Do You Know Your Revenue Cycle?

Revenue Cycle Management is the key word of the month in the private practice world, but does the physical therapy practice owner really know what it means?  I bet most owners know the term but don’t really know what it entails.  Revenue Cycle Management is the term used to define the process of revenue from start to finish so let’s take a quick look at each phase of the cycle.

The cycle starts with visits because visits are actually the driver of clinic revenue.  Getting the patient in the door, and keeping the patient in the clinic, is the key to any clinics success.  Getting the patient in the door requires a strong customer service presence at initial contact and keeping the patient in the door requires all staff members to show, and tell, the patient the value of care they are receiving.  One other aspect of the visit cycle is to ensure your claims for those visits are “clean” the first time.

On average, a minimum of 10% of all claims will be denied the first time filed. Ensuring demographic data is accurate, and complete, will help keep this number low.

The next phase of the cycle is charges for services performed.  Charges are not only based on the services you provide but also the payers your work with.  Do you have a full understanding of all your major insurance fee schedules?  Do you know what codes certain insurance companies do not reimburse for?  Do certain insurance companies require an authorization?  Knowing the answers to these questions is vital to this stage.  Knowing, understanding, and sharing who pays what and who doesn’t pay is an important aspect of this phase of the cycle.

The last phase of the cycle is accounts receivable or the collection of all those promised payments.  The easiest payment that is often missed is the co-pay from the patient.  All patients that have a responsibility to pay for any part of their treatment MUST be required to pay at time of service.  Can you go to an auto repair shop, have your oil changed, and pay next month?  Treating a patient is providing a service, a service where the patients responsibility is due the day service is provided.  Most of today’s insurance billing has become an electronic, automated, process.  We upload the billing, the claims are scrubbed and sent to the payer, then hopefully paid electronically back to us.

Do you have a system in place to monitor rejections and proper payments?  People, and computers, can make errors so knowing your fee schedule is important to ensure your payers are paying correctly!

To be successful, and profitable, the revenue cycle process must be in place and the correct metrics measured to ensure the processes are running smoothly.  When these processes are running, the patients are seen, billed for, collected on, and profit is made.  Are you having problems with part of this cycle? Click Here to schedule a FREE consultation to see how PTClinicMetrics can help!!

Andrew Vertson, PT, DPT, ATC
Latest posts by Andrew Vertson, PT, DPT, ATC (see all)

You Might Also Like...