BHA FPX 4009 Assessment 3 The Revenue Cycle Process BHA-FPX4009 Health Care Reimbursement Systems

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Introduction

The financial health of a healthcare organization depends on its ability to generate consistent and recurring funds from the services it provides, collectively referred to as the revenue cycle (RCM). This presentation will educate new hires on the various steps of the revenue cycle process and each individual’s responsibility.

Outline

The following topics will be covered:

• The revenue cycle process
• Their potential responsibilities
• Why the process is important to a care organization
• Challenges that they might face in their work

Revenue cycle (RCM)

Critical stages in this process include:

• Patient registration
• Collection of demographics and payor source
• Rendering services
• Documenting services
• Establishing charges
• Preparing the claim or bill
• Submitting the claim
• Receiving payment
• Managing accounts receivable

Purpose of Each Step

• Pre-claims submission activities
• Comprise tasks and functions from the patient registration and case management areas.
• Claims processing activities
• Capture all billable services, claim generation, and claim corrections.
• Accounts Receivable
• Manages the amounts owed to a facility by patients who received services but whose payments will be made at a later date by the patients or guarantors or their third-party payers.
• Claims reconciliation and collections
• The facility compares expected reimbursement to the actual reimbursement provided by the third-party payers and patient.

Pre-claims

This portion of the revenue cycle is responsible for collecting the patient’s and responsible parties’ information completely and accurately for determining the appropriate financial class, educating the patient about his or her ultimate fiscal responsibility for services rendered, collecting waivers when appropriate, and verifying data prior to procedures or services being performed and submitted for payment.

Claims processing activities

Charge capture is a vital component of the revenue cycle. Charge capture can be accomplished in a variety of ways depending on the technological capabilities of the healthcare facility. The main processes included in this revenue cycle component include order entry, coding and charge generation with the charge description master, coding by health information management (HIM), auditing and review, and claims submission.

Accounts receivable

After the claim is submitted to a third-party payer for reimbursement, the time allowed to remit a payment to accounts receivable begins. Typical performance statistics maintained by the accounts receivable department include days in accounts receivable and aging of accounts. Days in accounts receivable is calculated by dividing the ending accounts receivable balance for a given period by the average revenue per day.

Claims reconciliation and collections

Collections can contact the patient to collect outstanding deductibles and copayments. Remittance advice indicates rejected or denied line items or claims. Facilities can review the RAs and determine whether the claim error can be corrected and resubmitted for additional payment. If a correction is not warranted, reconciliation can be made via a write-off or adjustment to the patient’s account. After the account has been settled, the revenue cycle is completed.

Purpose of Revenue Cycle Management

The purpose of revenue cycle management (RCM) is to improve the efficiency and effectiveness of the revenue cycle process. Each RCM team will develop different goals and objectives to guide their focus and discussions. Some sample objectives follow:

• Identify issues to improve accounts receivable
• Communicate issues with appropriate areas
• Develop educational materials, such as a revenue cycle manual
• Create a map or blueprint for how to bring up new services
• Discuss denials, the appeal process, and successes
• Discuss key performance indicators (KPI) and measures

After an RCM team establishes goals and objectives, team members must define optimal performance for their facility or practice.

Key Responsibilities of Individuals

• Registration clerks collect the patient’s and responsible parties’ information completely and accurately for determining the appropriate financial class
• Educate the patient about his or her fiscal responsibility for services rendered, collecting waivers when appropriate, and verifying data prior to procedures or s