Clinically Driven Revenue Cycle Management

What is a Clinically Drive Revenue Cycle?

A Clinically Driven Revenue Cycle is an approach to the management of the revenue cycle in healthcare; it incorporates clinical data in the processing of claims to help ensure healthcare organizations will be paid for the services they provide. Rather than a specific platform or system, it is a philosophical concept that requires alignment from doctors, nurses and other clinical staff with the financial side of the hospital, physician practice or healthcare organization. The emphasis is on providing quality care, delivering appropriate services, maintaining efficient workflows and ensuring timely reimbursement.

What are the Components of a Clinically Driven Revenue Cycle (CDRC)?

In many ways, a Clinically Driven Revenue Cycle is similar to a conventional approach to revenue cycle management. Each one considers the full revenue cycle process. Both incorporate claims processing, medical coding and other administrative duties. A Clinically Driven Revenue Cycle, however, puts clinical data and documentation at the forefront, emphasizing quality, evidence-based care; medical necessity; and health outcomes. It ensures the quality of the medical record so that all documentation is complete, and the payment is not held up due to omission or inaccuracies.   As it reduces unnecessary procedures, tests and other treatments, it also allows hospitals and healthcare organizations to provide cost-effective services, fostering trust and confidence among clinical staff and patients alike.

Components of the CDRC include the start of the claim (patient registration, insurance eligibility and patient appointment); claim submission (charge entry, medical coding and timely claim submission); analytics (payment posting, medical coding services, denial management and appeals); accounts receivable management (AR follow-up, patient collections and patient statements); and claims management (payment posting, medical coding services, denial management and appeals).

What are the Benefits of Using a CDRC Approach in RCM?

The Clinically Driven Revenue Cycle approach achieves positive outcomes through minimizing claim denials; improving clean claims rates; improving quality of care; increasing efficiency; increasing revenue; improving integration of systems and processes; supporting clinical documentation; and streamlining appointment requests.

Benefit 1.  Minimized Claim Denials

A Clinically Driven Revenue Cycle approach reduces the chances of claim denial in numerous ways. First and foremost, the concept is all about ensuring clinical documentation is an accurate representation of patient care, and that the treatment or procedure is medically necessary. Pre-authorizations bring clarity. Further, it ensures all details needed for billing and claims are included. The CDRC requires a collaborative approach between the clinical and financial sides of the business, helping each aspect learn from the other and assisting the organization as a whole discover and fix any breakdowns in the process that might lead to claim denials.

Benefit 2.  Improved Clean Claims Rates

In an ideal world, all claims would be quickly and easily processed and paid. For such timely payments, the claims must be “clean:” submitted without any errors or omissions and able to be processed without additional information or verification. It is possible for hospitals and healthcare organization to improve their clean claims rate, and a Clinically Driven Revenue Cycle approach helps make this possible. With greater accuracy in coding, fewer unnecessary visits, coordinated efforts and real-time documentation, the chances for a clean claim increase.

Benefit 3.  Improved Quality of Care

At its core, the Clinically Driven Revenue Cycle puts the emphasis on delivering quality care and appropriate services, and aligns all functions to do just that. By reducing medically unnecessary tests and procedures; encouraging complete, accurate and real-time documentation of clinical care; and coordinating systems, processes and workflows, the CDRC sets the groundwork for patients to receive the best possible treatment, each and every time. As documentation improves, so does the opportunity for better-informed, patient-centered decisions and greater health outcomes.

Benefit 4.  Increased Efficiency

Because the Clinically Driven Revenue Cycle approach improves the clean claims rate, it naturally reduces the amount of time spent gathering additional information and verification for denied claims. But that’s only one way the approach increases the efficiency of hospitals and healthcare organizations. It also streamlines the coordination of care, and enables automation. Errors are reduced; staff members become more aligned and engaged; access to data improves; and the emphasis on providing medically necessary, high-quality care bodes well for long-term success.

 Benefit 5. Increased Revenue

Greater efficiency means greater revenue. Clean claims mean greater rates of reimbursement. And automated processes mean simplicity, consistency and greater productivity for clinicians and staff. The Clinically Driven Revenue Cycle approach can help in all of these areas. In addition, the CDRC incorporates analytics, increasing opportunities for ongoing improvement in processes, workflows and other practices. Integration and collaboration throughout help reveal gaps and inefficiencies that can negatively impact revenue.

Benefit 6. Better Integration

With a Clinically Driven Revenue Cycle approach, there is no longer the opportunity for segmented work. The various aspects of a hospital, healthcare system or physician practice are all pulling toward the same objective. There’s a greater need for shared data, greater opportunity for automation, greater ability for aligned workflows, and greater tracking of key performance indicators. Naturally, this requires collaboration, shared vision and integration across systems and processes.

Benefit 7. Support for Clinical Documentation

Imagine real-time documentation from doctors, nurses and others, aligned across the entire team. The CDRC emphasizes accuracy and complete documentation as a way of delivering the best possible care, and does so by incorporating it right into the clinician workflow. The clinical documentation is completed in a way that aligns with coding and billing processes, leading to greater consistency, efficiency and coordination of care. Further, if clinicians recognize that it is their expertise driving care decisions rather than financial targets, they may well be more engaged when it comes to documentation of their services.

Benefit 8. Streamlined Appointment Requests

As the CDRC is based on optimizing care delivery, there’s an emphasis on reducing unnecessary tests, treatments and procedures. Appointments are made as part of a coordinated continuum of care, even across providers. There may be an eye toward integrating online scheduling and other conveniences for patients, ensuring that they receive the care that they need, when they need it – without tying up provider schedules with low-value, superfluous visits. The Clinically Driven Revenue Cycle approach also reduces readmissions due to improved care management, further opening up the calendar for necessary appointments.

3 Examples of the Importance of a Clinically Driven Revenue Cycle in Action

Example 1. Revenue Lost Amid Complexity of Health System

It’s not hard to imagine: A large and busy hospital or health system with a variety of specialties is experiencing declining revenue and profitability. Details are falling through the cracks. Further exploration uncovers that staff are operating in silos; patients are receiving unnecessary tests and procedures; claims are being denied; and clinicians aren’t keeping up with comprehensive documentation during patient visits. Further, there’s confusion among coders trying to decipher the incomplete documentation, and levels of frustration, burnout and overwhelm are increasing.

In this scenario, a Clinically Driven Revenue Cycle approach would streamline the documentation and coding processes, including integration of disparate systems. Better coordination of care would lead to fewer unnecessary tests and procedures, resulting in fewer denied claims, as well as greater patient satisfaction and a more positive, collaborative experience for clinicians and staff.

Example 2. Lack of Pre-Authorization, Insurance Verification and Upfront Payment Information Leads to Bad Debt for Hospital

Alignment of clinical and financial goals is key to profitability. A specialty hospital, however, has been experiencing bad debt due to vague and incorrect documentation, lack of pre-authorization and insurance verification for elective procedures, and underpayment. The coding simply doesn’t reflect the levels of complexity involved, and coders haven’t conferred with clinicians. The challenges are increased by the lack of payment information provided upfront by patients.

Here, a Clinically Driven Revenue Cycle would foster accurate coding that fully reflects complexities, and a system of pre-authorization and eligibility checks would streamline processes and reduce the number of denied claims. Further, coders would work in tandem with clinicians toward increased clarity and better documentation, and patients would be informed of estimated cost responsibility prior to receiving care.

Example 3. CPT Code Update Means Improper Charges, Loss of Revenue

Each year, updates to the Current Procedural Terminology (CPT) code introduce the opportunity for errors and inaccuracies. Imagine a scenario, then, in which a code set is updated, but a rural hospital lags in making appropriate updates. The continued use of outdated, invalid codes leads to claims being rejected.

A Clinically Driven Revenue Cycle approach, however, would help ensure consistency, accuracy and accountability throughout the hospital. Coders and physicians would work more closely, with clinicians kept up to date on changes. Documentation would reflect these code changes, helping ensure accurate claim submission with valid codes. Claim denials would decrease, as would the amount of time wasted on resubmissions.

How does JTS Health Partners help you transform your Health Organization to a Clinically Driven Revenue Cycle?

As an established healthcare management consulting firm, JTS Health Partners combines leading services and solutions with creative, experienced advisors. Leaning on our expertise in billing, coding, accounts receivable management, patient access and other areas, we’re able to deliver individualized strategies for healthcare organizations, hospitals, physician practices and others. We help guide our clients toward greater efficiency and profitability.

Our Revenue Cycle Management solutions include consulting; operational support ; pre-bill review and auditing; and nCREAS™ analytics as a service (AaaS), powerful, predictive tools that dissect client data to offer insights for coding and revenue capture opportunities, denials improvements, AR trending and productivity metrics.  These solutions provide our clients a holistic opportunity to focus on doing what they do best: delivering the best possible care and improving health outcomes.

Ready to Transform Your Practice with a Clinically Driven Revenue Cycle?

Ready to begin the journey toward a Clinically Driven Revenue Cycle approach? JTS Health Partners can help you gain greater consistency, accuracy, clarity and profitability. Explore our Revenue Cycle Management services or schedule a consultation.