RCM has become one of the most popular functions to outsource, do you know why?

A revenue management system is one of the most problematic functions that hospitals have to combat nowadays. The main issue is with regards to being able to break even. There are many hospitals that are facing the red line when it comes to their balance sheets. Many are just surviving while there are a few who are managing to garner profits. These profits make it possible to expand and invest in newer ideas and concepts.

The main concern of the hospital’s administration is to make sure that the doctors and the nursing staff practice their jobs and are able to provide the right kind of services to the patients. RCM outsourcing allows proper reimbursements levels and at the same time ensures that the hospital remains profitable.

There are many reasons why hospitals have started to outsource their RCM to other companies; the major and most known benefit is due to better profits. The  benefits are:

1. It helps to increase revenue. When the hospital is managing the funds, there are a lot of chances that the hospital might not be able to find the person who has submitted the insurance, and the approval of the documents tend to take a very long time so in turn the hospital has no option but to write it off as bad debt. This leaves the hospital at a loss. When the hospital administration outsources the revenue collection then there is proper record keeping, and this allows confirmed funds collection, and there is no loss to the hospital in any way shape or form. When a function is outsourced, the administration incurs a lesser cost, and there is also very little mismanagement and or wastage of time.
2. When the revenue collection is being managed by experts, there is increased efficiency in the system, and this allows for proper disbursement of funding and allocation is also much more efficient. The increased efficiency also allows for more effectiveness of strategies.
3. The main problem when the hospital is managing the revenue management themselves is that the doctors and the nurses have to step up to the administrative roles and this interferes with their roles as doctors and nurses. This also disrupts the normal routine functions of the hospital. When the hospital management outsources their revenue management system to other companies the doctors and nurses have the freedom to work and perform their jobs without any hindrance. This allows them to put their concentration and focus on where it should be the patient services.
4. When the revenue cycle management is outsourced, the hospitals have access to better technologies and advanced systems which otherwise would be a difficult task to maintain, especially if the hospital is managing the revenue cycle management themselves.
5. The hospitals do not have to worry about proper fund collection as the reimbursement settlements are efficient. The claims and the returns are all properly maintained and returned as per the requirements of the customers.
6. The financial performance of the hospitals are streamlined with much-improved patient care.