The Crucial Difference between Medical Billing & Revenue Cycle Management

COVID-19 wreaked havoc on the entire world. There was a lot of financial uncertainty in the earlier stages, which is probably still being addressed. Healthcare institutions were no different. Both small and large practices suffered considerable losses in revenue.

Patients were staying at home in large numbers. People were terrified to go outside among the crowds, and most were concerned about poorly ventilated areas where the virus could linger longer. As a result, patients delayed routine examinations and tests. Some people were skipping critical operations that had previously been scheduled for a long time.

You, as a provider, may still be dealing with the ensuing income loss. Paying close attention to your organization’s financial strength is now more crucial than ever. You may believe that you have this process under control. Your patient and insurance billing systems appear to be beneficial to your practice.

However, billing is one aspect of the financial management process known as revenue cycle management.

Medical billing and revenue cycle management- Are they the same?

No. Medical billing and revenue cycle management are two distinguishable endeavors. If both go right, practices can grow and glow. But it wouldn’t be wrong to say that revenue cycle management is a much more complex and interconnected process, and billing is just one part of it.

Revenue cycle management is vital to the profitability of any healthcare firm. Therefore, billing components are included in revenue cycle management healthcare solutions. RCM, however, extends beyond payment posting. 

Medical practitioners use healthcare revenue cycle management systems to assess, track, and actively manage the status of patient claims on the practice’s accounts receivables. Medical billing service includes the submission of claims for services provided to patients. Following up on these claims with health insurance companies is then addressed. 

Revenue cycle management encompasses more information and processes than we deal with in billing services. RCM is primarily concerned with administering diverse financial transactions resulting from medical encounters. Patients have interactions with medical suppliers, institutions, or healthcare practitioners. These transactions can include the following:

• Billing
• Compliance
• Coding
• Collections
• Data Analytics
• Contracting with Payers
• Enrollment with Healthcare Providers

Many interrelated processes must be involved in RCM. For example, revenue cycle management begins earlier in the process than generating bills and sending them for approval. 

If you are using revenue cycle management software, you will know that it kicks in when a patient schedules an appointment with your front desk. First, a team member must call the insurance provider to confirm the patient’s status and eligibility. At this time, your team will discuss the patient’s bill-paying duties.

Revenue Cycle Management- What is it?

The revenue cycle comprises all administrative and clinical operations that capture, manage, and collect patient service revenue. The revenue cycle involves the following steps: 

1. Medical services are converted into billable expenses through billing tools. 
2. Claims are submitted to insurance companies for billable fees. 
3. Accurate coding of diagnosis and procedures. 
4. Calculate and collect patient balances. 
5. Gather pre-registration information before patients come for inpatient or outpatient services, such as insurance coverage. 
6. Registration: Collecting more patient data during registration to create a medical record number and meet numerous regulatory, financial, and clinical obligations. 
7. Remittance processing: The process of accepting or rejecting remittances. 
8. Collect the payments from third-party insurers.

It is apt to say that RCM is complex but more crucial. Your priority is to keep the lights on and pay your employees. Otherwise, you will be unable to serve patients.

Diving deeper into RCM and Medical Billing

After your practice submits claims, a lot of backend office activity occurs. Processing patient statements and engaging with collections are part of managing the revenue cycle. Consider claims with an error, such as an employee typing the wrong code. The sooner you uncover errors, the sooner you may file a proper claim.

What do your monthly reports tell you about the average time it takes insurers to refund claims? A solid RCM system will improve the efficiency of your organization.

You will benefit from tools such as:

• Daily financial flow statements
• Weekly collecting reports
• Monthly financial health reports to keep track of your practice’s finances

On the other hand, medical billing creates healthcare claims to submit to insurance companies to get paid for medical services provided by providers and provider groups. 

The medical biller tracks the claim after translating a healthcare service into a billing claim to guarantee the organization receives reimbursement for the provider’s work. As a result, a skilled medical biller can improve the revenue performance of a physician practice or healthcare institution.

Capline- At your service today and always.

Capline is one of the best revenue management companies in the US. Capline Healthcare Management gets on board and expertise of over 400 professionals dedicated to providing end-to-end management solutions to healthcare service providers.

If you are keen on improving the cash flow of your practice through unparalleled RCM services, Capline is just a call away. We are a group of highly skilled individuals who strive to provide backend services such as revenue cycle management, credentialing, eligibility verification, medical billing, and collection, etc.