In today’s highly competitive healthcare environment, the importance of robust revenue cycle management (RCM) cannot be overstated. Hospitals, clinics, and other medical providers rely on effective RCM to streamline administrative processes, eliminate billing errors, and improve cash flow. Ultimately, optimized RCM can lead to enhanced financial health and overall operational efficiency. In the quest for revenue cycle management optimization, key performance indicators (KPIs) play an integral role. Yet, the challenge lies in how to utilize these KPIs to effect meaningful change. In this blog, we will discuss three actionable tips for RCM optimization and how leveraging the right KPIs can contribute to improved revenue cycle performance.

1. Thoroughly Evaluate and Improve Denial Management

Denial management is a critical component of RCM, as denied claims can significantly hamper cash flow and revenue generation. Despite its importance, many healthcare organizations fail to address this issue effectively. In the simplest terms, denial management refers to the process of identifying, managing, and appealing denied claims from healthcare payers. Insurance companies often deny claims due to various reasons, including incorrect information, ineligible services, expired claim submission timelines, or coding errors.

These denials can have a significant impact on healthcare providers, leading to delays or losses in revenue. Here’s how to navigate and enhance your denial management process:

  • Analyze and Categorize Denials: The first step in denial management is to understand the reasons behind claim denials. Categorize denials into different groups like technical errors, clinical denials, or registration-related issues. Once categorized, analyze them to identify patterns or recurring issues.
  • Implement a Denial Prevention Strategy: Preventing denials should be the primary focus of any denial management process. This includes ensuring the accuracy of coding and billing, verifying patient eligibility in a timely manner, and following payer-specific rules for claims submission. By addressing these areas, healthcare organizations can significantly reduce the occurrence of denials.
  • Leverage Technology: Healthcare providers can also leverage technology to streamline their denial management process. Many software systems now offer features like automated reminders for claim submission deadlines, real-time eligibility verification, and automatic claim scrubbing to detect and correct coding errors before claim submission. This not only reduces denials but also frees up staff to focus on other tasks.
  • Provide Staff Training: Despite advancements in technology, the role of well-trained staff in reducing denials can’t be overstated. Regular training ensures that staff are updated with the latest coding changes, payer rules, and compliance requirements. A competent staff can identify potential issues that might lead to denials and correct them preemptively.
  • Develop a Denial Appeal Process: Even with the best practices in place, some claims might still get denied. Therefore, having a robust appeal process is essential. This involves understanding the appeals process of different payers, preparing a well-documented case for appeal, and tracking the progress of appeals to ensure they are resolved in a timely manner.


Denial management is not just about handling denied claims but involves a proactive approach to minimize their occurrence. It demands a combination of precise data analysis, process improvement, technology utilization, and continuous staff training. With effective denial management, healthcare organizations can significantly improve their revenue cycle performance and bottom line.

2. Business Process Outsourcing

Business Process Outsourcing (BPO) is a business practice in which one organization hires another company to perform a task the hiring organization requires for its business to operate successfully. BPO is often divided into two categories: back-office outsourcing, which includes internal business functions such as billing or purchasing, and front-office outsourcing, which includes customer-related services such as marketing or tech support. Some key benefits of BPO include:

  • Cost Efficiency: Business process outsourcing can provide significant cost savings by reducing overhead costs associated with staffing, infrastructure, and technology. Outsourcing companies often operate in lower-cost regions and offer economies of scale, passing these savings onto their clients.
  • Focus on Core Business Activities: Business process outsourcing allows organizations to dedicate their time and resources to their core business activities, improving productivity and efficiency. For example, a hospital might outsource its billing process to focus more on patient care.
  • Access to Expertise and Advanced Technology: Outsourcing partners often specialize in their respective fields, ensuring high-quality services. They stay updated with industry trends and advancements, providing access to cutting-edge technologies and expert personnel that an organization might otherwise struggle to afford.
  • Scalability: BPO offers flexibility in scaling operations based on business needs. Companies can ramp up or scale down their service requirements during peak or off-peak seasons without the hassle of hiring or laying off employees.

3. Optimize Billing and Collections

The billing and collection process is the final but crucial stage of revenue cycle management. Timely, accurate billing and efficient collections processes can drastically improve cash flow. Keep an eye on the average days in Accounts Receivable (A/R) — a critical KPI that represents the average number of days it takes a healthcare provider to collect payment from the time a service is rendered. High A/R days might indicate inefficient billing processes or ineffective collections practices. To address this, consider outsourcing to a specialized medical billing company or implementing a technologically advanced billing system to reduce errors and enhance efficiency. Establish a follow-up system for unpaid bills, and offer convenient payment options to expedite the collection process.

Revenue Cycle Management with Credence Global Solutions

Understanding and optimizing the revenue cycle management process is not a static task, but a dynamic and ongoing one that requires consistent oversight and regular adjustments. Credence Global Solutions, a renowned international firm, provides this exact expertise with a dedicated team of specialists proficient in Revenue Cycle and Accounts Receivable Management. Our services cater to a diverse range of industries including healthcare, telecommunications, utilities, and media & entertainment. With our team at your side, your revenue cycle process will be more efficient and seamless than ever, enhancing both insurance and patient payment procedures as well as improving collection times. For more information about our company and our services, please visit our website or contact one of our representatives today.