Revenue Cycle Management: What Physicians and Administrators Need to Know
Revenue cycle management (RCM) is an increasingly important part of healthcare IT that focuses on processes that collect revenue from patient care, especially but not exclusively around claim submission and insurance denials. Done correctly, RCM can dramatically lower administrative costs while increasing revenue capture and reimbursement.
In an environment in which claims denials are increasing, recovering or preventing them can provide a meaningful boost to a practice’s revenue. While there is limited data about the impact of RCM on individual practices, one provider of laboratory RCM software suggests that employing a state-of-the-art RCM system increases net collections by 31% on average.
In addition, we can expect the move toward value-based reimbursement to add tailwinds to this trend. In summary, effective management of RCM processes is already very important for most practices and will only become increasingly so in the future.
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