Automated Healthcare Solutions: Where are You in Streamlining RCM Processes? 

While the American Medical Association delineates eight steps in the healthcare organization revenue cycle, other sources (typically vendors) pinpoint up to 13. No matter the number, each step has significant revenue-leakage vulnerabilities that healthcare organizations must address to remain viable and/or attract investment. 

Automation can now access provider data and reveal weaknesses in each individual RCM system, delivering results and insights within minutes. Analyzing spreadsheets manually, via “brute force” (analysis and juxtaposition of multiple spreadsheets) not only takes RCM staff days to complete, but it also involves confusion and errors.

 The Council for Affordable Quality Healthcare Index (CAQH) recently asserted that the healthcare industry can save $18.3 billion by transitioning to fully electronic billing transactions. This cost savings opportunity comprises roughly five percent of the cost of administrative complexity in the U.S. healthcare system. 

By replacing manual file management and Excel spreadsheets with automated RCM systems, organizations can now precisely identify these revenue-depleting incidents:

• claim denial patterns and root causes
• revenue leakage points in the billing cycle
• coding inconsistencies and errors
• patient eligibility issues before service delivery
• bottlenecks in the revenue cycle workflow
• opportunities for process automation and optimization
• trends in payment delays and underpayments
• areas of non-compliance with payer requirements
• performance metrics for each stage of the revenue cycle
• potential fraud or abuse patterns in billing practices

Adjustments to workflow and staff understanding stop this leakage. Even a percent or two improvement shows the C-suite and investors that you’re on a positive track. 

Review how you can determine which points in your revenue cycle are most ripe for automation. Where can you replace staff members with software solutions? Which reports do you need to find your revenue vulnerabilities? 

In an environment where P&Ls are meticulously scrutinized, you can show your progress in revenue integrity improvement at that next RCM meeting. Advancing automated healthcare solutions is one of the ways revenue cycle staff can achieve the revenue lift CFOs and boards are looking for. 

What are automated healthcare solutions? 

Automated healthcare RCM solutions are advanced software systems that leverage technologies such as…

• artificial intelligence (AI)
• machine learning (ML)
• robotic process automation (RPA)
• natural language processing (NLP) 

… to streamline and optimize the revenue cycle management processes in healthcare organizations. These solutions automate repetitive, rule-based tasks across the entire revenue cycle, from patient registration and eligibility verification to claims processing, denial management, and payment posting. They integrate with existing electronic health record (EHR) systems and practice management software.

Automated healthcare RCM systems improve efficiency, reduce errors, accelerate cash flow, and enhance overall financial performance for healthcare providers. By automating time-consuming manual processes, healthcare organizations can reallocate staff to more complex, high-value tasks. Automated RCM solutions also provide real-time analytics and insights, enabling healthcare leaders to make data-driven decisions, identify revenue opportunities, and address potential issues proactively. As the healthcare industry evolves, automated solutions will become increasingly sophisticated, adapting to changing regulations and payer requirements. 

Determine where automation has the most potential to capture your revenue

Revenue cycle staff aiming to establish efficacy must make a case for RCM automation. It’s one of the most powerful paths to improved revenue and reduction in cost to collect. First, show the C-suite and other stakeholders where you’re leaking revenue. Follow it up with denials and underpayment recovery tactics that demonstrate you know how to retain and improve this revenue.

Start with the numbers and data that reflect where your organization struggles most. To determine, follow these steps: 

1. Prioritize based on potential ROI: Calculate the potential return on investment for automating different processes. Focus on areas that promise the highest ROI in terms of cost savings, increased revenue, or improved efficiency.
2. Conduct a comprehensive revenue cycle assessment or analysis of your entire revenue cycle, from patient scheduling to final payment. Identify bottlenecks, inefficiencies, and areas with high error rates or time-consuming, manual processes.
3. Analyze key performance indicators (KPIs) such as days in accounts receivable, clean claim rates, denial rates, and collection rates. Areas with poor performance are often prime candidates for automation. Take baseline measurements. Share these with the C-suite and establish your improvement goals. Yes, the next meeting will be tough: did you achieve those goals? How? Revenue cycle KPIs that most healthcare organizations rely on should be compared against MGMA and HFMA benchmarks. 
4. Evaluate staff time allocation:  Assess how staff members are spending their time. Processes that are repetitive, time-consuming, and rule-based are typically good candidates for automation. You may want to prioritize based on which revenue cycle points are the best candidates for automation. Look for processes that are performed frequently and follow consistent rules. These are often ideal for automation, as they can yield significant time and cost savings.
5. Assess error-prone processes:  Ask staff and managers where human errors in the revenue cycle most frequently occur. Make a list. Automation can help reduce these errors and improve overall accuracy.
6. Consider patient and provider pain points: Gather feedback from patients and physician pain points to identify areas where automation could improve satisfaction and efficiency. 
7. Analyze denial patterns:  Review claim denials to identify recurring issues. Processes contributing to frequent denials may benefit from automation to reduce errors and improve clean claim rates.
8. Evaluate technology infrastructure: Assess the current technology stack and identify gaps where automation could integrate seamlessly and provide the most value.
9. Maintain regulatory compliance: Identify areas where automation can help ensure compliance with healthcare regulations and reduce the risk of penalties.

By evaluating these factors, healthcare organizations can prioritize their automation efforts to focus on areas that will yield the greatest benefits. Improve revenue cycle management, enhance cash flow, and reduce administrative burdens. 

Your list of revenue-depleting RCM points: prioritize them correctly

Now you have your list of the most problematic or most promising revenue cycle points. Read how Radiology Associates, a large radiology physician group, identified $1.1 million in validated underpayments from just one payer or how an ophthalmology group with 5 clinics and ASCs recovered significant revenue and avoided the need to hire additional FTEs. 

By automating processes once carried out by staff, RCM solutions cut through the noise of files and Excel spreadsheets to pinpoint exactly where:

• revenue is leaking
• payers are shortchanging them
• patients need support in understanding and carrying out their financial responsibilities
• opportunities exist to improve EBITDA margins, net revenue, and cash flow

A MGMA survey revealed that more than 70% of healthcare executives put revenue cycle optimization efficiency (which translates as automation) as a top priority. With widespread RCM staffing shortages, healthcare systems are turning to automation. Innovative, automated RCM solutions are helping MSOs reduce labor expenses and boost cash flow by automating tasks previously performed by staff members.

Today, it takes streamlined operations to achieve financial stability and operational excellence. 

Automate these key RCM processes to capture revenue more effectively 

This section explores key areas where automation can significantly impact the revenue cycle, from patient registration to billing and collections. By leveraging advanced technologies such as artificial intelligence, machine learning, and robotic process automation, healthcare organizations can address critical pain points, enhance efficiency, and ultimately improve their bottom line. 

Review these sections to understand the automation opportunities across the revenue cycle, the potential time and cost savings, as well as improvements in accuracy and patient satisfaction.

• Patient registration and eligibility verification -  Automation for patient access requires software to capture patient information and verify real-time insurance eligibility. According to the CAQH Index report mentioned above, automating eligibility and benefit verification can save up to 16 minutes per transaction and $5.4 billion annually across the healthcare system. 

• Prior Authorization - Implementing automation for prior authorization can expedite the approval process and reduce delays in patient care. RPA tools can automatically submit requests, check status, and follow up with payers. A study by the American Medical Association found that 88% of physicians described the burden associated with prior authorization as high or extremely high, making this a prime area for automation.

• Charge Capture and Coding - Automated charge capture systems can ensure all services are accurately recorded and coded. AI-powered coding assistance can improve accuracy and speed. This process is crucial as errors in coding can lead to claim denials or underpayments. The American Academy of Professional Coders estimates that automated coding can improve productivity by 25-50%.

• Claims Submission and Processing  - Automating claims submission can significantly reduce errors and accelerate the revenue cycle. Healthcare organizations are adopting robotic process automation or machine learning to scrub claims for errors before submission. RPA also effectively tracks submission.  According to the CAQH Index mentioned above, electronic claim submission can save up to $1.1 billion annually for the healthcare industry.

• Denial Management -  Automated denial management systems can quickly identify the reasons for denials, prioritize them based on value, and even automate the appeals process for common denials. With these tools, you can improve the denial resolution rate and reduce the time to payment. A report by Change Healthcare found that about 9% of claims are initially denied, representing $262 billion in initially denied claims annually. 

• Payment Posting and Reconciliation - Automating payment posting can ensure faster and more accurate reconciliation of accounts. RPA can automatically match payments to claims and post them to the appropriate accounts. This process can significantly reduce the time and errors associated with manual posting.

• Patient Billing and Collections - Implementing automated patient billing systems can improve the patient's financial experience and increase collection rates. This includes automated payment reminders, online payment portals, and personalized payment plans. A survey by Black Book found that 83% of providers are planning to meet the growing patient demand for more retail-like healthcare experiences by offering digital payment options. 

By prioritizing these areas for automation, MSOs can significantly improve their revenue cycle efficiency, reduce errors, and accelerate cash flow. It's important to note that successful implementation requires careful planning, staff training, and ongoing monitoring to ensure optimal results.

Front-end RCM processes to automate first

Most likely, you already know which points in your revenue cycle system are most ripe for improvement. Square those with the following rationales for the prioritization of RCM tasks.

1. Online Patient Registration

Prioritize automating patient registration first when your goal is to

• reduce administrative burden and improve data accuracy. 
• minimize errors associated with manual data entry and save staff time. 
• enhance the patient experience by providing convenience and reducing wait times.
• Save staff time transactions so staff can focus on face-to-face tasks.

2. Insurance Eligibility Verification

 Target eligibility and benefits verification when your goal is to: 

•  prevent claim denials and improve cash flow. (Denials now are triggered in 12 to 14% of all provider claims.) According to CAQH, automating eligibility and benefit verification can save up to 12 minutes per transaction and $5.4 billion annually across the healthcare system. According to the CAQH Index, electronic eligibility and benefits verification saves staff 16 minutes per transaction. 
• address eligibility issues before services are rendered, reducing the risk of unpaid claims.
• minimize errors in patient eligibility verification by leveraging software insights into proper and complete claims submissions, leading to more reliable eligibility checks.

3. Streamline prior authorizations

When, as the CAQH Index reports, prior authorization issues prompt denials totaling a revenue loss of $5 billion annually across the healthcare industry, of course healthcare organizations must focus on the patient access process. If your prior authorization backlog is preventing your physicians from carrying out services, you need to research the companies that can automate this process. 

According to the 2023 CAQH Index, electronic prior authorization saves staff 11 minutes per transaction.  

4. Appointment scheduling and reminders

Fill your schedule to:

• improve patient attendance rates and reduce no-shows
• fill appointment slots and best utilize providers' time is utilized effectively 
• Use automated reminders to improve patient satisfaction and engagement

By prioritizing these front-end RCM automation tasks, healthcare providers can set a strong foundation for the entire revenue cycle, leading to improved financial outcomes, enhanced patient experience, and better overall operational efficiency. 

4. Charge Capture and Coding

 When physicians are not getting all services into the claim, organization revenue deteriorates. The American Academy of Professional Coders estimates that automated coding can improve productivity by 25-50%. Real-time charge capture and coding, accelerating the billing process, leading to faster claim submissions and, ultimately, quicker payments. Further, AI-assisted coding systems can quickly adapt to changes in coding guidelines, ensuring that providers stay up-to-date with the latest requirements without extensive retraining.

Use automated healthcare solutions in the midcycle (charge capture and coding) to:

• ensure all services are accurately recorded and coded
• improve coding accuracy and avoid claim denials or underpayments
• Stay consistent with regulatory compliance. AI-assisted coding can help ensure adherence to coding guidelines, reducing the risk of audits and penalties

Charge capture and coding directly affect a provider's ability to bill for services rendered. Accurate and complete charge capture ensures that all billable services are accounted for, while proper coding translates these services into the correct billable codes. Any errors or omissions in this process can lead to significant revenue loss. 

5. Back-end - claims processing and submission

Healthcare providers can determine whether they have significant issues with claims processing by carefully analyzing key performance indicators that reveal underlying problems in their revenue cycle. Indicators include:

•  A claim denial rate exceeding 5-10%. A low clean claim rate below 90-95% suggests systemic challenges in claims preparation. 
• Days in accounts receivable, often extending beyond 50 days, can indicate inefficiencies in the claims process. 
• First-pass resolution rate (the percentage of claims paid on initial submission) that reveals the depth of potential processing issues.

Automated claims scrubbing and electronic claims submission give healthcare providers a powerful solution to address these challenges. Automated claims scrubbing reduces errors, enabling organizations to identify and correct potential issues before claim submission. 

This technology can improve clean claim rates by up to 25%, dramatically reducing denial rates and saving significant staff time. The consistency and compliance benefits are equally important, as automated systems apply rules uniformly and can be updated to reflect the latest coding and billing requirements.

Electronic claims submission complements automated scrubbing by transforming the claims processing landscape. This technology accelerates the payment cycle by eliminating manual data entry errors and reducing processing time. Electronic submission offers multiple advantages, including:

• improved accuracy
• cost-effectiveness 
• enhanced tracking capabilities 

Many payers now prefer or require electronic submission, which can lead to faster processing and payment.  

By investing in automated claims scrubbing and electronic submission, healthcare providers can significantly improve their revenue cycle efficiency, reduce errors, accelerate cash flow, and ultimately enhance their financial performance. 

6. Denial & underpayment management

Automation and AI technologies are revolutionizing the denial and underpayment management process, making it more efficient and accurate.

Your organization should focus on denial and underpayment management when you know you need:

• real-time flagging of denials as they occur
• automatic categorization of denials by type (e.g., medical necessity, coding errors, eligibility issues)
• prioritization of denials based on dollar amount, age, or likelihood of successful appeal
• immediate routing of denials to the appropriate team for resolution

AI technologies are particularly effective in performing root cause analysis for denials, offering deeper insights than traditional methods. AI-driven root cause analysis can:

• analyze large volumes of historical denial data to identify recurring patterns and trends
• Uncover underpayments by finding payment variances between actual payments from payers and contracted rates. 
• correlate denial reasons with specific providers, procedures, or payers to pinpoint systemic issues
• use natural language processing to extract relevant information from denial letters and clinical documentation
• provide predictive analytics to forecast potential denials before they occur

Advanced analysis enables healthcare organizations to:

• implement targeted interventions to address the most common or costly denial reasons
• proactively adjust billing practices to prevent future denials
• continuously improve coding and documentation processes based on AI-generated insights
• develop data-driven strategies for payer negotiations and contract management

By combining automated denial identification with AI-driven root cause analysis, healthcare organizations can significantly reduce their denial rates, improve cash flow, and optimize their revenue cycle management processes.  

11 steps to simplify RCM healthcare solution automation integration

Ensure integration and maximize benefits with these 11 steps: 

1.  Assess Current Processes:

•    Conduct a thorough analysis of your existing revenue cycle processes.
•    Identify bottlenecks, inefficiencies, and areas with high error rates.
•    Determine which processes are most suitable for automation.

2. Define Clear Objectives:

•  Set specific goals for what you want to achieve with automation (e.g., reducing denial rates, improving clean claim rates, accelerating cash flow).
•  Establish measurable key performance indicators (KPIs) to track progress.

3. Choose the Right Technology:

•    Research and evaluate different RCM automation solutions.
•    Consider factors such as scalability, integration capabilities, and AI/ML features.
•    Select a solution that aligns with your organization's needs and goals.

4. Develop an Implementation Plan:

•    Create a detailed roadmap for implementing the automation solution.
•    Prioritize which processes to automate first based on potential impact and ease of implementation.
•    Set realistic timelines for each phase of the implementation.

5. Ensure Data Quality and Standardization:

•  Clean and standardize your data before implementation.
•  Establish data governance policies to maintain data integrity.

6. Integration with Existing Systems:

• Work closely with IT teams to ensure seamless integration with existing EHR, practice management, and billing systems.
• Conduct thorough testing to verify system compatibility and data flow.

7. Staff Training and Change Management:

•    Provide comprehensive training to staff on the new automation tools.
•    Address concerns and resistance to change through clear communication and education.
•    Emphasize the benefits of automation for both staff and the organization.

8. Phased Implementation:

•   Start with a pilot program or implement automation in phases.
•   Begin with less complex processes and gradually move to more complex ones.
•   Learn from each phase and make necessary adjustments before expanding.

9. Monitor and Optimize:

•  Continuously monitor the performance of automated processes.
•  Regularly review KPIs and make data-driven decisions for optimization.
•  Be prepared to make adjustments and refinements as needed.

10. Ensure Compliance and Security:

•   Verify that the automation solution complies with healthcare regulations (e.g., HIPAA).
•   Implement robust security measures to protect sensitive patient data.

11. Foster a Culture of Continuous Improvement:

•   Encourage staff to provide feedback on the automated processes.
•   Stay updated on new technologies and best practices in RCM automation.
•   Continuously look for new opportunities to expand automation across the revenue cycle.

By following these steps, healthcare organizations can effectively implement RCM automation solutions, leading to improved efficiency, reduced errors, and enhanced financial performance.  

Automated contract management for optimized revenue

Automation is at the center of the healthcare digital revolution. The Council for Affordable Quality Healthcare (CAQH) estimates that fully automating nine common revenue cycle management transactions could save the U.S. healthcare system $16.3 billion annually. Travel, entertainment, and retail were digitized a decade ago. Now it’s healthcare’s turn. 

MD Clarity’s RevFind offers robust automation features that enable management service organizations (MSOs) and physician groups to optimize their revenue streams. By consolidating all payer contracts into a single platform, RevFind allows providers to perform an in-depth analysis of payment data, comparing it against agreed-upon terms. The system automatically identifies any inconsistencies between received payments and expected reimbursements based on contractual agreements for all practices under management. Once these underpayments are detected, providers can promptly inform payers and initiate the process of recovering the revenue they're entitled to. By eliminating the need for manual payment reviews against contract terms, RevFind saves valuable time for MSO executives and enhances overall organizational efficiency.

Schedule a demo to see how RevFind can simplify and optimize your contract management and modeling processes.