What to Expect from Revenue Cycle Management Companies in 2024?
by BillingFreedom | Apr 16, 2024
As we enter 2024, the healthcare industry is at the forefront of a technological revolution, exerting a profound influence on patient care and the operational dynamics of medical practices. Revenue Cycle Management (RCM) is a critical area of emphasis in this transformative period.
The escalating growth of the global revenue cycle management market underscores the importance of delving into what lies ahead for RCM companies in 2024 and the significant role that artificial intelligence (AI) is poised to play in shaping the future of healthcare.
Healthcare Industry’s Adoption of Advanced Services
These systems’ distinct advantages and advancements drive the demand for advanced services in the healthcare industry. However, limited IT infrastructure and budget constraints impeded market growth. According to a 2021 article by HIT Consultant Media, 60.0% of surveyed individuals identified budget constraints as the primary reason for not implementing AI and other advanced technologies in revenue management services.
Concerns about safeguarding confidential patient and healthcare facility data also contribute to limited demand for these services. A June 2023 report by IBM Security highlighted an increase in the cost of healthcare data breaches worldwide from approximately USD 9.23 million in 2021 to USD 10.92 million in 2022. These uncertainties are slowing down the adoption rate of such services and consequently restraining overall market growth.
Major Players in Healthcare Revenue Cycle Management (RCM)
- Allscripts Healthcare, LLC (U.S.)
- Cerner Corporation (U.S.)
- Conifer Health Solutions, LLC (U.S.)
- Epic Systems Corporation (U.S.)
- GeBBS Healthcare Solutions (U.S.)
- MEDHOST (U.S.)
- McKesson Corporation (U.S.)
- Medical Information Technology, Inc. (MEDITECH) (U.S.)
- Optum Inc. (U.S.)
- R1 RCM, Inc. (U.S.)
Key Industry Developments:
- October 2022: Nym Technologies SA introduced a radiology coding solution, enhancing automation in emergency departments, urgent care, and radiology facilities.
- August 2022: Revecore Technologies acquired Kemberton and Cura Revenue Cycle Management, LLC, bolstering its capabilities and aiming to deliver improved outcomes for health systems in the U.S.
- June 2022: Olive launched its Autonomous Revenue Cycle (ARC), a comprehensive suite of solutions that emphasizes a shift towards patient care and alleviates employee workload.
- October 2021: R1 RCM, Inc. announced an extension of its partnership with American Physician Partners until 2031, focusing on continued growth in emergency medicine.
What are the Types of Healthcare Revenue Cycle Management (RCM) Available in the Market?
Healthcare Revenue Cycle Management (RCM) encompasses various processes that healthcare providers use to manage the financial aspects of patient care. The types of RCM solutions available in the market include:
Patient Scheduling and Registration:
Systems that help schedule patient appointments efficiently and manage the registration process, ensuring accurate patient information for billing purposes.
Eligibility Verification:
Tools that verify patient insurance coverage and eligibility before services are provided, reducing claim denials and improving upfront payment collection.
Charge Capture:
Solutions for accurately recording and capturing all billable services and procedures to ensure proper reimbursement from payers.
Coding and Clinical Documentation:
Platforms that assist in proper medical coding and documentation, ensuring that services are coded accurately for billing purposes and compliance with regulatory requirements.
Claim Submission and Adjudication:
Systems for submitting claims to insurance payers, managing the adjudication process, monitoring the status of claims, and identifying and resolving issues that may lead to denials.
Payment Posting:
Tools to streamline the posting of payments received from patients and insurance companies, ensuring accurate accounting and reconciliation of financial transactions.
Accounts Receivable Management:
Solutions for tracking and managing outstanding payments, following up on unpaid claims, and optimizing the accounts receivable process to improve cash flow.
Denial Management:
Platforms that help identify and address the reasons for claim denials, facilitating the appeals process to maximize reimbursement and reduce revenue leakage.
Patient Billing and Collections:
Systems that generate patient bills provide payment options and support collection efforts, helping healthcare providers collect payments from patients promptly.
Analytics and Reporting:
Tools that offer insights into key performance indicators, financial metrics, and trends, allowing healthcare organizations to make informed decisions and optimize their revenue cycle processes.
Integration with Electronic Health Records (EHR):
Seamless integration with EHR systems ensures a cohesive flow of patient information and clinical data, promoting accuracy and efficiency in the billing and revenue cycle processes.
Compliance and Regulatory Support:
Solutions that assist healthcare providers in adhering to regulatory requirements, coding standards, and billing regulations to avoid penalties and ensure compliance.
End-user Analysis in Healthcare Revenue Cycle Management (RCM) Solutions for Hospitals
The end-user landscape in the Healthcare Revenue Cycle Management (RCM) market is critical for understanding the dynamics of adoption and growth. In 2022, the market was segmented into hospitals, physician’s offices, and other entities, with hospitals emerging as the dominant end-user.
- Hospitals Dominate the RCM Market:
- Key Contributing Factors: Hospitals' ascendancy is attributed to the continuous rise in patient admissions, which results in increased revenue streams. To effectively manage the complex revenue collection process, hospitals have embraced RCM solutions, bolstering the growth of this segment throughout the analysis period.
- Case in Point: A noteworthy survey conducted by AKASA in 2021 highlighted that over 78.0% of hospitals in the U.S. have integrated RCM services into their operations. This widespread adoption is a testament to hospitals’ inefficient revenue cycle management.
- Surge in Physician’s Office Adoption:
- Driving Factors: The principal driver behind this surge is the global increase in physicians, particularly those operating in physician offices.
- Statistics Support Growth: According to data from the American Medical Association, nearly 49.1% of patient care physicians were based in physician offices in 2020. This substantial increase in the physician count within office settings has fostered a proportional rise in the adoption rate of RCM solutions, robustly supporting the growth trajectory of this segment.
FAQ's
What is the biggest obstacle to good revenue cycle management?
According to a recent report by The SSI Group, LLC, the biggest obstacles to good revenue cycle management in 2024 are claim denials and administrative complexities. Claim denials pose a significant financial challenge, with over 1 in 5 providers losing $500K in annual revenue due to this issue.
The report highlights that while offering higher payment per claim, commercial payers tend to have longer payment cycles, involve more administrative processes, and experience higher frequencies of claim denials compared to Medicare. This situation negatively impacts the accounts receivable metric, further complicating healthcare providers' financial management.
In addition to claim denials, administrative complexities contribute to challenges in revenue cycle management. These complexities include ineffective billing and collections processes, difficulties implementing health information technology, insufficient staff education, poor communication between physicians and financial staff, inefficient registration processes, and reliance on legacy patient billing processes lacking automation and mobile device integration.
Addressing these administrative hurdles is crucial for improving the overall effectiveness of revenue cycle management in healthcare organizations.
What is the goal of revenue cycle monitoring in the future?
The goal of revenue cycle monitoring in the future is to enhance overall financial performance and efficiency in healthcare organizations. Key trends and predictions for revenue cycle management in 2023 and beyond emphasize several strategic objectives:
- Monitor Contract Underpayments: The goal is to ensure revenue integrity by closely monitoring and addressing any underpayments from insurance contracts. This involves proactively identifying discrepancies and resolving them to optimize reimbursements.
- Automate the Revenue Cycle: The objective is to leverage automation to reduce errors and improve efficiency throughout the revenue cycle. Automation can streamline processes, enhance accuracy, and expedite tasks, ultimately contributing to a more effective financial management system.
- Improve Patient Engagement: Engaging patients in the revenue cycle aims to enhance collections and reduce claim denials. By keeping patients informed and involved in the financial aspects of their healthcare, providers can improve payment compliance and overall revenue.
- Leverage Data Analytics: The goal is to use data analytics to identify trends, patterns, and areas for improvement within the revenue cycle. By analyzing data, healthcare organizations can make informed decisions, optimize processes, and enhance overall financial performance.
- Streamline the Claims Process: The objective is to streamline the claims process to reduce denials and improve collections. Simplifying and optimizing the submission and processing of claims can lead to more efficient revenue cycle management.
- Improve Staff Training: The goal is to enhance staff training to improve efficiency and reduce errors. Well-trained staff members are better equipped to navigate the complexities of revenue cycle management, contributing to smoother operations and better financial outcomes.
- Reduce Administrative Complexity: The objective is to minimize administrative complexity to improve efficiency and reduce errors. Simplifying administrative processes, including billing and collections, contributes to a more streamlined and effective revenue cycle.
What Can Be Expected From Revenue Cycle Management Companies By Medical Billing Companies In 2024?
In 2024, revenue cycle management (RCM) companies are expected to be important in optimizing healthcare providers’ revenue performance. These companies will continue to provide medical billing services that streamline administrative processes, enhance efficiency, and minimize errors. Automation, data analytics, and increased patient engagement will be critical focuses for improving the overall RCM process.
Companies will monitor contract underpayments, streamline claims processing, prioritize staff training, and work towards reducing administrative complexities. This evolution in RCM services reflects a commitment to leveraging technology and strategic approaches for effective financial management within the healthcare industry.
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Medical billing service providers must address challenges within the healthcare revenue cycle to ensure optimal financial performance. Insights from Revenue Cycle Management (RCM) companies highlight claim denials as a primary issue affecting healthcare revenue. Overcoming these obstacles is essential for streamlining the billing process and maximizing revenue for healthcare providers. |
Why Choose BillingFreedom?
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