BlueFish Medical

Choosing an RCM Company: What’s Right for Your Practice?

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A Revenue Cycle Management (RCM) Company handles the billing processes for a healthcare entity (such as a private practice). The revenue cycle can be outsourced to an RCM company in part or in whole, and includes:

  1. Patient pre-authorization
  2. Eligibility and benefits verification
  3. Claims submission
  4. Payment posting
  5. Denial management
  6. A/R Follow-up
  7. Reporting

Should you use an RCM company?

Many private practices have difficulty finding and retaining staff with skills necessary to tackle an increasingly complex billing landscape. (HFMA, 2016) An RCM Company can help a private practice scale up in terms of employee expertise and technological support, and experience more ROI and overall efficiency. If your practice has struggled in these areas, an RCM company may be a good fit.

In addition, taking a look at some Key Performance Indicators (KPIs) can help you assess the current health of your practice’s revenue cycle, including:

  • Days in A/R – the average number of days it takes a practice to collect payments due. (AAFP, 2018) This is an overall measure of how well your billing department is collecting on accounts. Learn how to accurately calculate days in A/R here.
    • Optimal: A/R less than 35
    • Average: A/R 35 to 50
    • Poor: A/R greater than 50
  • Percentage of A/R greater than 120 days – of the items in accounts receivable, what percentage still have not been paid after 120 days. This measures your practice’s ability to be paid in a timely manner.
    • Optimal: Days in A/R greater than 120 is less than 12%
    • Average: Days in A/R greater than 120 is between 12-25%
    • Poor: Days in A/R greater than 120 is more than 25%
  • Adjusted Collection Rate – the overall measure of a practice’s effectiveness in collecting legitimate reimbursement.
    • Optimal: Higher than 99%
    • Average: Between 95-99%
    • Poor: Less than 95%
  • Denial Rate – the percentage of claims denied by payers. If your billing department isn’t submitting clean, paid claims, it’s costing your practice time and money.
    • Optimal: Less than 5%
    • Average: Between 5-10%
    • Poor: Greater than 10%

If your practice falls into the poor or average ranges for any KPI, or worse, you don’t have the visibility into your process to even know where your practice falls, it’s time to consider outsourcing your RCM process. Improving on these KPIs could lead to big gains in your practice’s profitability, and a good RCM company can help.

For physician owners, outsourcing their the management of their practice’s revenue cycle offers the additional advantage of allowing them to focus more fully on patient care. Streamlining operations so that the financial health of your practice is secure and patients are receiving your full attention brings the dual benefits of greater peace of mind and more satisfied patients.

What should you look for in an RCM company?

Generally speaking, these are some items that should be on your list of non-negotiables when considering RCM companies:

  1. Make sure they can integrate with your EHR. In the new world of ICD-10 and increasingly complex reimbursements, it’s more important than ever that information flow smoothly between your clinical and practice management systems.
  2. A domestic labor force. An RCM company that chooses to offshore labor introduces numerous unnecessary challenges, including language barriers, time zone hassles, poor training standards, lack of understanding of U.S.-based medical billing practices, posting errors, etc. Offshored services lead to diminished quality for your practice in the name of increased profit margin for the RCM company.
  3. Visibility into the revenue cycle process. The best RCM companies provide regular reporting on key performance indicators (KPIs), management reports, and benchmarking data. Moreover, the RCM company should provide continuing training to practices on how to evaluate the data contained in these reports.
  4. A philosophy of supporting continuing process improvement in your practice. Data means nothing if it’s not actionable. RCM companies should provide thorough analysis of KPIs and regular help developing action plans to improve results.
  5. Experience serving customers in your specialty. Ask your prospective RCM vendor how many other customers they have in your specialty. If they are arranged in teams, ask if your practice will be placed in a team that is currently billing for other providers in your specialty. The vendor should also be able to provide you with references of other clients within your specialty.

How can BlueFish Medical help with your RCM?

At BlueFish Medical, we believe informed customers are happy customers. We pride ourselves on building true partnerships with our clients, with a committed domestic labor force, specialty-specific expertise, and a philosophy of transparency and training that will strengthen our client practices for the long term.

Moreover, we provide our revenue cycle management clients with a performance guarantee. We are committed to keeping rejected, denied and appealed claims to a minimum, and we stand behind that commitment by offering a credit on your next monthly bill if we exceed a mutually agreed upon number of claims or a maximum age for each status.

If you’d like to learn more about our performance guarantee and how BlueFish Medical RCM services can help strengthen your practice’s financials, fill out the form below.

    Sources:

    What Is the Business Case for Outsourcing Revenue Cycle Management? 2016. Healthcare Financial Management Association.

    Your Revenue Cycle: Days in Accounts Receivable. 2018. American Academy of Family Physicians.