Reducing Accounts Receivable (AR) Days With Revenue Cycle Management (RCM) Technology [How to Ensure Claims First Pass Resolution Rate of 90% Or More] – Part 1

It is obvious that healthcare providers administer the most important services one could receive. These professionals work tirelessly, conducting medical procedures with unwavering focus and attention to detail for the sake of the patient. In the same way, revenue cycle management (RCM) services, including the technology that supports the process, should facilitate payment, carefully but expeditiously. 

Reducing Accounts Receivable (AR) Days with RCM Technology

The gap between the request for payment to the receipt of payment is a crucial interval. That period should not linger on past the payer’s allotted expected turnaround time. An effectiverevenue cyclemanagement (RCM) system should leverage the most productive means of communicating with the payer to request and receive reimbursement. In the healthcare industry, electronic claim submission is the most efficient way to exchange data and reduce AR days. 

The Lower the AR Days, the More Efficient the Revenue Cycle

The lower the accounts receivable (AR) days, the more efficient the revenue cycle becomes, and overall business thrives. Electronic Claim Submission or Electronic Data Interchange (EDI) initiates a streamlined operation of reducing AR days. A medical claim acts as an invoice that lists out the particulars of a billable patient visit, explaining the who, what, where, when and how of the medical service(s) performed. When that information transmits electronically to the payer, the insurance or organization that decides how much of the balance due they will pay out to the provider, it speeds up the process. Electronic claim submission stands as the most efficient and HIPAA compliant way of managing healthcare transactions. 

Healthcare providers, and related businesses, should exchange claim data electronically not only for efficiency but to ensure secure transfer of sensitive patient health information. To safeguard protected health information (PHI), which includes patient and provider data, the U.S. government instituted the Health Insurance Portability and Accountability Act of 1996 (HIPAA). This federal law enabled a standard way of transmitting electronic transactions between healthcare businesses, HIPAA EDI X12N, designated by the healthcare subgroup, ASC X12N, of the Accredited Standard Committee X12 or ASC X12. 

Complying with HIPAA transactions and code set standards could present a challenging task for providers. If healthcare businesses do not submit claim information that aligns with EDI X12N transactions and medical coding standards the payer will reject or deny the claim. To mitigate the risk of claim errors, resulting in claim rejections and/or claim denials, providers should adopt revenue cycle management (RCM) technology. 

Reduce Errors With Revenue Cycle Management (RCM) Technology

Revenue Cycle Management (RCM) technology acts as a safeguard against claim and format errors in addition to PHI security issues. In other words, an effective RCM system will review and search for errors within claim data before transmitting the electronic claim file securely to the payer. Reliable RCM software comes equipped with various kinds of edits to flag missing or invalid claim information, based on HIPAA regulations. 

HIPAA claim edits ensure that claim data complies with EDI X12N 837P and 837I standards, professional and institutional claim standards. Payer Specific edits further “scrub” claims to ensure that the provider, patient, payer and medical coding information fulfill payer requirements. “Clean,” payer accepted claims, should result from this thorough review, facilitating lower AR days, and thus, revenue growth. 

Revenue Cycle Management companies, like Health Recon Connect, supply effective RCM technology and billing services to help providers fix “dirty” or denied claims. Among various kinds of EDI tools and resources, Health Recon’s RCM services include analytics to identify patterns in rejected or denied claim data and medical coding assistance to correct claim diagnosis and procedure code errors. The time it takes to correct those mistakes, however, increases, not lowers AR days. Thus, Health Recon Connect prepares providers on the frontend to meet payer requirements, submit “clean” claims and reduce AR days, click here to find out how.