The US healthcare sector is constrained like never before with cost pressures, uncertain demand and inconsistent supply of skilled staff. Increasingly strict payer policies combined with a tough regulatory stance makes the whole business of reimbursements quite complicated.
The problem is not unsolvable in today’s scenario, but it demands a decisive approach. Hospital CFOs who prefer in-house management of their revenue cycle must expect to invest significantly more in staff training as well as technology to ensure they keep pace. Smaller practices and individual physicians may get caught up between the lack of staff to effectively manage their revenue cycle and the prospect of reduced reimbursement that could wreak havoc on their financial stability.
Predictably, the revenue cycle management market is poised for unprecedented growth in this decade. Grandview research estimates that the industry will grow at a 10.3% CAGR and cross the $300 billion mark by 2030. Fortune Business Insights has a higher expectation of growth, and pegs the CAGR at 11.4% over a similar period.
Streamlining the revenue cycle and enhancing financial performance are key strategic priorities, because it is crucial for healthcare providers to focus on patient care without distractions like paperwork and cash flow management. Here are some advantages offered by specialized medical billing companies that clearly makes them more viable than a typical provider’s in-house operation.
- Scalability and flexibility
When medical practices grow, expand or face unforeseen demand fluctuations, it is crucial that the entire organization adapts to the new scenario. This includes staff, equipment, software assets, office space and other resources. These can turn out to be expensive investments and must be maintained, ramped up or offloaded based on the changing requirements. Medical billing outsouring companies have the ability to be more nimble in the context, compared to a healthcare provider organization. A simple explanation is that resource planning for servicing multiple clients is more cost-effective, and allows for more flexible management, than in the case of a standalone in-house team. The economy of scale and broader availability of resources as well as alternative avenues for deployment of excessive resources are clear advantages in scalability. - Specialist knowledge and expertise
Healthcare providers are in the business of delivering quality healthcare to their patients, and their organizations must be optimized towards this goal. Maintaining a fully trained and constantly updated team of revenue cycle experts, managing the advancing technology and keeping up with payer-specific requirements requires constant focus. Medical billing companies are equipped with specialized expertise in handling the complexities of revenue cycle, and can help ensure accurate coding, timely claim submission, and optimal reimbursement, thereby reducing the risk of billing errors and claim denials. - Cost efficient operations
Cost is a rational and measurable metric that proves the value of outsourcing the provider revenue cycle. Through eliminating the need for in-house billing staff, training expenses, technology investment and other overheads, and replacing them with an outcome-based or volume-based fee, providers can control costs and gain the ability to allocate resources where the core business really needs them. - Optimization of the revenue cycle
Entrusting control of the revenue cycle with a specialized billing company allows for a step-by-step optimization of the entire value chain. Medical billing companies work with multiple clients, earning broad visibility over industry best practices, payer policies and other regulatory specifications that may evolve over time. An outsourcing strategy enables healthcare providers to overcome the tunnel vision which may be restricting their operational planning. By optimizing collection, and minimizing revenue leakage, the practice gains financial stability. - Regulatory compliance and risk
Evolving healthcare regulations, coding standards and billing guidelines put a lot of pressure on healthcare providers unless active approaches are implemented to optimize for these variables. Medical billing companies prioritize such compliance as it is central to their business model. By investing in ongoing training and technology platforms, medical billing companies can support their clients in compliance with standards such as HIPAA, ICD-10, and CMS billing guidelines. Healthcare providers can address compliance risks and avoid costly penalties associated with non-compliance through an effective outsourcing strategy.
In general, it is evident that a specialized medical billing company will have access to the skills, capabilities and technology that can improve financial outcomes, efficiency, and revenue cycle performance for their healthcare provider clients. This includes electronic claims submission, process automation and intelligent analytics tools that can empower the client with sophisticated analytics and reporting capabilities. By choosing a suitable outsourcing solution, healthcare providers such as hospitals, physicians and practice groups can gain immense value and steer clear of the risk associated with upfront financial investment. By offloading the burdens of administrative and documentation related tasks, healthcare professionals can focus on their job of serving their patients and delivering the care they seek.
