Healthcare technology is in the transition from the fee-for-service model (where providers are paid for every specific service rendered) to the new Value-Based Healthcare model (where providers get paid based on the quality of patient care). In the new world of value-based care, the providers have to take on accountability for an entire episode of care and where reimbursement is based on meeting high-quality measures and shared-risk of costs with patients.
RCM transforms to Value-Based Healthcare
Revenue cycle management (RCM) ensures providers with fair and full reimbursement for the care they provide to patients. The fee-for-service system is a straightforward process where medical encounters are properly documented in the electronic health record (EHR), submit claims, and follow through to payment. Now, with Value-Based Healthcare model reimbursement is dependent on quality and cost performance. The shift to value-based care requires providers to revisit their existing RCM approaches and evolve them in four primary areas:
RCM should be optimized based on value, not just volume
Provider’s financial performance was once primarily dependent on a few top-line medical encounters such as the number of patients, and the type of services rendered. This, in turn, slowly led to the up-front accuracy of claims, and efficiency of the provider, wherein care quality was given secondary preference.
In contrast, value-based healthcare programs (including MIPS and APMs) identify quality, cost, and other output measures upon which reimbursement depends. Here are a few optimizations that help value-based healthcare reimbursement.
- Enable the accurate inputs for calculations and ensure complete and timely submissions
- Payers group benchmarks when considering the performance
- Identify those measures for which the practice is likely to over- or under-perform and creating financial scenarios based on likely outcomes
- Address the areas of under performance and find the root cause of negative outliers and drive continuous quality improvement.
RCM becomes a shared responsibility
RCM management used to be a back-office function, whereas now, the providers that will thrive under Value-based healthcare will be those whose lead practice administrators are very much on the front lines alongside their clinical counterparts because they have to look together at how they’re performing against various measures. Optimizing RCM for value-based care requires a very different mindset, a different set of work culture and skills, and different supporting technology to be able to track what’s going on when patients walk out the door.
RCM should seek new analytics
Since reimbursement under value-based care is based on quality measures that practices must meet and shared-risk of costs with patients, it will become necessary for practices to acquire new technology solutions that can do the same things that payers do, to confidently assume the risk. For some practices, this might mean investing in a newer, more up-to-date EHR software designed with value-based care in mind, or at the very least to find technology that plugs-in to an existing EHR to bring it up to speed.
RCM should minimize the risks, not just denials
As value-based contracts grow, providers will anticipate and model the new risk factors that could negatively influence future practice revenue. Fee-for-service revenue cycles focused on the encounters between providers and patients that occurred between a practice’s four walls. But, value-based care models involve accountability for total episode costs, which can be driven by patient visits to other settings, providers, and treatments. If the provider minimizes the risks, denials would automatically would not have a scope.
Related Article: Patient Access: The Foundation of Revenue Cycle Enhancement Process
Value-based care is driving the transformation of many established operations within medical groups—and the revenue cycle is no different. The tendency for some to treat RCM as a back-office function will give way to a new collaboration with clinical partners at the forefront of the practice, modeling, tracking, and designing responses to the scenarios upon which overall financial health will depend. Therefore providers need to give more weightage to measure the situation and consider outsourcing revenue cycle management to reduce spending and focus on value-based care initiatives. Selecting an outsourcing partner with the latest technology, accurate skill, and experience, binds with your specific practice and strong ongoing support will help ensure a successful implementation.
If you are considering outsourcing your revenue cycle management and accounts receivable tasks, and are likely wondering where to start? Don’t worry – you are in the right place.
iPatientCare, is a leading provider in transforming RCM services with FREE Cloud-based Meaningful Use Stage-3 certified EHR and PMS technology. It provides efficient, responsive, and accountable billing implementation and back-office services that give more than 98% first-pass claims submission and efficient AR follow-up, denial management at very competitive rates. To learn more visit iPatientCare’s Healthcare Revenue Cycle Management.