Understand the 8 highest value tools and services to maintain healthy cash flow while delivering high-quality care.
Running a private behavioral health or allied health practice is tough.
Sure. On one level, you have the flexibility to deliver care on your own terms, in line with the best interests of your patients.
But as many therapists soon find out—dealing with the billing, insurance, and financial aspects of private practice (also known as revenue cycle management services or RCM)—can drastically reduce the autonomy and independence you initially felt when you started your business.
Fortunately, with the right RCM management services, you can regain your freedom as a therapist and achieve great outcomes for your clients.
Let’s take a look at how, beginning with an overview of what revenue cycle management is.
What Is RCM?
Revenue cycle management describes the entire financial process in behavioral healthcare, from the time a client contacts your practice to when you are paid for the care you provide.
While RCM can vary between private practices, it typically follows the sequence below:
- Patient Registration – Typically includes collecting demographic and insurance details from clients. Eligibility and pre-authorization checks are often conducted at this stage to confirm coverage for any treatment that will be provided.
- Service Provision and Billing – As care is delivered, providers need to carefully document and record the details of each service provided. This allows insurance claims to be submitted for reimbursement, and for clients to be billed for any costs not covered by their payer.
- Receiving and Following Up Payments – Submitting claims for reimbursement and invoices to patients is just the first step. You also need to track payments as they come in, so you can follow up on any denied claims or unpaid bills.
Why Is Revenue Cycle Management Important?
The obvious reason RCM is important is for the financial health of your business.
Put simply, without adequate cash flow coming in; you’ll have trouble keeping your doors open (even with a virtual practice).
You also won’t be able to grow your practice, whether that be through paying for marketing to attract new clients, diversifying your service offering, or taking on staff to expand your operations.
Effective RCM also has benefits for clients through improved access and quality of care.
When you do your due diligence with pre-authorizations and communicate with insurance companies, you ensure that patients don’t pay any more than they need to for treatment. This can increase the amount of treatment and therapy they have access to.
Learn more about behavioral health billing with our FREE Billing eBook!
How Can RCM Management Services Help My Private Practice?
The number one problem with revenue cycle management for behavioral and allied health practitioners is the complexity of insurance billing.
Understandably, to keep operating costs low, many providers start out trying to handle RCM by themselves. But they soon find they’re spending so much time on billing that it reduces their available clinical time. Furthermore, mistakes with claims and miscommunication with clients start resulting in large amounts of payments being delayed or not being received at all.
RCM management services allow you to focus on what you do best—delivering care to clients—while letting automated software and billing experts streamline the financial processes in your private practice.
8 Highest Value RCM Management Services
Depending on the size and nature of your private practice, you may choose to utilize one or several RCM management services.
To help you decide what’s going to give you the biggest return on investment (ROI), here are the eight highest value RCM management services. When used thoughtfully, these tools and services will almost always pay for themselves and deliver a positive result to the bottom line of your business.
1. Comprehensive EHR Software
The foundation of effective revenue cycle management has a fully-featured, fit-for-purpose electronic health record. Without this, many of the RCM management services we’ll discuss next simply aren’t possible.
For example, without good EHR software, you won’t be able to automate any of the insurance claims processes or utilize automated billing solutions. You’ll also have trouble analyzing any of your financial data to figure out what aspects of RCM are working well and which need some work.
To find out more, read our guide on how to choose the best behavioral health EMR for your needs.
2. Intelligent Scheduling Tools
Ensuring available slots for clinical appointments are filled is one of the simplest ways to maximize revenue.
RCM management services like intelligent self-service scheduling tools help clients and therapists minimize costly events like double booking, scheduling mix-ups, and missed appointments.
There are many digital tools available now that are so easy to use that all aspects of appointment scheduling (including appointment reminders and intake processes) can be completely automated.
3. Automated Insurance Verification
Getting a full picture of the treatment your patient’s insurance will and will not cover early on helps to develop clinically optimized, financially viable treatment plans.
If you’re using good EHR software, automated RCM services can take care of this entire process as part of your intake and assessment procedure by communicating electronically with the insurer. That way, in the first appointment, you and your client can discuss a plan for treatment that will work for both of you, with no financial surprises that might derail progress later on.
4. Integrated Claims Management
Inefficient insurance claims processes are one of the biggest drains on resources for behavioral and allied health practices.
Poor claims management processes can eat into available clinical time, increase the rate of claims rejections and denials, and lead to lengthy delays from when you submit a claim to getting paid for your services.
Integrated claims and RCM management services streamline the process of collecting the data required to submit a claim, then track when reimbursement is received. This leads to on-time payments by submitting “clean claims” (a claim with no errors) the first time around.
5. Intuitive Billing Software
There are no two ways about it—behavioral health billing is complicated.
You’ve got to get prior authorization from the payer, submit an accurate claim with the correct CPT codes for your patient’s diagnosis, then collect any co-pay from your client.
Intuitive billing software allows many of the insurance-related steps of this process to be automated and double-checked for quality control. Furthermore, it enables bills and payment reminders to be sent to clients, who then can pay via credit card through a convenient and secure patient portal.
6. Claims and Reimbursement Assistance
Depending on the size and nature of your private practice, it often makes financial sense to invest in specialist RCM management services for insurance claims and reimbursement. This particularly applies to larger practices, work with several different insurance companies, or have high rates of claim errors or denials.
The most common approach is to work with a medical billing clearinghouse, often just called a clearinghouse for short.
A clearinghouse is an intermediary between a healthcare practice and an insurance company. They check claims for errors, review billing codes, and ensure claims are submitted in a compatible format—all of which help to increase your rate of successful claims.
To learn more, read our article on how to choose the right clearinghouse.
7. Comprehensive Reporting Tools
You can’t fix revenue cycle problems in your private practice that you don’t understand. Or worse yet, they aren’t even aware of it.
Comprehensive reporting and analytics software is an RCM management tool that will help you track financial KPIs, undertake budget forecasting, and identify risks and opportunities in your business. It’s a must-have for any practice owner wanting to grow and be financially successful.
The best approach is to find an EHR product that offers integrated reporting and analytics, like Therapy Brands Practice Management Solutions. That way, you don’t have to extract and transfer data between systems—the software simply does it for you.
8. Denials and Collections Process
An unfortunate fact of running a private practice is that some insurance claims and patient invoices will go unpaid despite your best efforts.
To reduce the financial impact of this challenge, it helps to have RCM management services and processes in place to reduce the likelihood of these events happening, then deal with them swiftly when they do occur.
Many tools and services we’ve discussed can help reduce claim denials. So pick which aligns best with your needs and get them in place as soon as possible.
Regarding patients not meeting their financial obligations, being proactive about insurance verification and billing can reduce instances of non-payment. However, you’ll still need to be pre-prepared with a collections strategy to action when required.
Choose a Partner That Will Help You Succeed
Revenue cycle management is essential for anyone running a behavioral or allied health private practice.
Of course, your top concern is delivering high-quality care to your clients. But at the end of the day, if you don’t have the cash flow to keep your business running, you won’t be able to help anyone.
It rarely makes financial sense for clinical time to be used on administrative RCM duties. So to maximize the earning potential of you and your team—invest in high-quality RCM management services and tools like the ones we’ve discussed in this article.
RCM management services always work best as part of an integrated solution. This means choosing a partner who understands your needs and can help your private practice succeed is important.
At Therapy Brands, we have designed all of our products by therapists, for therapists. We understand what it takes to succeed in private practice and have a variety of customizable, all-in-one practice management software solutions for therapists just like you.
To learn more about RCM and billing, check out our FREE Billing eBook today!