Find out the benefits and challenges of revenue cycle analytics and why revenue cycle analytics implementation is more profitable than outsourcing.
The healthcare industry nowadays is complex, with numerous regulations that frequently change. This makes it complicated for healthcare companies to provide medical services and get paid. Healthcare revenue cycle management (RCM) solutions simplify this process and help reduce labor costs.
What Is Revenue Cycle Analytics?
Revenue cycle analytics is a software solution that manages and optimizes a healthcare company’s revenue cycle. It covers the entire revenue generation process, from the initial interaction with a client or patient to the final receipt of payment. Revenue cycle analytics tracks patient registration data, data on the availability of benefits and insurance, data on payment for services, accounts receivable, etc. A company that implements an analytics solution for RCM is guaranteed to gain more patient loyalty and increase profits.
What Does the Revenue Cycle Analysis Process Involve?
The revenue cycle analytics process involves data collection and integration, followed by the data analysis and key performance indicator (KPI) phase. Next phase: revenue optimization. At the end of the data cycle, analytics provides reports and visual representations. Let’s talk with experts from the software development company Belitsoft in more detail about each of the phases.
Data Collection
This phase involves the regular and consistent collection of operational and financial data from all sources of the provider company. Data is collected from external databases, billing and claims records, personal data of patients and their electronic health records (EHR), etc. The more accurate this data is, the better the revenue cycle analytics process goes.
Data Integration
As mentioned above, the revenue cycle analytics program collects all patient data from various sources of the healthcare provider company. But this data is disparate, so the challenge of a revenue cycle analytics solution is to bring it together. The program algorithms convert the data into a single format. A consistent, standard data format makes info easier to access and analyze.
Data Analysis
Once all the information is collected and integrated, the key phase of revenue cycle analytics begins. It uses modern statistical methods, tools, and algorithms to find patterns, anomalies, and ‘blind spots’ in the revenue cycle to improve it. This phase allows the medical service provider not only to solve problems that have arisen but also to predict possible risks of money leakage.
KPI Monitoring
Revenue cycle performance depends on the provider’s attention to KPI. Revenue cycle analytics allows to track and eliminate the causes of declining performance indicators. For example, the provider will have fewer financial losses if:
- statistics on filing claims and refusals by the payer are very accurate;
- the term of accounts receivable is as short as possible;
- cash collection rates are high.
Revenue Optimization
With the help of the reports that the provider received from the revenue cycle analytics, they can develop a strategy to strengthen and improve their financial success cases. These reports will become clear evidence of highly effective or low-effective cooperation for those companies with whom the provider has signed an agreement.
Advantages of Revenue Cycle Analytics Implementing
Via revenue cycle analytics healthcare organizations can increase patient loyalty and streamline their financial processes. Explore some examples of the benefits of revenue cycle analytics.
Incentivized Patient Payments
A revenue cycle analytics report may show a trend among patients to delay payments for an extended period (e.g., one month). In this case, the healthcare provider can take certain measures to encourage clients to pay for received services on time.
Identified Non-Payments
Revenue leakage can occur unnoticed if the provider is large enough to monitor all processes closely. If a healthcare organization does not regularly charge for a service, revenue cycle analytics can reveal this. Via a charge capture tool, the provider receives assurance that all services are included in the claim.
Identified Claim Rejections
When claims are rejected, the provider may need claim data analytics to determine the reasons for the rejection, as well as their financial implications. For example, the insurance company rejected several claims because the provider’s representatives incorrectly coded the medical service. A company can provide additional staff training or implement an automated service coding solution to solve this problem.
Proven Payer Performance
The number of denials, speed of payments, and compliance with contracts determine the performance of the insurance company with which the provider cooperates. If revenue cycle analytics reveal a payor’s tendency toward underpayments and claim denials, the provider can present them with the analytics report and renegotiate the terms of the collaboration agreement.
Analyzed Revenues and Profitability
With revenue cycle analytics, a provider can check the financial health of their organization and analyze overall financial data (costs, revenue, etc.). If a particular service area is less profitable than competitors, the provider can invest money in staff training or more modern equipment.
Verified Insurances and Benefits
Revenue cycle analytics can identify regular situations where a payer denies a claim because the patient does not have current insurance or benefits. In this case, the healthcare provider can reduce cost risks if they automate the patient registration process and include insurance verification.
Increased Patient Loyalty
Revenue cycle analytics considers survey data and feedback from patients about their financial experiences. If patients show that they feel unhappy because they think the payment process for medical services is difficult, the provider can make communication with patients more convenient and user-friendly.
Identified Potential Risks
For example, a revenue cycle analytics report can provide predictions of various insurance denials based on historical data. In this case, the healthcare provider can change its claims process and minimize the number of potential denials.
Challenges of Revenue Cycle Analytics Implementing
When a provider implements revenue cycle analytics into healthcare practice, some challenges can appear.
Regulations and Compliance
The healthcare industry has HIPAA and HITECH requirements that are mandatory. A healthcare provider can only meet these requirements if they implement strong information security measures and conduct rigorous compliance checks. This set of measures can increase the cost and complexity of implementing revenue cycle analytics.
How to address it?
The cost of revenue cycle analytics can be worth it if the provider also implements healthcare compliance analytics. If a medical provider does not comply with HIPAA requirements, this is fraught with fines, reputational risks, and lawsuits. Healthcare compliance analytics helps healthcare organizations comply with regulations, guidelines, and standards. Via the predictive function of a healthcare compliance analytics provider, a provider can identify and resolve potential compliance issues. And the money spent on implementing healthcare compliance analytics will become an investment.
Personnel Training
Since process automation is still under the control of people, the healthcare provider needs to train staff on the correct use of analytical tools. In addition, staff must be able to interpret revenue cycle analytics reports correctly. Additional staff training can require considerable costs.
How to address it?
The company’s internal standards may change. Previously, an entire department of a large company could control the revenue cycle. Today it is possible to automate revenue cycle management processes by investing in machine learning and AI solutions and assign only one or a few people to work with analytics reports. But before that, invest money in their training.
Change Management
Analytics implementation into a revenue cycle management system requires time to adapt. Several factors determine the healthcare provider’s financial loss during the change period. The first is the cost increase required to modify and maintain the system. The second is a shift in the timing of return on investment (ROI) even though licensed software has already been purchased. Additionally, implementing revenue cycle analytics may cause employee resistance. They may believe that the previous system had no shortcomings and that a new system implementation only complicates the work process.
How to address it?
The provider should make an onboarding plan and provide a budget to go through the onboarding process smoothly. Also, they should prepare employees for the planned implementation of software. The provider can contribute to developing a new HR strategy to engage, train, and reward already trained employees.
In Conclusion
While revenue cycle analytics can be outsourced today, there are several reasons why implementing analytics software will be more beneficial. A healthcare provider can customize the software for their company’s unique needs and control the entire revenue cycle. Also, a one-time, financially significant software purchase and implementation will become more cost-effective than regular outsourcing costs.
Interesting Related Article: “What Is The Purpose Of Payment Analytics?“
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