Assessing Your Physician Practice’s Revenue Cycle – Step by

Step

Revenue Cycle

Patient scheduling and

eligibility verification

Patient visit/Medical

record documentation

Superbill or charge ticket completed by

provider/patient payment obtained

Coding and billing

completed

Claim processing

Payment received

What is a Revenue Cycle?

• A revenue cycle is the process that healthcare businesses use to describe the financial progression of their accounts receivables from the very beginning, when they first acquire a patient to their practice until they get paid, if they get paid in full. – Revenue Cycle is all administrative

and clinical functions that contribute to the capture, management, and collection of patient service revenue. It is the service point of entry to payment receipt/resolution.

– Knowing how the Revenue Cycle works is important so that you can better contribute to the overall financial health of your practice.

What is the fist step in the revenue cycle?

• The revenue cycle starts the moment that patient calls to make an appointment with:– examining and improving

your front office processes. How you collect patient insurance and demographic information and verify eligibility is critical. Get that wrong, and you will never receive payment for your services.

Patient scheduling and eligibility verification

What is the second step in the revenue cycle?

• Integrating CMS documentation guidelines into daily decision making

• Ensuring that every patient record is complete and compliant with coding standards– Your physicians bill evaluation and

management (E/M) codes every day. E/M coding is an essential part of your practice's revenue cycle and it's also on the Office of Inspector General's (OIG) hit list. This means that it's more important now than ever to accurately report these codes. Conducting an E/M audit will help your practice enhance its revenue and stay under the OIG's radar.

Patient visit/Medical record

documentation

What is the third step in the revenue cycle?

• The next critical step is how you capture charges – or “charge capture." Superbill? Electronic Health Record / Electronic Medical Record? Notecards? PDA? There is no right or wrong way. It is your system.

• However you document your services, those charges must be captured if they are to be billed. – Create a super bill that reflects the most common diagnoses

and procedures performed in the practice. The physician should be able to mark the appropriate diagnosis and procedure codes. Keep the superbill up to date each year!

– Ensure that the ICD-9CM, CPT, HCPCS codes and appropriate modifiers are billed.

– Perform a pre-billing review to eliminate potential medical billing errors.

Superbill or charge ticket completed by

provider/patient payment obtained

What is the forth step in the revenue cycle?

• Coding – – This is often the challenging part

for medical practices. CPT, ICD-9, HCPCS, Modifiers – it is an acronym soup that is constantly changing. It takes experts to code right, the first time, and in compliance with the law. You should be paid for the right service and have peace of mind that the coding is done right.  

• Billing - – Submitting your claim form to the

correct health plan or payer daily starts the clock ticking on your receivables. How many days from the time you took care of a patient (“date of service”) is the bill sent out the door? And is it sent to the right payer?

Coding and billing completed

What is the fifth step in the revenue cycle?

• A serious concern in healthcare reimbursement today is decreased or delayed reimbursement due to claim denials. The challenge is how to quickly identify the source of the denials and fix the problems.

• Education is the key to clean claims. – Providers, front desk, billers and

clinical staff all contribute to the information that is submitted on a claim. Each individual needs to understand how their role impacts claim payment.

Claim processing

What is the sixth step in the revenue cycle?

• Review payments carefully Payers will often make mistakes when processing claims that need to be appealed for proper reimbursement. The person posting payments must pay attention and question anything that does not look right.

• Some things to watch for include:– • dropped or missed procedures

• one procedure bundled into another and paid based on one code instead of two • modifiers dropped that justify bundled procedures • multiple units ignored • payment based on the wrong fee schedule

Payment received

A few questions to ask yourself:• Are you capturing all of the charges for

services you provide?• Are physicians and midlevel providers

productive in comparison with their peers?• Are cash collections low?• Are providers under-coding?• Is the billing staff working payer denials

appropriately?• Is the practice properly collecting from

patients while in the office?• How long between the actual service and

payment from the insurance company?• Are operating costs in sync with practice

volumes and revenues?• Are there bottlenecks that hinder patient

flow?• Are there training issues for the staff?

In closing• Most healthcare consultants will

tell you that the minute a patient calls for an appointment or walks into the medical office and services are rendered, the Revenue Cycle begins.  The Revenue Cycle ends when the proper payments are received and posted by the billing office.  This sounds like a simple process; however, there are many steps and factors that require a coordinated team effort starting from the front desk associate, to the physician, the nurses and finally the medical biller.

Remember results equals success!