How Would Value-Based Reimbursements Affect Medical RCM?

It is no secret that healthcare in the United States is the most expensive in the world. Spending on medical services topped $4 trillion, more than the economies of all but a handful of countries. One of the main factors seen as being responsible for this is the existing fee-for-service model of reimbursements.   

Under the fee-for-service model, providers are paid for every service they offer. Needless to point out, this incentivizes many of them to provide too many services like tests, scans, etc. Amid the growing costs, the people and policymakers have been pushing for a change to a value-based model of reimbursements.  

Under the value-based model, providers will be reimbursed based on the clinical outcomes they achieve for their patients. However, this will require changes to existing healthcare RCM practices. The existing workflows require verifying health plans, coding clinical encounters, preparing claims, and processing payments. But this process would have to track patients’ progress and determine the reimbursement amount accordingly under value-based reimbursements.  

Additionally, the workflows for healthcare revenue cycle management would be even more difficult in the case of chronic diseases. Conditions such as diabetes, cancer, and heart problems require extensive coordinated care from multiple providers. In such cases, tracking and quantifying the number of reimbursements to be made would take a lot of work. Value-based models like bundled payments, Accountable Care Organizations (ACO), and Shared Savings help reduce costs.  

But mainstream healthcare revenue cycle management practices will need help adjusting for value-based models. This is because existing types of payments require documentation of medical services and their subsequent billing. However, under a value-based model, the criteria for activities involving the revenue cycle in healthcare would have to be different.  

The traditional healthcare revenue cycle management processes would have little relevance for value-based reimbursements. They would have to accommodate the outcomes as the basis for payments. In light of the growing push towards value-based payments, existing revenue cycle solutions would have to evolve their workings. In other words, value-based payments may not be suitable for current medical RCM practices.