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Revenue Cycle: Circular or Linear?
The term 'Revenue Cycle' references a chronological sequence of fiscal and operational activities that essentially follow a set pattern, repetitive in nature. The image this conjures up is that of a smooth motion that is arguably controlled and is full of second chances. You miss something, fear not, this is a cycle, you fix and restart.
We all know that a patient encounter can technically be sent in and out of the books of accounts and billing systems for a long period of time and then is soon devalued (written off, ‘cleared’). The visible expense of accounts/encounters cycling around is manifold, namely, wasteful hours ‘chasing the $$’, innovative ways and sub processes to control these exceptions. Oftentimes the overall financial impact is ‘washed out’ under credit balances and adjustments.
My challenge is accepting the fallacy of a cycle. If one were to take a typical revenue cycle and explain its components, we have a distinct financial beginning of an encounter, with the making of an appointment, and distinct ending in financial resolution of the patient encounter, regardless of revenue collection. Many tandem and sequential steps lie in between, all of which move in a forward motion and no arc forms for the encounter at any of these steps to start bending back towards its origin...like a cycle.
The entire value of the sequential, chronological steps is to ensure that activities that make up a resolution must move in haste towards the end goal. Never to return into the books of accounts! Calling the sequence of activities a cycle, falsely alludes to the fact that if any of the steps are missed or done incorrectly, then we have a chance to redo the exact same process for the exact same encounter. If these steps are to be repeated, such encounters are considered exceptions and anomalies that need to be fixed and then sent back out to finish their linear progression. Repitition is not the norm.
Strictly speaking what we name the process doesn’t have any impact, at least not on the mindset of staff that work the accounts. It is more on the leaders monitoring the cycle and reducing exceptions.
For a moment, what if we were to call this process Revenue Arrow! What image does that conjure? A process that is headed towards an end target and the precision with which it is aimed and controlled will ensure it meets the target. There are no second chances once it is shot out of the ‘Bow’. You don’t get another chance and the loss is booked without allowing the account to come back into the system. Yes, a bit ruthless, knowing that we don’t live in a perfect world where payments are guaranteed and we will never make mistakes. But I will argue that it does change the risk bearing mindset. It generates the empowering notion of continuous honing the skills of leaders and individuals in charge of revenue and revenue system design.
Given that we are well on our way with billing system designs that are quite linear and proponents of exception based work queues, we are already in the Revenue Arrow workflow universe!
Therefore in this context, I will disagree with Shakespear and claim that “A rose by a different name, might smell sweeter!”
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