Revenue Cycle Management In Health Care

Introduction

In this week paper I will be explaining several different things. First, I will be explaining what is meant by the revenue cycle and why is it important. Second, I will be explaining cost control and providing three examples. Lastly, I will explain what random audit contractor is.

What is Meant by the Revenue Cycle

What is Revenue Cycle Management? Revenue cycle management is the process of managing claims, payments and revenue generation. RCM plays a big role in everything from patient’s insurance eligibility and collecting co-pays to properly coding claims. A RCM system is able to communicate with the EHR and accounting systems to streamline the billing and collection cycles. The point of this is to successfully manage the

The new law includes an array of reforms to the way health care is paid for and delivered—reforms that reward the value and quality of care, not just the quantity of care. These signals to health care providers are already catalyzing change throughout the health care system. Financial pressures stemming from negotiations with insurance companies and higher drug costs are making it critical for U.S. providers to become more efficient. As for drug costs, Cosgrove said there is no doubt that pharmaceutical companies have delivered "tremendous" products. What people are objecting to is the practice of buying existing drugs and increasing the cost exponentially without improving the pills. Cosgrove said the Cleveland Clinic managed to reduce the cost of running its pharmaceutical supplies by $10 million, but those savings were offset by $11 million in cost increases by Valeant Pharmaceuticals, which has attracted government scrutiny for its pricing practices. Although many clinics and health care offices are adhering to consolidating to these new practices the quality of the care still remains. Many drug companies are producing affordable drugs that the clients can afford. Also many health care providers are streamlining pay option to people who don’t have insurance to get the health care they are needing whom otherwise may go without simply because treatment isn’t

What is RAC? RAC is a medical program designed by the Federal/State to allow States to receive matching funds from the Federal Government to finance medical assistance to eligible low income beneficiaries. The Department of Health Care Services has contracted with Health Management Systems to act as the RAC for the State. For about 25 years, HMS has worked in the Medicaid claiming environment to identify, audit, and recover improper Medicaid payments. Section 6411(a) of the Affordable Care Act amended section 1902(a) (42) of the Social Security Act to require that States and territories establish Medicaid Recovery Audit Contractor (RAC) programs. States that have not received an exemption from the Centers for Medicare and Medicaid Services (CMS) are required by statute to contract with one or more RACs to identify over payments and underpayments and to recover overpayments from Medicaid providers.

Conclusion

In this essay. I first explain what is it meant by revenue cycle and why is it so important to the healthcare system. Second I talked about and explain the control on cost and provided some examples. Lastly I explained RAC, which was once random audit contractor, but now is recovery audit contractor. Overall this essay breaks down three key factors: revenue cycle, control cost, and