Keeping your revenue cycle healthy is crucial for the financial stability and operational efficiency of any healthcare organization. Just as we go for regular check-ups to maintain our health, healthcare practices need regular Revenue Cycle Management (RCM) health checks. Let’s dive into why these checks are so important, how they work, and the transformative benefits they offer.
Why You Need RCM Health Checks
Think about it: you don’t wait for your car to break down before you take it to the mechanic. Similarly, you shouldn’t wait until your revenue cycle has major issues to check its health.
Most organizations come to us when they’re already feeling the pain—out-of-control accounts receivable (AR), cash flow problems, or high claim denial rates. By then, fixing the problems is often more challenging and costly. Regular RCM Health Checks help you catch and address issues before they escalate.
The RCM Health Check Process
The Infinx RCM Health Check process is thorough and systematic, designed to give you a clear understanding of your revenue cycle’s strengths and weaknesses. Here’s a step-by-step look at how we conduct these checks:
1. Preparation: We start by gathering some key data. This includes your age trial balance (ATB), 835 files (payer responses), and payment files. These data points give us a full picture of your revenue cycle—gross revenue, net revenue, bad debt expense, cash collections, AR aging, and denial rates.
2. Assessment: Next, we dive into the data. We look at your income statement and balance sheet. On the income statement side, we focus on metrics like gross revenue, net revenue, bad debt expense, and point-of-service collections. On the balance sheet side, we check AR aging—how long it takes to get paid by different payers and how denials are impacting your revenue.
3. Common Findings: Often, we uncover issues such as ignored AR denials, underpayments, and authorization problems. For instance, you might think your over-90-days AR percentage looks good, but when we dig deeper, we find thousands of small accounts piling up. These small amounts can significantly impact your cash flow.
4. Recommendations: Based on our findings, we provide tailored recommendations. These might include improving authorization processes, enhancing coding accuracy, addressing payer issues, and optimizing staff efficiency. Our goal is to help you make changes that will have both immediate and long-term benefits.
Transformative Benefits of Regular RCM Health Checks
1. Improved Cash Flow: By identifying and fixing inefficiencies, you can ensure claims are processed more efficiently and payments come in on time. This leads to more stable finances and reduces the strain on cash reserves.
2. Reduced Denials: Regular health checks help you identify why claims are being denied. Implementing strategies to reduce denials improves cash flow and reduces the administrative burden of managing denied claims.
3. Enhanced Operational Efficiency: RCM Health Checks often reveal process inefficiencies. Fixing these issues can optimize staff usage, reduce administrative overhead, and improve overall efficiency, allowing your team to focus on higher-value tasks and improving patient care.
4. Long-Term Financial Stability: Regular RCM Health Checks ensure your revenue cycle operates smoothly. By proactively addressing issues, you can avoid major financial disruptions and invest in growth and improvement initiatives.
Minimizing Disruption During Health Checks
Worried about disruption? Don’t be. The process can be tailored to minimize any impact on your daily operations. Data collection is routine, and the analysis is efficient. Whether you opt for a comprehensive assessment or a quicker, less invasive check, there’s an option that suits your needs.
Getting Started with RCM Health Checks
Ready to get started? Contact a trusted partner like Infinx. The process is straightforward: we’ll begin with an initial consultation to understand your needs, followed by data collection, analysis, and tailored recommendations. Establishing regular RCM Health Checks will ensure ongoing financial health and operational efficiency.
The Vital Role of Regular RCM Health Checks
Regular RCM Health Checks are essential for maintaining a healthy revenue cycle and ensuring long-term financial stability. By proactively addressing inefficiencies and potential issues, you can improve cash flow, reduce denials, enhance operational efficiency, and achieve sustained growth. Whether you do this internally or with the help of experts like Infinx, RCM Health Checks are a vital investment in your practice’s overall health and success.
Think of RCM Health Checks like keeping your car in top shape. Don’t wait for the warning lights—make sure your revenue cycle is running smoothly today.
RCM Health Check Frequently Asked Questions:
What exactly is an RCM Health Check, and how does it differ from other financial assessments?
An RCM Health Check is a data-focused assessment that examines various components of the revenue cycle from both income statement and balance sheet perspectives.
It differs from other financial assessments by its comprehensive analysis of gross revenue, net revenue, bad debt expense, AR aging, and denial rates.
What are some common issues discovered during an RCM Health Check?
Even if you think you’re doing well, you still may have some overlooked revenue cycle issues. Here are some common findings from past clients:
- Ignored AR denials
- Underpayments
- Authorization problems
- Small accounts piling up that can significantly impact cash flow
What are the key steps involved in conducting an RCM Health Check?
The key steps include:
- Preparation (data collection)
- Assessment (data analysis)
- Identifying common findings
- Providing tailored recommendations to improve the revenue cycle
How long does a typical RCM Health Check take?
A comprehensive RCM Health Check usually takes about a month and a half, including data collection, analysis, and reporting. A Quick Health Check can take around two to three weeks.
How much does an RCM Health Check cost?
The pricing depends on how in-depth of an assessment you are looking for. Choosing between the two depends on your immediate needs, budget, and the complexity of the issues you suspect in your revenue cycle.
A Quick Health Check: Ideal for a fast, high-level overview with minimal disruption and no cost.
This option provides a fast, high-level overview of your revenue cycle’s key metrics and critical issues, including data collection on ATB, 835 files, and payment files. It identifies major problems and offers basic recommendations to improve processes with minimal disruption to daily operations.
Cost: This service is typically free of charge and is completed within two to three weeks.
A Comprehensive RCM Health Check: Best for a deep, thorough analysis with detailed recommendations, suitable for addressing complex issues and long-term strategic planning.
This option delivers an in-depth analysis of your entire revenue cycle, examining both income statement and balance sheet metrics. It involves extensive data collection and detailed assessment to identify systemic inefficiencies and provide tailored, strategic recommendations for long-term improvements.
Cost: This service usually costs around $10,000 and takes about a month and a half to complete, which can be credited back if additional services are purchased later.
Will the RCM Health Check disrupt daily operations?
The process can be tailored to minimize disruption, with options ranging from comprehensive assessments to quicker, less invasive checks. Data collection is a routine task, and analysis is conducted efficiently.
What kind of financial improvements can be expected after implementing the recommendations from an RCM Health Check?
By identifying where RCM workflows should improve and adopting our recommendations, our clients have seen the following benefits:
- Better cash flow
- Reduced denials
- Enhanced operational efficiency
- Long-term financial stability
How can I get started with an RCM Health Check?
Watch our recent webinar to learn more about RCM HealthChecks and book a demo to learn more about RCM Health Check for your organization. An initial consultation will be conducted to understand the practice’s needs, followed by data collection, analysis, and tailored recommendations.
