The Process of RCM in US Healthcare

The healthcare industry in the United States follows revenue cycle management, a practice that helps organizations track and generate revenue from patients. The process usually starts with the appointment or hospital visit of the patients and ends with the final payment. An RCM may include a patient’s personal information and treatment information along with the financial billing information. It is essential for healthcare organizations to incorporate an effective RCM system to maintain financial solvency and provide quality patient care.

The Necessity of RCM in Healthcare:

For every organization, management plays a significant role in determining success by simplifying the service process.

For healthcare organizations, the entire process from initial registration to final billing may get complex. Without the help of a management system, there are chances of significant errors and delays.

There are multiple advantages of an RCM system for healthcare organizations. A successful RCM can streamline the entire process of services to ensure steady collections. It also makes the healthcare providers financially viable.

Since each hospital has its RCM process, it is essential to see whether these are thoughtful and well-implemented. The responsibility of a well-implemented RCM system is to track every nuance of services into account.

For all the above reasons, RCM plays a significant role in determining the success of a healthcare organization. One should opt for an RCM system integrated with maximum features to allow every task related to revenue management.

A successful RCM system should be integrated with features such as claim preparation, claim submission, claim management, receivables collection, analysis, and evaluation. These are the steps that make revenue management service complete. Today, many agencies provide a full-scale RCM service to healthcare organizations. Many organizations rely on CRM software, which ensures automated services.

An RCM ensures the possibility of:

  • Improving revenue performance
  • Greater visibility of data
  • Demonstration of value
  • Simplification of the process

The Process of RCM:

  1. Preregistration: It is the first step that allows the organizations to collect patient information before registration. By collecting insurance information and other valuable information from the patients, an RCM system can evaluate the patient’s facilities such as coverage, deductible, co-insurance, and co-payment.
  2. Registration: This step ensures that the patient information such as name, address, contact number, insurance information, etc. is accurate. Organizations need to secure the registration data each time a patient comes for treatment. Usually, financial forms are signed, and insurance benefits are explained during registration.
  3. Charge Capture: This step ensures that all billing charges are captured appropriately. Today, many organizations take advantage of automated revenue cycle management systems that can simplify the process. RCM software comes with such automated features to speed up the process.
  4. Claim Submission: Once the charges are entered, the healthcare organization’s revenue cycle team sends information to the insurance carrier. The team investigates the charges, the CPT code, and the diagnosis code to ensure insurance that the claims can be provided to the patients.
  5. Remittance Processing: It is the next step that sends remittance to the eligible patients. In this step, the revenue cycle team and the insurance carrier discuss and negotiate how much the insurance carrier will pay. This step also includes the determination of fee schedules or the amounts providers charge for each of their services.
  6. Insurance Follow-Up: In this step, the revenue cycle team follows up with the insurance, making sure which insurances are paid and which are still unpaid. If the revenue cycle team fails to follow up, the patients can request them to review their files.
  7. Patient Collections: The best time to get payment from a patient is during the service. Therefore, the front desk staff should be trained to collect the payment at the right time to avoid late collections, which is considered the most difficult part of the revenue collection cycle.


RCM is an essential part of healthcare in the US. While some organizations have their in-house RCM teams, others prefer outsourcing it from experienced RCM agencies. From eliminating the chances of errors and service delays to having a simplified approach towards the complex and difficult task of billing, revenue cycle management has multiple advantages. However, since there are numerous RCM software and apps available today, it is crucial to see the effectiveness and accuracy of these systems while choosing the most appropriate one for any organization.