Unpacking the mid-revenue cycle, strategies for success

What is the mid-revenue cycle?

The mid-revenue cycle refers to the phase in revenue management between the point of patient access and care delivery (front-end) and the billing and reimbursement phase (back-end). The mid-revenue cycle encompasses a series of processes and activities to accurately capture patient data, document clinical procedures, code diagnoses and treatments, and ensure compliance with regulatory requirements.

Key components of the mid-revenue cycle include:

• Clinical Documentation Improvement (CDI): CDI involves enhancing the quality and specificity of clinical documentation to reflect the severity of patient illness and the services provided, which in turn impacts coding accuracy and reimbursement.
• Coding and edits: Coding in healthcare translates diagnoses, procedures, and services documented in patient records into universal codes, such as ICD-10-CM (diagnoses) and CPT (procedures), to facilitate billing and claims processing. Claim coding edits make corrections to previously documented codes to prevent or work denials.
• Charge Capture: During charge capture, all billable services and procedures provided to patients are documented accurately to ensure appropriate reimbursement. The process includes capturing both professional and facility charges to ensure proper reimbursement.
• Compliance: Ensuring compliance with various regulations and guidelines, such as those set forth by CMS and other regulatory bodies, is a significant aspect of mid-revenue cycle. Strict compliance prevents penalties and ensures accurate billing and reimbursement.
• Revenue Integrity: Revenue integrity involves identifying and addressing potential issues or discrepancies in the revenue cycle process to optimize revenue capture and prevent revenue leakage.

The mid-revenue cycle also touches on case management. Case management is primarily a clinical area where clinicians manage patient care from admission to discharge to verify that patients receive the right treatments in the right setting. What treatments a patient receives and where can affect the revenue cycle since payers may not cover the treatments providers choose for their patients. Case management in the mid-revenue cycle looks to identify coverage, ensure appropriate utilization of resources, and guide providers to cost-effective care.

How to track mid-revenue cycle performance

Key performance indicators (KPIs) for the mid-revenue cycle inform providers about the quality of clinical documentation and coding. They also allow providers to identify coding, clinical documentation, and compliance breakdowns that result in claim denials, reimbursement delays, and inaccurate payments.

Mid-revenue cycle KPIs can be broken down by area within the middle part of the revenue cycle.

To track CDI performance, for example, a recent leadership research survey from the Association of Clinical Documentation Integrity Specialists and 3M found the most important KPIs in this area. Among the most important, according to at least three-quarters of respondents, were query response rate, new/re-review chart reviews per day, and query rate.

For coding performance, providers should be tracking accuracy rate (percentage of accurately coded claims versus the total number of coded claims), turnaround times (how long it takes to code from the date of service to claim submission), coder productivity (number of medical records coded per hour), and days to final bill (number of days from time of service until provider generates and submits claim). Providers can also glean insights about coding performance from monitoring their claim denial rate. They should look at the denial rate and reasons for denials to identify authorization versus coding denials.

Charge capture itself is a KPI that providers can use to monitor mid-revenue cycle performance. The KPI measures the time taken to capture charges for services rendered. The result gives providers insight into the timeliness of claim generation. Additionally, providers can track the charge capture rate (the percentage of billable services captured versus total services provided) and the charge reconciliation rate to determine accuracy.

Major compliance KPIs for mid-revenue cycle include coding compliance audit results, denial rate, and audit findings resolution time. The denial rate can, again, help providers identify coding issues leading to denials and reimbursement delays. Meanwhile, auditing results and corrections from those results are vital to measuring an organization’s compliance within the revenue cycle.

Finally, top revenue integrity KPIs that providers should track into the net collection rate (percentage of expected reimbursement collected after adjustments and write-offs), clean claim rate (percentage of claims submitted without errors or discrepancies), and revenue leakage (amount of potential revenue lost due to coding errors, denials, or underbilling).

Identifying the KPIs providers should track to monitor mid-revenue cycle performance is challenging. Providers will need to prioritize KPIs based on their opportunities for improvement within the revenue cycle (e.g., reducing the denial rate or capturing more charges). They will also need to compare their performance with their peers since claim denials and reimbursement trends may change from region to region or facility type to facility type.

Best practices for mid-revenue cycle improvement

Effective mid-revenue cycle is just as important as streamlining front- and back-end revenue cycle processes. With best practices in place, providers can optimize revenue capture, ensure regulatory compliance, prevent claim denials, and boost the overall financial health of the organization.

Still, there are challenges with clinical documentation, coding, charge capture, and other mid-revenue cycle areas that can slow the revenue cycle or even bring it to a complete halt.

For example, research indicates that clinical documentation could be improved, on average, in more than half of medical charts. Many providers point to provider time constraints and knowledge gaps between medical language and coding nomenclature as the primary reasons clinical documentation takes a hit.

Clinical documentation improvement or integrity (both known as CDI) programs can target medical chart challenges and provide resources for clinicians documenting patient cases. According to the American Health Information Management Association (AHIMA), CDI programs should “facilitate the accurate representation of a patient’s clinical status that translates into coded data.” Courses for clinicians and administrative staff can bridge knowledge gaps, especially as code sets are updated. Meanwhile, technology can support CDI programs. For instance, providers can leverage EHR scribe tools to automate documentation. AI is also supporting clinical documentation through ambient technology.

Coding technology also facilitates greater productivity and accuracy in medical coding. For example, computer-assisted coding solutions are popular technology implementations to help optimize coding and billing. There are also several use cases for AI and medical coding, which could elevate the level of technology used for coding and billing purposes. Over half of provider organizations also use autonomous coding or plan to do so shortly, according to a survey of providers last year.

Technology is poised to optimize the mid-revenue cycle. However, the intricacies around medical coding, clinical documentation, and charge capture still require humans with keen eyes to review what technology like AI can pull out of patient records for billing purposes. Integrating technology into workflows and training staff on using technology like AI to support their work, rather than take from it, will be key to finding the right balance in the mid-revenue cycle.