Draftof Reimbursement and the Revenue CycleThe hospital revenue cyclebegins when a patient or physician decides the need for a medical service. Theprocess itself does prove to be effective with the collaboration of alldepartments.
It is crucial that the entire facility must understand thesignificance of the role they play to ensure that payments are received in atimely manner. It then ends when the charges connected with the service havebeen resolved through insurance payments, contractual adjustments, write-offs,or patient payments (Singh, Mindel, Mathiassen). The revenue cycle managementincludes the processes and guidelines to all departments in order to bereimbursed by either the patient, the government or the insurance companies. Ifno payments were received, healthcare organizations would have a difficult timepaying salaries, equipment and other items to provide care (Harrington, 2016). The organization needs to lookat the balance sheet to display the information about their assests and ownersequity along with the financing structure of liabilities and equity accordancewith GAAP. The report looks at thefollowing items to asses the financial position of the organization, includingliquidity of the organization or the level of cash in the operating system,financial flexibility or the organizations ability to respond to unexpectedturns in the financial position of operations, the organizations ability to payits debts when they come due, and the ability to distribute cash to the ownersor the shareholders (Harrington, 2016). The income statement is also crucial inlooking at in order to know if any changes are necessary in the organization.
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The income statement is intended to show how much money a company is gaining orwasting. Also, by looking at budget cycles it gives the organization time forthe management team to gather historical data and forecast the activity for thefuture fiscal year. Every department within ahealthcare organization plays a role in reimbursement.
Thefirst step toward revenue cycle improvement is to educate the financialservices staff about the importance of their roles, timeliness in managingpatient accounts, monitoring the right performance indicators andaccountability at all levels (The Revenue..).
Clinical services is where allclinical documentation is completed and will assist the facility in validatingthat the services were actually rendered to the patient. The next department isthe patient accounts department which is responsible for gathering all thetransactions that are recorded in the patient account through the chargemaster, producing a bill for the payer, and sending it to them either on paperor via electronic transmission. Health information management is the oneresponsible for the soft coding of the inpatient medical records. This softcoding process is where the coding department assign diagnosis codes, procedurecodes, and query the physician with any questions regarding documentation ofthe patients illness and treatment.
Once that is done the chart is finalizedand the bill is dropped and sent to the patient accounts department forprocessing to the payer (Harrington, 2016). ReferencesHarrington, M.K. (2016). Health carefinance and the mechanics of insurance and reimbursement. Burlington,MA: Jones & Bartlett Learning.
ISBN: 978-1-284-02612-2Singh, R., Mindel, V., & Mathiassen, L.
(2017). IT-Enabled Revenue Cycle Transformation in Resource-ConstrainedHospitals: A Collaborative Digital Options Inquiry. Journal Of ManagementInformation Systems, 34(3), 695-726.The Revenue Cycle: Creating an Environment WhereRevenue Can Thrive. (2017). HealthLeaders Magazine, 20(5), IFS-3.