss20.mapyourshow.com/8_0/explore/collateral_redirect.cfm?CollateralID=3682&CFID=5427051&CFTOKEN=337e8a192fe9e4da-1D6E59ED-CBF1-7193-FDBF6BEEFCD8D940
- HMFA. MAP Keys. https://www.hfma.org/MAP/Mapkeys/
