Assignment 5 Revenue Cycle Writing Center
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University of Maryland, University College *
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Health Science
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Dec 6, 2023
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Assignment 5: Revenue Cycle
Instructions
You have recently been hired at UMGC Health as a financial consultant. One of your job duties
entails educating new hires on the revenue cycle process.
For this assignment, you will prepare a 3-5 page white paper outlining the basic steps of the
revenue cycle.
Identify the various steps within the revenue cycle process, including admissions, case
management, documentation, coding, billing, et cetera.
For each step identified, provide details pertaining to the following:
o
Purpose of the step identified.
o
The individuals involved in the process (e.g., providers, transcriptionists, coders,
registration clerk, etc.).
o
The key components of the function, such as verifying insurance, financial
counseling, coding of documented services provided etc.
o
The consequences of failure to properly conduct the function identified.
Please Note: Support your research with at least five peer-reviewed sources. The use of
professional charts / graphs to reinforce written content is expected.
Due Date
Nov 21, 2023 11:59 PM
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Health care Revenue Cycle Process
University of Maryland Global Campus
HCAD 640: Financial Management for Healthcare Organizations
November 21, 2023
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What is Healthcare Revenue Cycle
In the intricate landscape of healthcare, where patient care intersects with financial
intricacies, the healthcare revenue cycle stands as a crucial mechanism that ensures the financial
health of healthcare providers. The healthcare revenue cycle is a series of interconnected steps
and processes that healthcare organizations follow to capture, manage, and collect revenue for
the services they provide to patients, “it is a health care organization’s financial circulatory
system” (Mcaskill, 2014). The revenue cycle is a comprehensive process that begins the moment
a patient seeks medical attention and extends until the provider receives complete compensation
for services rendered. In an era of transformative changes in both healthcare delivery and
financing, a nuanced understanding of the healthcare revenue cycle becomes paramount for
healthcare professionals, administrators, and policymakers alike. The primary goal of the
healthcare revenue cycle is to ensure that healthcare providers receive accurate and timely
reimbursement for the services they deliver while providing a positive experience for patients.
Revenue Cycle Process and Key Components
Identifying and understanding the steps in the healthcare revenue cycle is crucial for several
reasons, as it serves various purposes in the efficient functioning of healthcare organizations. The
healthcare revenue cycle encompasses the entire process from patient registration to the final
payment for services. The healthcare revenue cycle is “broken down into four activity categories,
depending on when they occur: (1)
before-service
activities, (2)
at-service
activities, (3)
after-
service
activities, and (4)
continuous
activities.” (Reiter & Song, 2021, p.660). In the four
activity phases, a diverse group of individuals contributes to the process, playing pivotal roles in
ensuring the seamless operation of revenue cycle management. Those engaged in the healthcare
revenue cycle process include:
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Scheduling, preregistration
Registration verification
Financial counseling
Charge capture
Documentation coding
Bed control
Billing
Payment posting
Account follow-up
A/R management
Contracting
Medical records/Health
information management
Case management
Utilization review
IT
Clinical areas (e.g., lab, ED, outpatient surgery) (Process mapping the revenue cycle,
2006)
As illustrated in the images above, the process commences when the patient schedules an
appointment, typically facilitated by scheduling and pre-registration personnel. Subsequently, the
insurance verification step is undertaken by an insurance specialist, followed promptly by the
completion of all subsequent stages. Insurance verification confirms a patient's coverage, the
medical billing and coding staff undertake subsequent steps, including coding, charge capture,
and claims submission, to ensure accurate representation of the provided services. Proper
documentation and coding are critical for billing accuracy, preventing undercoding or overcoding
that can lead to claim denials or revenue loss. The revenue cycle in provider organizations should
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guarantee accurate categorization of patients based on their payment obligations, ensure timely
and precise billing procedures, and facilitate the prompt receipt of correct payments (Reiter &
Song, 2021, p.601). Each step builds upon the previous ones in the healthcare revenue cycle
process.
Every stage plays a role in distinct facets of the process, collaborating to guarantee
precise billing, punctual reimbursement, and a favorable financial experience for both the
healthcare organization and patients. Effective communication and collaboration among these
stakeholders are crucial for maximizing the efficiency of the revenue cycle. Even having
collaboration with health plans are important, “a healthcare organization cannot expect to
achieve exemplary revenue cycle performance without effective collaboration with health plans.”
(Hegwer, 2017). You need to build strong relationships with health plans, so you can enhance
communication, streamline processes, and improve overall financial performance. Physicians
should also be collaborative in the revenue process; lack of physician engagement is what also
causes problems in the revenue process. “When physicians are fully engaged in revenue cycle
management, it becomes clear that the process is of utmost importance to the success of the
practice and that the entire team needs to be on board” (Reiter & Song, 2021, p.640). Physician
engagement in the revenue process is essential for achieving a harmonious balance between
clinical excellence and financial viability within healthcare organizations. It also supports the
overarching goal of delivering high-quality, patient-centered care in a financially sustainable
manner.
Consequences
Failure to follow all the steps in the healthcare revenue cycle process can lead to various
consequences, which will impact both the financial health of the healthcare organization and the
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overall patient experience. According to Manley and Satiani, it is important to not only complete
each step and obtain the required information, but also to review the previous steps to assure that
the information collected is accurate and complete (2021). Therefore, it is important for staff
members that are involved in the revenue cycle process to be properly trained in the policies,
procedures, and workflow. Having adequate and effective staff training will pay off in the long
run. When you have staff that are knowledgeable and know the functions of their roles, they can
perform their duties more efficiently. “Problems in the revenue cycle lead to lost and late
payments, both of which degrade provider revenues and hence financial condition” (Reiter &
Song, 2021, p.603). An example of this is if you do not get preauthorization for a procedure, a
claim can be denied. When a claim is denied, there will be either a delay in payment or worse, no
payment at all. All individuals play a crucial and interdependent part in ensuring the overall
financial health and success of the organization. One role is not less important than the other. The
strength of the healthcare revenue system lies in the synergy of its parts. Each role, whether at
the front-end or back-end, contributes uniquely to the overall success of the organization.
Recognizing the importance of every role fosters a culture of collaboration, accountability, and
shared responsibility, leading to a more resilient and efficient healthcare revenue system.
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Conclusion
As we reflect on the essential contributions made by diverse stakeholders, ranging from
front-end personnel guaranteeing precise patient information to back-end specialists intricately
managing coding and billing processes for services provided, the importance of each stage
becomes apparent. The revenue cycle, far from being solely a financial mechanism, emerges as a
strategic imperative entwined with the realms of quality patient care, regulatory compliance, and
the overarching sustainability of healthcare institutions. Identifying healthcare revenue cycle
steps is fundamental to achieving financial stability, optimizing operational efficiency, and
ensuring a positive experience for both healthcare providers and patients. It supports strategic
decision-making, compliance, and continuous improvement efforts within healthcare
organizations. Not only should adopting effective collaboration among all individuals involved
crucial but with health plans as well. Doing so helps healthcare organizations enhance the
efficiency of the revenue process, reduce denials, improve cash flow, and ultimately provide
better care to patients. Having open communication and a commitment to shared goals are key to
building and maintaining successful collaborations and making sure revenue cycle can without
setbacks. Ensuring every individual is trained and following every step completely and
accurately, understanding the components of the revenue cycle process can help providers break
down their processes, and examine any weaknesses in the financial management chain. By doing
so, can help improve efficiency, and ensure that the healthcare organizations are collecting
maximum amount of revenue for the services they deliver to their patients.
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References
Bhagavath, B., Goodman, L., & Petrozza, J. (2021). Billing, coding, and practice management: A
primer for today’s reproductive medicine professional.
Fertility and Sterility
,
115
(1), 22–
28. https://doi-org.ezproxy.umgc.edu/10.1016/j.fertnstert.2020.11.023
Hegwer, L. R. (2017). Award-Winning healthcare providers offer insights for improved revenue
cycle performance.
Hfm (Healthcare Financial Management)
,
71
(9), 1–6.
Kristin L. Reiter, & Paula H. Song. (2021).
Gapenski’s Healthcare Finance: An Introduction to
Accounting and Financial Management, Seventh Edition: Vol. Seventh edition
.
AUPHA/HAP Book.
Manley, R., & Satiani, B. (2009, September 26).
Revenue cycle management
. Journal of Vascular
Surgery. https://www.sciencedirect.com/science/article/pii/S0741521409014736
Mcaskill, R. (2014, October 28).
Examining the basics of the healthcare revenue cycle
.
RevCycleIntelligence. https://revcycleintelligence.com/news/examining-the-basics-of-
the-health-care-revenue-cycle
Process mapping the revenue cycle. (2006, February 1).
Healthcare Financial
Management
,
60
(2).