Revenue cycle technology comes in various forms, tailored to the specific needs of healthcare providers, yet these indispensable tools have become vital for ensuring seamless operations within the revenue cycle.
The healthcare revenue cycle represents a vast and intricate operation that encompasses a range of activities, from patient registration and insurance verification to denials management and patient collections. To ensure smooth and efficient operations, healthcare provider organizations of all sizes have embraced revenue cycle management technology.
There exists a diverse array of technologies utilized by providers to streamline various aspects of the revenue cycle, often incorporating several of these tools as part of their management strategy. According to a recent survey of healthcare finance leaders, approximately 30 percent of organizations employ two or more vendors for automating their revenue cycle, while 38 percent rely on a single vendor for all automation steps, and 31 percent have an internal team dedicated to managing revenue cycle automation comprehensively.
Nevertheless, the adoption of revenue cycle management technology by providers continues to expand. Analysts from MarketsandMarkets predict that the global revenue cycle management market will reach $84.1 billion by 2028, driven by heightened technology adoption following the COVID-19 pandemic.
According to the market research firm, newly developed Revenue Cycle Management Solutions play a crucial role in streamlining workflows, enhancing data accuracy, improving compliance, and elevating the overall experience for both healthcare providers and patients. These advanced solutions also offer real-time insights, support seamless data exchange, ensure interoperability, and reduce costs associated with managing multiple standalone systems.
Healthcare providers have already made substantial investments in various revenue cycle management technologies, whether sourced from a single vendor or multiple providers.
7 Types of Revenue Cycle Management Technologies for providers
1. Efficient Practice Management Systems
A crucial component of healthcare practice management, a Practice Management System (PMS) plays a pivotal role in supporting administrative and billing tasks within a healthcare practice. As defined by the American Medical Association (AMA), these tasks encompass a wide range of activities, such as capturing patient demographics, appointment scheduling, preregistration (including insurance eligibility and benefit verification), calculating patient financial responsibilities for point-of-care collections, maintaining payer lists, generating reports, and handling billing processes.
By streamlining day-to-day operations, PMS software significantly enhances the efficiency of healthcare providers, ultimately contributing to the overall success of the revenue cycle and the organization. One of the primary benefits of a PMS is its ability to automate various workflows and facilitate seamless communication among staff members.
For ensuring revenue cycle success, it is crucial that PMS software integrates and coordinates seamlessly with Revenue Cycle Management (RCM) workflows to optimize provider revenue. The PMS can generate patient bills and insurance claims using its data sources, after which the RCM system takes over to ensure accurate and timely submission of claims.
According to a report by MarketsandMarkets, PMS systems can be standalone solutions or integrated, with the latter being more commonly seen in conjunction with Electronic Health Record (EHR) systems. Healthcare providers have the flexibility to choose between on-premises, web-based, and cloud-based PMS systems, with cloud-based options gaining popularity due to their projected segment growth over the next few years.
2. The Role of Patient Accounting Systems in Healthcare
Patient accounting systems play a fundamental role in handling the financial aspects of patient care, encompassing billing, invoicing, claims management, payment processing, and patient statements. Often referred to as a PAS, a patient accounting system differs from a practice management system as it is more closely aligned with revenue cycle management goals, focusing on each individual patient to generate claims and bills. In contrast, a PMS has a broader scope, addressing various administrative and operational tasks.
Healthcare providers commonly deploy patient accounting systems through their Electronic Health Record (EHR) vendors, with well-known vendors being Epic, Oracle Health (formerly Cerner), and MEDITECH. Additionally, some other vendors offer PAS software that integrates seamlessly with a provider’s EHR system. This integration of EHR and PAS facilitates the synchronization of clinical and administrative data, ensuring accuracy in claims and patient billing processes.
The patient accounting system assumes a critical role in revenue cycle management as it efficiently processes reimbursements and patient payments. By automating billing and claims processes, the PAS significantly streamlines revenue cycle management. Furthermore, it contributes to enhancing the transparency of the patient’s financial experience through automation and comprehensive reporting capabilities.
3. Seamless Claims Management and Efficient Clearinghouses in Healthcare
As per KLAS, claims management and clearinghouse solutions are software tools designed to assist healthcare providers in managing claims and submitting them to payers.
A claims management system or software automates the entire workflow of claims, starting from their initial creation to the final payment or resolution. This comprehensive tool typically supports claims adjudication, tracking claim statuses, managing denials, and providing reporting and analytics functionalities. Providers rely on claims management technology to optimize clean claims rates while minimizing claim denials or delays.
On the other hand, a clearinghouse acts as a third-party intermediary facilitating the electronic exchange of information, particularly billing and administrative data. In the context of claims management, clearinghouses play a crucial role in submitting claims to payers on behalf of providers, after meticulously validating and scrubbing the claims to ensure compliance and accuracy. Additionally, clearinghouses handle adjudication and provide claim status updates and reporting. Healthcare providers utilize clearinghouses to expedite claim processing and other administrative transactions, streamline medical claims submission to multiple payer partners, and gain access to enhanced reporting on claim trends.
The market for claims management systems and clearinghouses is diverse, with numerous key players offering their solutions in this domain.
4. Eligibility Verification Solutions
Providers have access to tools and software that leverage technology to verify a patient’s insurance coverage and eligibility for medical services. These tools, appropriately known as patient eligibility verification systems, offer real-time verification of coverage status either before or during patient registration, furnishing providers with comprehensive information about a patient’s insurance benefits.
The significance of patient eligibility verification systems lies in their role in achieving the revenue cycle’s primary objective: maximizing reimbursement. By utilizing these systems, providers can ascertain whether insurance will cover specific medical services before any encounter takes place. If coverage is not guaranteed, providers can then communicate various payment options to patients. Moreover, some advanced systems go a step further by providing estimates of the patient’s financial responsibility.
Furthermore, certain patient eligibility verification systems possess the ability to identify primary and secondary coverage for specific patients by conducting searches across both private and public payers for eligibility information. This valuable capability is often referred to as “insurance discovery.”
As is the case with various segments of the revenue cycle technology market, numerous vendors offer patient eligibility verification solutions, along with outsourcing services. These vendors aim to prevent claim denials, reduce underpayments, and minimize bad debt, ultimately enhancing the financial performance of healthcare providers.
5. Revenue Cycle Analytics in Healthcare
Revenue cycle analytics solutions are powerful business intelligence tools that leverage financial data to assess the performance and efficiency of the revenue cycle. These solutions meticulously analyze data pertaining to billing, claims, collections, and reimbursement to pinpoint trends and areas that require improvement.
An essential aspect of revenue cycle management, these analytics solutions play a pivotal role in measuring and tracking key performance indicators (KPIs). By establishing revenue cycle KPIs, providers can elevate their financial performance and address areas that need enhancement. Revenue cycle analytics solutions play a vital role in collecting and analyzing data related to these KPIs, empowering providers to gain comprehensive insights into their performance.
Data collection, cleaning, and analysis can be both costly and time-consuming for providers, prompting many to opt for technology or software tools that offer quicker and more efficient insights. Additionally, numerous providers lack the internal resources needed to conduct advanced analytics independently.
These revenue cycle analytics solutions may take the form of standalone tools, while some vendors provide them as an integral part of their comprehensive revenue cycle management platform.
6. Patient Payment Solutions
Patient financial responsibility is experiencing a significant surge. According to KFF’s latest “Employer Health Benefits Survey,” the average annual deductible for patients with employer-sponsored health insurance has risen to over $1,700, marking a substantial 61 percent increase since 2021.
This upward trend in patient financial responsibility poses challenges for healthcare providers who have historically relied on payers to cover the majority of medical expenses. However, in response to patients owing more for their care, providers are proactively investing in patient payment solutions to facilitate easy and convenient payment collection from their patients.
Patient payment solutions encompass a range of tools, including online payment portals, point-of-service collection systems, automated payment plans, mobile payment options, and cost estimation tools. Additionally, these solutions often incorporate patient engagement and communication capabilities, such as payment reminders and statements.
Providers leveraging patient payment solutions have observed notable enhancements in self-pay collections, point-of-service collections, and overall patient satisfaction. By offering a variety of user-friendly payment options, healthcare providers can efficiently collect payments from patients while ensuring a positive and satisfactory payment experience.
7. Software for Ensuring Compliance and Conducting Audits
Compliance and auditing software play a crucial role in ensuring healthcare providers adhere to coding and billing rules and regulations. These solutions are designed to identify potential compliance risks and issues within the revenue cycle, which could lead to claim denials, reimbursement delays, and even allegations of healthcare fraud. With capabilities such as audit trail and documentation, claims and coding accuracy assessment, compliance monitoring, fraud detection and prevention, charge capture validation, and internal auditing, these software solutions provide comprehensive oversight and risk mitigation.
Incorporating compliance and auditing technologies into revenue cycle management strategy is essential for providers, especially in the face of an ever-evolving regulatory landscape. These tools not only help mitigate financial risks but also enhance organizational transparency, bolster payment integrity, and promote accountability.
The world of revenue cycle technology offers a diverse array of solutions, catering to various needs and requirements. Providers utilize these technologies, whether they are standalone systems or part of an end-to-end solution, to streamline the multitude of tasks involved in securing payment for patient care. Embracing these technologies empowers healthcare providers to optimize their revenue cycle operations, enhance efficiency, and maintain compliance with industry regulations.
