9 Signs Your Organization Has an Optimized RCM Process

How do you (really) know if you have a streamlined revenue cycle process?

For revenue cycle management (RCM) professionals in the dental industry, ensuring that patients schedule appointments, that insurance is verified, and that bills are sent and paid are all positive results; however, not all approaches to achieve these results should be considered best practices.

There is a spectrum of efficacy when it comes to an RCM process, and all practice administrators fall somewhere on this scale.

But what most leaders at practices share is that they all think they’re doing it “the right way”. 

While the RCM process of your organization might ultimately get the job done, there are some clear-cut and objective signs that indicate an optimized set of practices.

Optimized for your staff. Optimized for your patients. Optimized for your cash flow.

To determine those signs of optimization, we looked at over 1,000 practices from our database and found trends from the most successful ones. From this analysis, we distilled nine characteristics and indicators of a practice with a healthy, optimized RCM process.

Without further ado, let’s dive into the list…

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1) 80-90% of balances are resolved without staff involvement

If your office staff is bogged down making collection calls, auditing patient balances, and sending physical statements every week, there’s room for improvement with your RCM process. Ideally, 80-90% of all balances should be settled without any staff involvement.

So what does this look like?

To start, the vast majority of billing notifications should be sent electronically and automatically once a balance is eligible and due. There should be options to self-pay through a link or QR code, and the checkout process should be convenient and intuitive.

With this set of practices in place, only billing mistakes and complex payment situations should require staff attention.

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2) You’re conducting regular A/R reporting and are showing adherence to industry benchmarks

While generally understanding how much patient A/R you have is important, running detailed reports that measure key performance indicators (KPIs) will give your organization a more productive perspective.

Benchmark metrics including accounts receivable (A/R) ratio, days in A/R breakdown, and collection ratio are all useful tools for measuring the health of your A/R management process. We dive into these metrics and more in our article on A/R benchmarking.

These reports should be run at the very least monthly and ideally every week.

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3) Your RCM policies are documented end-to-end across all offices

Establishing an optimized RCM protocol is one thing, but turning it into institutional standard operating procedures (SOPs) gives that protocol robustness. 

Especially for larger organizations, documenting your process end-to-end standardizes the best practices to ensure efficiency across all locations.

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4) You’re using digital workflow automation for patient billing communication

For a truly “hands free” RCM process, your practice needs digital workflow automations. This is achieved by leveraging software that can automatically target qualified balances, send an appropriate billing message, and offer easy-to-use payment options.

RCM apps like Pearly give practices and DSOs a set of tools that collect patient A/R more effectively and in the background.

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5) Your billing process has user-level customization with cohort-based messaging

Once your practice starts to implement workflow automations for RCM, the next step is to tailor those workflows to your organization and patient base.

For your organization, standardizing message templates and sending cadences will allow you to keep a consistent brand voice and establish a system where iterations to the workflow can be made across offices easily.

For your patients, setting up cohort-based messaging will improve the quality and fit of billing communication.

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6) Your RCM staff is well-trained and continues learning through continued educational programs

Your process is only as good as the staff that implements it. Having a well-trained RCM team that can effectively manage A/R, bill, verify insurance, and register patients is essential to optimizing a revenue cycle.

But training once without a plan for continued education and ability assessment is a pitfall of many practices.

It’s best to incentivize continued education in RCM and build institutional knowledge through shared experiences and CE learnings.

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7) Your inbound-to-outbound call ratio is greater than 1.

This is a bit of a controversial indicator, as every practice has a different dynamic when it comes to billing-related phone calls.

From what we’ve seen in our practices, the locations with lower ratio of outbound calls (for A/R collection) to inbound calls (for billing clarification and payment acceptance) ultimately have lower staff hours dedicated to phone tasks.

There is a big difference between making outbound calls for payment and receiving calls to answer billing questions. Making outbound collections calls requires more time–not everyone picks up and messages need to be left–and is an experience that can irk patients.

On the other hand, inbound patient calls are customer service opportunities that give practices a chance to both collect payment and build relationships with patients.

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8) You dynamically offer payment plan options & alternative digital payment options

Every patient has a preference for how they want to communicate with practices and pay their bills. By offering convenient payment options including Apple Pay and having a flexible, easy-to-use payment portal to accept it, optimized practices reduce friction to pay and ultimately collect A/R in a more timely manner.

For larger balances, dynamically giving patients financing options via Pay-Over-Time will further reduce collection efforts.

By “dynamically” we mean according to their balance size and age, and automatically triggering as part of a billing workflow.

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9) Your billing communication uses escalating language

While sending a timed-out series of billing notifications might increase the odds of payment, repeatedly sending the same notification isn’t an ideal method. We see the best collection results from practices that add variety to their billing communication and that escalate the language as their patient balances age.

For instance, sending a short, friendly notification with links to pay immediately when a balance is eligible is a good way to start. Later on, when a balance is 90+ days past due, including a strongly-worded pre-collection notice provides a more serious tone and can inspire action from delinquent patients.

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How your revenue cycle will progress

As your practice checks off these indicators, you’ll find that your RCM process is becoming more sophisticated and robust. This progression is known as the RCM Maturity Model.

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We provide an in-depth detailing of this model and how it can impact practices in our webinar with Dental Success Network (DSN), and explain the characteristics of each stage of progression.

Whether your practice has a haphazard RCM process or is a well-oiled machine, there is always room for improvement. 

With Pearly, your practice can collect more (faster), and can automate billing tasks to allow you and your staff to focus more on patient care.

If you are interested in learning about our free 30-day pilot program, you can book a demo with one of our RCM experts.

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