In the United States, healthcare can be complicated. Our healthcare revenue cycle process is complex, nuanced and ever-changing. Understanding the ins and outs of the healthcare process is easier said than done, but we believe knowledge is power and the more you know, the bigger the impact you can make.
At Signature, we are passionate about bending the curve of healthcare administrative costs and transforming the industry. Without fully understanding the industry as a whole, making an impact can be challenging. We are uniquely positioned in between the four quadrants of healthcare; Payer, Providers, Public and Private, and are confident that we have an unmatched perspective on the healthcare industry. Improving the communication between these groups helps reduce administrative costs, burdens, and inefficiencies and is what makes Signature an unstoppable force in the industry.
So, if we’re really going to change healthcare, we have to know healthcare. When trying to understand the healthcare industry, learning the steps of the revenue cycle process and the differences between payers and providers is a great place to start.
So what does that mean exactly? What is the Healthcare Revenue Cycle? How do Payers and Providers interact? Do Payers or Providers come first in the Revenue Cycle process? What is healthcare 101?
Understanding the Healthcare Revenue Cycle Process
Let’s start with deepening our understanding of the Revenue Cycle Process in healthcare. The Revenue Cycle involves many steps in which both Payers and Providers play a crucial role. As an example, the Revenue Cycle process could start with the scheduling of a routine doctor’s appointment and end with the provider getting paid for the services they provided during said appointment. Let’s break it down a bit further.
Step One: Preregistration
Patient schedules appointment with provider and provider collects insurance information to determine possible charges.
Step Two: Registration
Provider collects additional patient information during formal registration/actual appointment time such as co-payments, and if necessary, referral and or pre-authorizations.
~ Actual Appointment Occurs / Care is Received ~
Step Three: Charge Capture
Provider renders medical services provided into billable charges and creates the patient’s bill.
Step Four: Claim Submission
Provider submits billable charges in the form of a claim to Payer establishments. Claims are then analyzed for errors and corrected accordingly. More errors means the claim is less likely to get paid by insurance in a timely manner.
Step Five: Remittance Processing
Payments are applied and/or rejected based on remittance processing standards. In other words, Insurance will cover some or all of the charges based on the patient’s plan coverage and will send the payment back to the provider.
Step Six: Insurance Follow Up
Payments are collected from third party insurers. Providers then examine what’s been paid and what is still owed.
Step Seven: Patient Collections
Provider determines the amount owed by the patient after insurance payouts, if any, and collects the payment. The Patient will then be charged the remaining balance in the form of a billable statement usually sent every 30 days until payment completion.
Seems simple, right? As you can see, there are many steps to the revenue cycle process which can create many opportunities for error if you don’t have a properly functioning system or adequately equipped team. Our Signature team has almost twenty years of experience providing revenue cycle services to both Federal and Commercial clients. To further understand where and how Signature impacts this system, let’s dive deeper into the difference between Payers and Providers.
So, what exactly is a Payer?
In layman's terms, a Payer is who pays for medical services, think- insurance. In a more official capacity, a Payer can be considered as a person, organization, or entity that sets service rates, collects payments, processes claims and or pays for the care services administered by a healthcare provider.
A Payer’s main responsibility is to ensure that providers get paid for the services and care they administer to you and your family. Without a healthy and successful Payer system, Providers are limited in the quality and timeliness of care they can provide due to funding and processing issues. More on that later.
However, Payers do more than pay Providers for their services. They also set pricing standards, communicate with third-party administrators, and process claims, which are all important steps in the revenue cycle process. We need strong, healthy, Payers to help keep our healthcare system moving forward in an efficient manner.
So, Providers are just Doctors, right?
Not exactly. Healthcare providers are defined as any person or organization that offers healthcare services usually in the form of outpatient medical services or procedures. So think beyond your primary care doctor and think about your dentist, your dermatologist, or the clinic you visited to run a routine blood test. After care is administered, Providers then charge the patient and/or their insurance, for the services they received so they can be paid for their work.
You may be saying, “Well, of course that’s how it works.” And you’d be right, it should be that simple. But who communicates between the Payers and Providers? Who determines the cost of care? Who intervenes if Providers don’t get paid, or if they provide low-quality care?
Que Signature Performance and our team of industry experts. With each branch of our healthcare system providing pivotal services it is important that they have seamless communication and structures in place to ensure patients receive high-quality and affordable care. We focus on streamlining administrative processes so Payers can focus on increasing efficiencies and Providers can focus on providing care.
Payers, Providers, and the Healthcare System
Did you know that over 40% of healthcare spending is used to pay for administrative functions? This could include paperwork, billing, scheduling, and other administrative tasks. Now, obviously we need these processes and procedures to have a functioning healthcare system, but what we want to avoid is our Providers spending their time on paperwork rather than providing care.
According to the American Medical Association, Providers are spending more time than ever on administrative tasks. In fact, over one third of Providers surveyed admitted to spending more than 20 hours per week on administrative related functions.
Physician Burnout enters the chat.
What people don’t often realize is that these same Providers are actually NOT spending less time treating patients but are working extra hours, missing meals and or sleep, skipping routine steps and experiencing unprecedented levels of burnout and mental health issues.
As we all know, there are only so many hours in the day and now that Providers are being pushed to add an extra 20 hours to their work week to handle administrative requirements, there are flaws in our healthcare system. Unfortunately, these system failures affect more than just Payers and Providers. Not only do these extra administrative burdens cause Physician Burnout and revenue cycle delays, but they also put patients at risk for receiving lower-quality, less-specialized care.
Standing in the Gap
So back to our first question, how does this all work and where does Signature impact this process? The answer is everywhere! Without Payers, Providers wouldn’t have set pricing structures, would have to spend even more time working on administrative tasks and might not get paid for their work. Without Providers, Payers would simply cease to exist…with no care being administered, there would be no claims to process or medical bills to pay. And most importantly, without these two segments of the healthcare system, people who need care most might not have the proper access or be able to afford it.
Having a passion for improving our healthcare system is what makes Signature an excellent partner to both Payers and Providers. We understand that in order for our healthcare system to be healthy, we need to make sure all parts are working together in an efficient and synchronized way. What makes Signature unique is that we understand the needs of both Payers and Providers. Our unmatched experience allows our team to craft custom revenue cycle solutions by combining our people, processes, and technology systems. We are passionate about lowering administrative costs and burdens and are dedicated to bending the financial curve in healthcare.
To read more about our dedication to transforming the healthcare industry, check out our latest posts on The Link.