What is Revenue Cycle Management?
RCM, otherwise known as revenue cycle management, is the process, largely a financial one, that healthcare systems use to track the entire patient care process, from point of contact (ie. walk in, scheduled appointment) to the final payment of the balance due for the healthcare services that were provided in that patient care episode.
Effective revenue cycle management is one major key to future-proofing healthcare systems in America and is going to require some hard choices and the adoption of new perspectives. Chief among those is a shift in thinking, moving from the view that it is a process, to seeing revenue cycle management as a key organizational asset and developing strategies to maximize that asset.
Revenue Cycle Management Expert Says Stop Managing, Start Optimizing
Brian Paradis, senior partner at CSuite Solutions based in Tampa, Florida, is a recognized expert in healthcare revenue cycle management having served as President and Chief Operating Officer of Florida Hospital’s Central Region and as the Chief Financial Officer for the Florida Division of Adventist Health Systems. In a recent article, he noted that “health systems are in a hurry to prepare by making meaningful investments for the future. The challenge is to figure out where to allocate resources to produce the best return.”
As a solution, he proposes that the key to any health care system’s financial strength and resilience should be investment into the optimization of revenue cycles. The turbulent nature of healthcare in the US calls for a new approach to managing revenue cycles with the perspective that it is more than a process and should instead be viewed as a strategic asset.
Why is Revenue Cycle Management Important in the Healthcare Industry?
To reiterate, revenue cycle management has traditionally been defined as the process that healthcare systems use in the United States to track revenue from patients. The process is initiated when the patient first makes an appointment or enters the healthcare system and ends when all outstanding fees have been settled.
The problems inherent in revenue cycle management have long been a subject of intense debate in healthcare circles and among revenue cycle managers, and it is this narrow definition that CSuite Solutions is disrupting. Because effective management of revenue is vital to the continued operation of healthcare organizations, it is imperative that a broader definition be adopted, one that looks at engagement with the broader organization, identifies niche service and technologies to improve performance and yield, focuses on the development of referral retention strategies and is open to experimentation in small tests of change.
How can the revenue cycle be improved in healthcare?
The idea of developing existing niche services and technologies is one that is particularly promising, particularly in the light of statistics that show that one in five working-age Americans struggles to pay their healthcare bills. New data-driven technologies are available that provide access to patient information that has not been available in the past. Organizations have the opportunity to improve workflows, access additional information and reduce the cost of collections and improve the customer experience.
Some of these new technologies include the replacement of outdated accounts receivable methodologies that typically write off bad debts after exhausting the internal collection process. With the development of sophisticated databases and algorithms, this process can be shifted to addressing zero-based accounts and using technology to identify whether outstanding accounts should be handled internally or outsourced to collection agencies or developing “last in line” solutions.
New Revenue Cycle Strategies for the CSuite
As CSuite Managing Partner, Stephen R. Mason notes, “we see our role as partnering with over-burdened healthcare providers; coming in with a fresh pair of eyes, a unique perspective, a different approach, and many years of experience in different C-level roles in healthcare. This unique perspective allows us to identify and target important areas for growth that might otherwise have been overlooked.”
Brian Paradis is a senior partner at CSuite Solutions, a strategic advisory firm serving health system leaders across the U.S. Most recently, Paradis served as President of Florida Hospital’s Central Region and as the Chief Financial Officer for the Florida Division of Adventist Health Systems. Look for Brian’s book “Lead with Imagination” just released in February 2019 where he shares his experience and insights on how healthcare leaders can regain the power to lead and live life in a changing world by using Imaginative Leadership.
ABOUT CSUITE SOLUTIONS
CSuite Solutions, LLC was founded by an elite group of former healthcare system CEOs and C-Level executives in response to a growing need for fresh solutions and new strategic insights into issues faced by healthcare systems. The national strategic advisory firm works alongside industry leaders to offer healthcare consulting, healthcare revenue cycle management and advise on clinical integration and patient-centered care.