As a healthcare business, you might have experienced insurance claim reimbursements being delayed or denied. This problem can result in lost income and payment, leading to a significant decrease in revenue throughout the year. To avoid this, you need to identify the reasons for claim rejections and find ways to handle them effectively. One of the most successful tactics to overcome this issue is to analyze and evaluate your practice’s revenue cycle. Let’s dive deeper into how you can perform this evaluation and optimize your revenue cycle for practice growth.
Why Are Insurance Claims Denied?
According to MGMA statistics from 2019, several typical reasons lead to insurance claim payouts being refused. The most common reason is the lack of accurate information or stats such as demographic data, procedure codes, or diagnostic codes. Prior authorization is another critical factor that is often overlooked.
Other reasons for claim rejections include failure to meet medical necessity criteria, eligibility problems, payer processing mistakes, practitioners being out of the network, and benefits integration. High rejection rates can lead to a loss of income and payment, requiring your billing team to analyze and resubmit the claim.
Effectively Evaluating Your Revenue Cycle Process?
Performing a thorough revenue cycle analysis can help your practice avoid claim rejections and ensure that you get regular compensation for the services rendered. Some of the significant advantages of decreasing denials include greater profitability. Here are the following components you should consider while analyzing your revenue cycle process:
1. Current Revenue Cycle Processes
Analyzing the billing process is crucial for identifying opportunities for improvement. Your revenue cycle is complex, starting with the registration process and concluding with insurance follow-up. Analyzing the process and its duration for each step of the process can help you identify opportunities for improvement.
2. Staffing Plans
Evaluate your practice’s workforce levels and establish the people required for each stage of the process. Consider variables such as specialty, patient information, and needed technology. This is also an opportunity to address any future personnel demands that may arise due to your new goals.
3. Applied Revenue Cycle Resources
The use of specific technologies is a part of your profession’s revenue cycle. Invest time in identifying the materials and resources used for each activity. Discuss how your team handles the procedure and which resources are most useful to them.
4. Major Performance Metrics
Understanding your practice’s key performance metrics is essential to comprehend your revenue cycle. Identify net recycling rate, days in account receivables, and other performance measures compared to industry best practices. This analysis will help you discover areas of improvement for the future.
How Can You Improve Your Revenue Cycle Process?
Performing a thorough evaluation of your revenue cycle can significantly reduce the number of insurance claim rejections in your practice, resulting in higher income and overall practice efficiency.
RCM services aim to reduce delivery time, prevent refiling expenses and reimbursement waits, and maximize cash flow. We offer expert opinions to help you address what needs to be improved and make the necessary adjustments moving forward.