Health care in the United States is constantly changing, with new regulations and policies being developed to improve patient outcomes, increase access to care, and reduce costs. Impact of Healthcare Reform on RCM, keeping up with these changes is essential for Revenue Cycle Management (RCM) professionals. New regulations can impact everything from billing and coding to claims processing and reimbursement.
RCM organizations can use this newsletter to navigate the changing regulatory environment in light of recent healthcare reforms.
The Role of Healthcare Reform in RCM
n healthcare reform, a wide range of policy changes are made that affect the way healthcare services are provided, paid for, and regulated. Federal, state, and local governments can drive these reforms, which typically aim to control costs, improve quality of care, and enhance access to services.
The impact of healthcare reform on RCM is significant, as these reforms present both opportunities and challenges for RCM professionals. Billing and compliance can be made more complex by regulatory changes, but they can also maximize reimbursement and improve efficiency.
RCM processes have been directly impacted by reforms that have focused on value-based care, expanded telehealth services, and changed Medicare and Medicaid policies. In order to maintain financial health, healthcare organizations must ensure their RCM strategies align with the new regulatory requirements as they adapt to these shifts.
Key Regulatory Changes Impacting RCM
There have been several recent regulatory updates that have impacted the way RCM professionals manage financial processes in healthcare organizations. Below are some of the most significant updates and their implications:
Value-Based Care Expansion
Many healthcare reforms revolve around the move from fee-for-service models to value-based care (VBC). Under VBC, providers are rewarded for their quality and efficiency of care rather than their quantity. The RCM must focus on tracking performance metrics, patient outcomes, and performance-based payment models under this model.
- Quality Metrics Management: In order to measure quality, RCM teams need to ensure accurate documentation and coding, such as readmission rates, chronic condition management, and preventive care. By doing so, penalties and incentives can be avoided from programs like the Merit-Based Incentive Payment System (MIPS) and Medicare Shared Savings Program (MSSP).
- Data Analysis: Professionals in RCM need robust analytics capabilities when tracking performance against value-based benchmarks, identifying gaps in care, and adjusting billing practices to maximize reimbursement.
Telehealth Reimbursement Policies
During the COVID-19 pandemic, telehealth adoption increased, which led to permanent changes in reimbursement. Despite the fact that the Centers for Medicare & Medicaid Services (CMS) have expanded their coverage of telehealth services, billing and coding guidelines for telehealth services continue to evolve.
- Billing and Coding Adjustments: The RCM team must remain aware of changes to the telehealth billing code, including the appropriate use of modifiers, such as 95, which indicates services provided via telehealth. Accurate coding is essential for avoiding denials and ensuring timely payments.
- Compliance with State and Federal Regulations: Telehealth reimbursement rules may vary from state to state, making it essential for RCM professionals to understand the specific requirements in each region where their organization operates.
No Surprises Act and Billing Transparency
Patients will be protected from unexpected out-of-network medical bills under the No Surprises Act, which took effect in 2022. In order to help patients understand their financial obligations before receiving care, the act requires providers to provide clear and upfront estimates for scheduled services.
- Increased Emphasis on Upfront Communication: It is vital that RCM teams develop processes for providing Good Faith Estimates (GFEs) to patients and ensuring that these estimates are accurate. This can prevent disputes and minimize the risk for delayed payments.
- Coordination with Insurers: When determining patients’ cost-sharing responsibilities and resolving billing discrepancies, RCM professionals must work closely with insurance companies to comply with the No Surprises Act.
Medicare and Medicaid Updates Affecting RCM
A major payer in the U.S. healthcare system, Medicare and Medicaid, have introduced new billing codes, adjusted payment rates, and implemented additional compliance requirements in recent updates.
Medicare Advantage Changes
Over 30 million Americans have enrolled in Medicare Advantage plans, which have recently been regulated by CMS to provide greater transparency, standardization, and fairness.
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- Navigating Prior Authorization: To prevent interruptions in care and reimbursement, RCM professionals should streamline prior authorization processes and minimize delays. MA plans often have more complex prior authorization requirements than traditional Medicare.
- Risk Adjustment Coding: The accuracy of risk adjustment coding is critical if reimbursement rates are to be calculated based on the complexity of the patient’s condition. RCM professionals must ensure that documentation accurately reflects the true health status of patients in order for them to be eligible for reimbursement.
Medicaid Redeterminations
After the Medicaid continuous enrollment provision expired in 2023, states had to reevaluate Medicaid beneficiaries’ eligibility for coverage, resulting in a wave of Medicaid redeterminations. Some patients may lose coverage and switch to another insurance plan, which is a concern for healthcare organizations.
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- Eligibility Verification: Patients may switch from Medicaid to marketplace plans or employer-sponsored insurance, so it is essential for RCM teams to verify eligibility before services are provided. This helps prevent claim denials and delays.
- Outreach and Patient Education: The role of RCM professionals can include educating patients about their options if they lose Medicaid coverage, helping them to understand their alternatives and ensuring that their care is uninterrupted.
The Inflation Reduction Act and Its Impact on RCM
A major provision of the Inflation Reduction Act (IRA) of 2022 aims to make prescription drugs more affordable for Medicare beneficiaries. This includes price negotiation for certain high-cost drugs, a cap on out-of-pocket expenses, and limits on price increases.
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- Changes in Prescription Drug Billing: When the IRA’s drug pricing reforms take effect, RCM teams will have to adjust billing practices, especially for Medicare Part B and D medications. In order to understand how price negotiations impact reimbursement, it is necessary to know which medications are subject to price negotiations.
- Patient Cost-Sharing Calculations: As Medicare beneficiaries face out-of-pocket costs caps, RCM professionals are required to make accurate calculations of patient responsibilities, which can affect collection processes and financial planning.
Compliance Challenges and Opportunities
RCM professionals can take advantage of these challenges for improving processes and improving their organization’s financial performance by adapting to new compliance requirements.
Proactive Denial Management
As regulations change, claim denials become more common, whether due to incorrect coding, inadequate documentation, or changes in policy. By identifying common denial reasons and implementing solutions to address them before they occur, RCM professionals can take a proactive approach to denial management.
Investing in Technology and Automation
As healthcare regulations become more complex, manual processes become inefficient. By investing in technology, such as artificial intelligence (AI) and robotic process automation (RPA), eligibility verification, claims cleansing, and prior authorization can be streamlined. In addition to reducing administrative burdens, these tools help ensure compliance with evolving rules.
Enhancing Patient Engagement
Providing transparent billing information, offering payment plans, and simplifying the process for requesting financial assistance can support improved patient engagement as patients take greater financial responsibility for their care. In addition to improving patient satisfaction, this may reduce the likelihood of late payments or disputes.
Preparing for Future Regulatory Changes
Healthcare professionals must stay aware of new policies and adapt as they continue to emerge. Here are some strategies to prepare for future regulatory changes:
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- Continuous Education: Assurance that RCM staff understands and implements the latest regulatory requirements requires regular training and education sessions.
- Collaboration with Legal and Compliance Teams: Maintaining compliance with new regulations and avoiding costly penalties can be made easier by working with compliance experts.
- Leveraging Industry Resources: It is important for RCM professionals to stay updated on the latest changes in healthcare policy by subscribing to industry newsletters, attending conferences, and participating in webinars.
As medical services are delivered, reimbursed, and regulated, healthcare reform is continuing to reshape how they are delivered, reimbursed, and regulated. The impact of healthcare reform on rcm is profound, making understanding and adapting to these changes a key component of ensuring financial stability, compliance, and patient satisfaction.
A proactive approach to challenges enables healthcare organizations to navigate the complexities of healthcare reform and thrive in an evolving environment by staying informed about new regulations and investing in technology