In its simplest form, revenue cycle management, also known as RCM, refers to the lifespan of a patient account from first contact to payment and reconciliation. It includes all the administrative and clinical functions that add to the capture, management, and collection of revenue.  

Apart from the time and money wasted finding and onboarding billing staff, without an expert, cohesive team, the billing process isn’t as watertight as it should be, leading to providers losing revenue in the process.

In addition, poor coding practices also contribute to a loss in revenue. Refer to the next question for more on this topic.

Although medical billing is a vital part of revenue cycle management, RCM  goes beyond and includes both front and back-end processes. Revenue cycle management for medical practices builds a think tank into the billing process with a high amount of focus on analyzing and improving key health metrics on an ongoing basis.

A holistic approach to the medical practice’s revenue cycle optimizes revenue and improves the overall patient experience. By creating and monitoring measurable metrics across the board, a platform for constant improvement is generated. This would essentially lead to an increase in claims paid upon first submission, faster collections, minimized compliance risks, and more.  

The primary reasons for outsourcing RCM relate to operational cost reductions and optimizing income. Maintaining an expert in-practice revenue management team is costly, and staffing problems lead to disruptions that could affect the bottom line of the business.  

Outsourcing the revenue cycle management function of practice not only reduces costs, increases revenue, and solves staffing solutions, but the in-depth analysis and reporting of the entire cycle and the cross-industry transfer of skills and knowledge to the practice leads to a sustainable synergy.