Outsourcing your medical office’s AR functions to a revenue cycle vendor is a big deal, requiring thoughtful consideration of multiple factors. Yet, some choose their revenue cycle vendor by comparing prices from various vendors and selecting the firm that charges the lowest rate – this can turn out to be a costly mistake.
Many practice managers don’t know that the price should not be the determining factor when choosing the right revenue cycle vendor. There are many other factors to consider. This article will give you helpful information about selecting the right vendor and getting the most bang for your buck.
Prices Do Not Tell All
Often, the main factor that medical practices consider is the price, but the truth is that prices do not tell all. When choosing a revenue cycle management (RCM) vendor, both price and value should be considered simultaneously.
As you consider vendors, you’ll come across different payment rates, usually a commission percentage you’ll pay from recovered funds.
Consider the following situation:
Vendor A charges 20% commission and collects $1,000. Your office nets $800.
Vendor B charges 30% commission and collects $2,000. Your office nets $1,400.
Though it may seem like Vendor B is more expensive (charging a 30% commission), your office ends up making $600 more with Vendor B than you would have with Vendor A. As you can see, the price (commission percentage) should not be the sole determining factor in revenue cycle vendor selection.
With that being understood, we must stress that overpriced vendors are out there. But if you consider a vendor’s worth in addition to their price, you’re much more likely to find the right vendor for your business.
While you cannot look into the future to see whether one vendor will collect more than another, several factors influence the success of RCM vendors.
Top Considerations When Choosing a Healthcare RCM Vendor
Choosing a healthcare RCM vendor is challenging, considering the sheer number of vendors out there. However, there are several factors that you should consider when evaluating multiple RCM vendors, including integrity, automation capabilities, and more. Let’s jump into all of them below.
RCM Experience & Ongoing Research
RCM firms with extensive hands-on experience performing revenue cycle management for medical practices are better positioned to provide good results for your company. It’s important to understand that RCM companies that don’t have industry-specific experience may not have the necessary expertise to perform satisfactorily.
It’s also helpful if the company is run by executives who have AR experience, specifically in the healthcare industry. Past experiences turn into nuggets of wisdom, which often lead to best practices and higher recovery rates.
In addition to practical experience, a promising RCM firm will consistently conduct industry research to improve its processes and procedures. A revenue cycle firm that stays abreast of industry changes and best practices is better positioned to outperform competing firms.
Integrity & Transparent Reporting
The risk of fraud is ever-present when working with a professional on financial matters. So, we recommend looking for a revenue cycle firm with a reputation of integrity – this is often verifiable through customer reviews and word-of-mouth references. If you can’t find any honest reviews or testimonials from an RCM’s past clients, there’s no way to know whether the firm will conduct business fairly and ethically.
Transparent reporting is another factor to consider when choosing an RCM vendor. Reports pertinent to the business engagement should be easy to access and available to review at your convenience. Look for companies that are proactive in reporting and eager to show clients how the AR recovery process is going.
Automation Capabilities
Automation takes a lot of the grunt work out of the collections process, drastically enhancing the efficiency of revenue cycle management. Therefore, firms that utilize automation to streamline their collections procedures offer more value to clients than those that do not.
While revenue cycle management can be performed without automation, firms can be much more productive through the use of automation tools. For this reason, your practice may be better off doing business with an RCM firm that leverages automation to maximize its yield.
Common Types of Automation in Healthcare RCM
Automation technology options expand by the day – vendors often use one of the following automation technologies:
- Automatic Dialers – Collection agencies often use auto-dialers to maximize their patient outreach capabilities. These dialers can multiply an RCM firm’s outreach efforts by more than 100%.
- Robotic Process Automation (RPA) – RPA automates rules-based processes pertaining to revenue cycle management. It is often used for insurance verification, claims follow-up, and even medical claim coding.
Privacy Standards
In the healthcare industry, lack of compliance with HIPAA privacy standards can be devastating to your medical office. Since RCM vendors deal with sensitive identifying information regularly, their staff must follow HIPAA guidelines at every turn. It is every medical office’s duty to protect their patient’s information to the best of their ability. This makes it extremely important to ensure that potential RCM vendors will uphold the same standards as the medical office when it comes to securing and protecting sensitive data.
When considering multiple revenue cycle management firms, ask each of them questions about how they safeguard patient information throughout the course of business.
Consider a Leading RCM Vendor
As you may be aware, there are no perfect RCM firms out there. But if you’re looking for a firm that provides enormous value for a reasonable price, consider DataSearch Inc.
DataSearch has been around for nearly 50 years, performing various RCM functions for medical offices and hospitals in the U.S. They have recovered more than $1B in billed claims for their clients due to their comprehensive recovery procedures and industry knowledge.
Above all, when choosing an RCM vendor, remember that the value of a vendor cannot be determined just by their price. Consider the other factors that we’ve covered above. We hope that this article is helpful to you in your search for a great RCM vendor.