How Robotic Process Automation Optimizes Revenue Cycle Management

February 27, 2024 - Revenue cycle management technology comes in all shapes and sizes depending on a healthcare provider’s goals. One of the more popular forms of technology in RCM is robotic process automation (RPA).

RPA is a technology that leverages bots or programs to imitate how a human would interact with software to complete high-volume, repeatable tasks, such as logging into applications, entering data, and copying data. For this reason, RPA has been a highly sought-after technology for RCM optimization.

Revenue cycle management involves a series of administrative and financial processes to manage the healthcare organization’s revenue stream, from patient registration to final payment for services rendered. Many of these processes contain repetitive and rules-based tasks. For example, revenue cycle staff must enter patient information, insurance details, and billing codes in order to establish a patient visit and submit claims to payers for reimbursement. Typically, this process is done manually by revenue cycle staff.

Data entry is just one example of manual RCM work. The healthcare revenue cycle is full of these manual, repeatable tasks, from claims processing and eligibility verification to payment posting and denial management.

RPA can help providers optimize revenue cycle management by leveraging technology to complete some of the more straightforward tasks, leaving their staff to manage more complex, value-adding activities like tackling complicated denials and tailoring payment strategies to patient preferences.

What is RPA, how RCM can benefit

RPA is likened to a virtual assistant that can handle repetitive, time-consuming tasks in daily administrative processes. RPA technology mimics what in-house staff do on a daily basis to free them up for more mission-critical responsibilities around patient care.

The key to RPA is that it does not replace a staff member. The technology acts more like a digital helper to perform rules-based and repetitive tasks alongside a practice’s team of revenue cycle professionals. For example, it can help to verify a patient’s insurance eligibility, process billing information, and manage appointment scheduling to a certain extent.

Leveraging RPA technology can significantly enhance revenue cycle efficiency by taking away some of the manual tasks staff perform. The technology can perform routine tasks like claims processing much faster than the average human and reduce the likelihood of errors stemming from manual data entry. Together, the efficiencies gained from RPA technology can reduce cost to collect, turn around faster reimbursements, and minimize claim denials.

Meanwhile, staff can focus on tackling more complex tasks that require critical thinking. For instance, some claim denials are complicated, requiring providers to revisit coding and clinical documentation to gather evidence to justify reimbursement for services rendered. Many practices do not have the capacity to take on many complex claim denials without the use of some automated technology, whether due to staffing shortages or the volume of claim denials. Yet, these denials may return a significant amount of money to the provider if reworked or appealed.

RPA can also improve accuracy and compliance across revenue cycle areas, such as claims processing. For example, the technology can check claims information against payer rules and regulations, minimizing the risk of claim denials due to common eligibility errors.

Practices can also scale RPA technology quickly to handle more transaction volume, a feature many organizations may value as they prioritize merger and acquisition activity.

Overall, RPA can enhance the patient experience by making the billing process smoother. An efficient revenue cycle means bills go out faster and with fewer errors. Practices can even leverage RPA technology for processing invoices.

Top use cases for RPA in revenue cycle management

With various benefits, RPA can address numerous challenges and streamline critical processes in revenue cycle management. Applying RPA technology to the revenue cycle, such as claims processing, patient eligibility verification, and patient scheduling, can help practices increase efficiency, scale productivity, and improve overall financial performance.

Claims processing and adjudication

Claims processing comprises many steps to create and submit a claim to a payer for reimbursement, after which providers receive a payment determination and must post the payment depending on the claim’s outcome. One misstep could lead to a delay in reimbursement or claim denial.

A misstep may not be a major one, either. For example, a 2023 survey of healthcare financial leaders found that eligibility errors, missing prior authorization, lack of documentation to support medical necessity, and incorrect patient information were top reasons for claim denials.

RPA can be applied to claims processing and adjudication steps to prevent these avoidable errors and reduce the risk of denials. The technology can automate data entry by extracting relevant information for claims (as long as the data is already accurate) and populating claim forms, thereby reducing errors from manual entry.

Practices have also found that RPA can validate claims against payer rules and guidelines to avoid missing prior authorization or lack of documentation. The technology has also been used to track denial patterns, automate the resolution process, and generate appeals for denied claims.

One of the more common uses for RPA in revenue cycle management is for payment posting. RPA can streamline the posting process by automatically updating practice management and accounting systems with payment details taken from payer payment determinations. The technology can also reconcile payments with the associated invoices to identify discrepancies.

Patient eligibility verification

Ensuring patients are eligible for the medical services they are scheduled for is key to quick and accurate reimbursement. However, this is often a manual process in which staff verify eligibility against payer rules and guidelines prior to the appointment. RPA technology can eliminate some of that manual work to automate patient eligibility verification and get patients and claims out sooner.

Technology solutions can leverage RPA for real-time verification of a patient’s eligibility for specific services. RPA can specifically pull data from payer portals and the EHR or practice management system to check insurance status and eligibility, leading to quicker appointments and fewer claim denials for eligibility issues.

Prior authorizations

Prior authorizations are one of healthcare’s biggest pain points. Providers not only cite prior authorizations as the most burdensome regulatory issue they face, but also a majority also agree that they cause care delays, abandoned treatment, and adverse clinical outcomes.

Research shows that prior authorization requirements are only increasing despite their burden on providers, so many practices are turning to technologies that incorporate RPA to help them complete prior authorizations.

RPA technology can make checking a prior authorization’s status easier, much like the technology verifies patient eligibility. Practices can implement technology solutions that use RPA to analyze patient medical records in real time to identify the necessary data elements for a prior authorization request. The technology can also determine if a prior authorization request is needed from a specific payer for a particular service based on the payer’s rules and guidelines.

Appointment scheduling

Practices have found that appointment scheduling and related patient access tasks can be managed effectively with RPA technology.

Patient no-show rates have risen after the COVID-19 pandemic, with a 2022 MGMA poll finding that about half of medical groups report an increase in their rates. Medical groups believe that patients are more hesitant to seek care due to cost, lack of transportation to appointments, go elsewhere due to long wait times, or simply forget or don’t care to go to their scheduled appointment.

Scheduling issues are costly for practices. However, medical groups reporting declining no-show rates said online patient check-in options and additional text, email, and phone reminders prior to the appointment have helped.g

Patient access solutions that use RPA can automate some of the strategies practices have used to reduce no-show rates and other scheduling snafus. The technology can pull patient data to assist with registration and even help schedule appointments by provider availability, patient diagnosis, location, and other criteria.

Additionally, practices have used RPA to create reports for referral management to complete appointments.

Key considerations for applying RPA

Practices can benefit significantly from automating revenue cycle tasks with RPA technology. However, RPA is not a fit for every area within revenue cycle management; expertise is required in certain areas, such as denials management and coding. The market for RPA technology in revenue cycle management is also highly competitive, meaning providers need to do their due diligence to find the right partner for their needs and goals.

Providers should have clear goals for technology implementations. What processes need to improve for better financial performance? What processes within a revenue cycle area are manual and can benefit from automation? What are the specific goals a practice wishes to meet by automating processes?

RPA is ideal for rules-based, repetitive tasks like prior authorization requests, eligibility verifications, and payment posting. These tasks are time-consuming and contain manual processes ripe for technological disruption.

Providers will also need to consider their existing IT systems. Will a new technology solution with RPA integrate or be compatible with the EHR, practice management, or accounting systems? RPA often relies on the data in other IT systems to complete its task, meaning the RPA solution will need to understand and extract data from existing systems. A lack of interoperability can be an insurmountable challenge, depending on how limited a practice’s resources are.

Additionally, vendor selection is critical for successful RPA implementation. Providers should consider a vendor’s data security protocols, regulatory compliance adherence, ROI, and scalability. Technology implementations in revenue cycle management are major disruptions to workflows that require customer support, change management, and demonstrable ROI (i.e., cost savings, time savings, error reduction, and improved revenue collection).

RPA technology has found a happy home in revenue cycle management, and many providers are reaping the rewards from implementations. The technology is setting the foundation for increased automation within a very manual space in healthcare. Practices should leverage RPA to realize cost and time savings, as well as increased productivity, as they set themselves up for more sophisticated technology investments.