Reimbursement and the Revenue Cycle
Reimbursement Definition
The identified medical organization for this analysis is Maximum Care Hospital (MCH). Medical professionals at MCH perform a wide range of tests, provide personalized care, offer drugs, and avail adequate resources to support the healing process. The process of receiving payments for such health-related procedures is called reimbursement (Barwise et al., 2020). Such financial resources are available to diagnostic facilities, practitioners, and healthcare providers. Key stakeholders required to perform such payments include insurance companies, employers, and government agencies (Tawde, 2021). The process of reimbursement remains crucial in the delivery of personalized medical services.
Several challenges would emerge should MCH fail to receive financial payments for the medical services it provides. First, the institution would become obsolete since it would be unable to meet its recurrent expenditure. Second, more practitioners and physicians will be compelled to seek job opportunities elsewhere, thereby making it impossible for patients to receive the much-needed medical services. Third, some patients will encounter numerous challenges trying to pay for their health expenses (Buchmueller & Levy, 2020). Finally, the complexity of these challenges would disorient the level of healthcare research.
Flow of the Patient: Revenue Cycle
The revenue cycle has become formalized to delineate the procedures hospitals need to pursue from the time a patient enters the facility until payments are received. Step one, preregistration, is the most important if the process is to deliver positive results. In most cases, the health records department is involved, whereby accountants capture key information, including eligibility, insurance details, and personal demographics (Cattel & Eijkenaar, 2020). Stage two, registration, is undertaken to capture accurate personal details, such as guarantors, insurance information, personal contacts and address, and next of kin.
Step three, charge capture, entails the process of billing depending on the services and resources provided to the patient (see Fig. 1). The finance and billing department liaises with the electronic health records (EHR) department to ensure that all activities and supplies are captured accurately. This process remains critical to ensure that the percentage of missing charges remain as low as possible (Buchmueller & Levy, 2020). Different departments and units are linked using electronic systems to share information with the finance and billing experts based on the performed tests and services.
The fourth phase of the revenue cycle, claim submission, entails sending the relevant patient information to the respective employers or insurance companies. MCH has a revenue team working within the billing department to crosscheck charges based on the codes for various medical procedures, laboratory tests, and diagnoses. These workers will communicate with the departments to confirm whether the patients will receive specific procedures (Gadbois et al., 2021). The professionals in the investigated hospital take the concept of claim scrubbing seriously to reduce grievances in the final reports. Stage five, remittance processing, allows the provider to liaise with the payer to identify the necessary allowable.
The sixth stage, insurance follow-up, the professionals in the facility scrutinize the available records to identify what has not been paid and the funds already remitted. This phase makes it possible for the financial experts to monitor whether claims are resubmitted or appealed. Consultants are usually engaged to provide the necessary recommendations whenever challenges emerge (Barwise et al., 2020). During the final stage, patient collections, workers ensure that billings and statement submissions are completed within the shortest time possible (see Fig. 1). This approach allows MCH to reduce the current level of backlog while ensuring that the billing department receive payments before most of the patients leave the hospital.
Departmental Impact on Reimbursement
Departments and Data Collection
Departments in medical institutions rely on reimbursement data to make meaningful decisions and improvements in care delivery. Failure to monitor this kind of information could affect health organizations in various ways. For instance, MCH will customize the revenue collection cycle based on the possibilities and financial plans of members of the served population. This challenge is associated with poor quality of healthcare since the institutions will miss out in the promoted pay-for-performance contracts (Blumenthal et al., 2020). Chances of transitioning to sustainable and value-based medical care would eventually reduce significantly.
The American Centers for Medicare and Medicaid Services (CMS) requires medical organizations to pursue various initiatives, including collecting data. This mandatory practice for pay-for-performance allows health leaders to find and identify practical solutions to the recorded medical problems. The professionals will rely on the presented data to make timely improvements to transform the quality of medical services (Blumenthal et al., 2020). These incentives could explain why pay-for-performance provisions are necessary for improving the effectiveness of the health sector.
Departmental Activities
At MCH, several departments exist that work synergistically to ensure that reimbursement is successful. For instance, the EHR unit is tasked with capturing patients’ information and ensuring that it is available to the other departments. Any missed information could affect the reimbursement process negatively since some individuals might receive unaccounted services. The units involved in medical procedures and care delivery need to consider the performed services and enter the relevant details, costs, and codes into the patient financial management system. Should the involved professionals miss specific details, chances are high that the reimbursement process could be disoriented (Blumenthal et al., 2020). The billing department interacts with reimbursements by crosschecking the entered information for every patient to identify and remove duplications.
MCH has a chargemaster database designed to outline specific items capable of producing financial charges. This system is the one tasked with ensuring that the recorded information is accurate and acceptable. The same department relies on the health information system portal to ensure that patients’ recorded are coded and reviewed effectively. Should the chargemaster take long to develop the needed chart for the patient, chances would be high that reimbursements will be delayed. With this kind of information, it becomes necessary for the involved personnel to rely on the chargemaster to audit final patient charts and determine whether changes are needed or not.
Responsible Department
MCH’s finance and billing department has an administrator whose role is to ensure that the reimbursement process is in accordance with the outlined regulations and policies. This leader delegates duties to a team that examines all cases and patient charts. Such an approach remains critical to ensure that the facility follows the relevant policies. The responsibility of this office affects the department’s impact on reimbursement in two ways (Gadbois et al., 2021). The first one is ensuring that the process takes a little longer than it would be expected. The second impact is that it guarantees a seamless process that ensures that reimbursements are completed promptly.
Billing and Reimbursement
Third-Party Policies
In the development of billing guidelines for different administration and personnel involved patient financial services (PFS), it becomes necessary to consider the available third-party policies. Involved professionals would need to consider some of the established legal requirements and merge them with the guidelines of different third-party payers. These workers should focus on eligible payers, offered services, and total possible reimbursements. This information would result in the formulation of the best patient charts that would be shared with the payers (Gadbois et al., 2021). The consideration would maximize the process of processing and subsequent reimbursements. Failure to follow third-party policies could result in delays and rejection of some of the claims, thereby minimizing the payer mix reimbursement.
The idea of a third-party payer has significant impacts on the payer mix for maximum reimbursement. Specifically, the agency will outline unique conditions and requirements intended to minimize expenses on their side. In some cases, patients might chose to ignore the transactions taking place between the payer and the provider (Tawde, 2021). The established policies could discourage patients from selecting favorable and cost-saving options. With each payer having its unique policies, the hospital might be unable to achieve the anticipated reimbursement targets.
Key Areas of Review
Hospitals need to consider appropriate strategies that can ensure that reimbursements from different payers are maximized and done in a timely manner. To achieve such an aim, involved facilities need to review and pursue various key areas. These include patient access, acceptance of accurate information, use of eligibility tools, maximizing patient involvement, examine propensity to pay, collect in advance, and effective triage efforts for finances (Tawde, 2021). These areas of review have been presented and organized in order of importance.
In terms of rationale, it is usually acceptable that proper reimbursement needs to be pursued in accordance with the revenue cycle. This approach means that MCH will succeed if it identifies and accesses the right number of eligible patients. Once this is done, the institution will ensure that more individuals with accurate information are accepted for medical services. The use of eligibility tools becomes necessary to support the process (Gadbois et al., 2021). The key departments should provide avenues for maximizing patient involvement to expedite the process. The concepts of prompt collections and financial triage systems support the delivery of the intended goals.
Follow-Up Team
Follow-up staff members play a significant role in the reimbursement process. The best strategy in the formulation of such a team entails focusing on the issue of specialization. The hospital needs to identify individuals with the relevant competencies in billing procedures. These skills would help them to audit the outlined third-party policies, codes for services and diagnoses, and adherence to rules (Tawde, 2021). Such a team will find it easier to complete their follow-ups and make it possible for payers to resolve denied billings and claims. To ensure that such a structure is effective, MCH can consider a detailed plan for continuous analysis, monitoring, and improvement. The auditing process could help identify and mitigate gaps to increase the benefits of proper reimbursement strategies.
Plan for Periodic Review
MCH can implement an effective plan for reviewing procedures periodically. This practice is essential since payers tend to revise their policies periodically. When done effectively, the relevant teams will liaise with payers and ensure that reimbursements are completed in a timely manner. The best plan for ensuring that there is compliance needs to have four stages. The first one would be to form a review team. The involved individuals should possess the relevant competencies if they are to deliver positive results (Tawde, 2021). The second stage is to analyze the existing guidelines revisions made, and align them with the hospital’s reimbursement cycle. The third phase is to apply such changes to ensure compliance (see Fig. 2). The final stage is to guide all key departments to embrace the transformation.
Since the outlined phases are explicit ad simple, the key stakeholders would be willing to be involved. Departmental heads would find the emerging procedures necessary since they will increase compliance. In terms of feasibility, the proposed plan has defined steps that are practical and easy to follow. It has the potential to deliver results since the current procedures present the required foundation for implementation (Tawde, 2021). The framework presents opportunities for engaging all stakeholders, thereby setting the stage for improving operations.
Marketing and Reimbursement
New Managed Care Contracts
The move to include managed care contracts is an approach that has results in the restructuring of reimbursement in hospitals. With this new arrangement, MCH has been receiving reimbursements based on the recorded health outcomes, sustainability, and quality of provided care (Gadbois et al., 2021). Scholars healthcare have shed more light on the power of managed care contracts and how they influence reimbursements. For example, Cattel and Eijkenaar (2020) reveal that such reforms guide physicians and doctors to make appropriate choices that can result in reduced costs for the patients while maximizing health outcomes. The consideration of such an approach at MCH is helping transform the quality of services available to more patients. The emergence of managed care organizations (MCOs) has led to a new approach to negotiation whereby the primary focus is to ensure that payers get good deals (Gadbois et al., 2021). With such observations from different researches and literature, it is evident that inappropriate choices and increased medical expenses could result in poor medical services, thereby resulting in reduced reimbursements from payers.
Required Resources
Hospitals have access to different resources intended to support their compliance to reimbursement requirements. The first one is called a coding compliance program (CCP). This initiative guides officers to monitor existing channels and examine written standards to maximize compliance. The second one includes the outlined codes of ethical standards in the field of healthcare. Such regulations provide regulations intended to dictate organizational activities and behavior (Tawde, 2021). They can be pursued to improve the overall level of compliance when it comes to billing and coding requirements. The third resource is the CMS which outlines key standards for ensuring that reimbursement requirements are met. The fourth source of details is the department of Health and Human Services of Inspector General (DHHSOIG). This office provides compliance requirements for stakeholders to consider when engaging in coding and billing processes.
Adherence to Ethical Standards
In the selected hospital, adequate measures are in place to ensure that the stakeholders involved in the process remain ethical. The first strategy entails the use of an ethical code of conduct. Such an essential framework combines all the procedures and undertakings relevant for employees in different departments. CMS has unique guidelines that form the second critical effort for compelling payers and medical institutions to adhere to acceptable ethical standards (Barwise et al., 2020). The hospital has a third mechanism intended to discipline individuals who engage in dishonesty. From these observations, it is notable that the strategies MCH and other stakeholders have put in place are adequate and capable of ensuring that all professionals involved in reimbursement remain ethical. Through the power of these mechanisms, MCH has been on the frontline to implement additional measures and opportunities to improve its overall adherence to established ethical guidelines throughout the processes of reimbursement.
References
Barwise, A. K., Wilson, M. E., Sharp, R. R., & DeMartino, E. S. (2020). Ethical considerations about clinician reimbursement for advance care planning. Mayo Clinic Proceedings, 95(4), 653-657. Web.
Blumenthal, D., Collins, S. R., & Fowler, E. J. (2020). The Affordable Care Act at 10 years—Its coverage and access provisions. New England Journal of Medicine, 382(10):963-969. Web.
Buchmueller, T. C., & Levy, H. G. (2020). The ACA’s impact on racial and ethnic disparities in health insurance coverage and access to care. Health Affairs, 39(3), 395-402. Web.
Carney, K. (2021). The seven steps of revenue cycle for a healthcare practice. Nashville Medical News. Web.
Cattel, D., & Eijkenaar, F. (2020). Value-based provider payment initiatives combining global payments with explicit quality incentives: A systematic review. Medical Care Research and Review, 77(6), 511-537. Web.
Gadbois, E. A., Gordon, S. H., Shield, R. R., Vivier, P. M., & Trivedi, A. N. (2021). Quality management strategies in Medicaid managed care: Perspectives from Medicaid, plans, and providers. Medical Care Research and Review, 78(1), 36-47. Web.
Tawde, V. A. (2021). The future of the revenue cycle management. IOSR Journal of Business Management, 23(2), 1-4. Web.