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From Coding to Denials, AI is Improving RCM Processes

Analysis  |  By Jasmyne Ray  
   October 07, 2024

AI has immense potential to save organizations time and money by optimizing their revenue cycle processes.

While technology has revolutionized revenue cycle management in the healthcare sector, it’s AI that has leaders really excited.

One area in particular in which RCM leaders are eager to implement AI is medical coding. Coding has largely been managed by certified medical coders, but in 2023 the American Medical Association reported a 30% shortage in that position, leading healthcare executives to look to technology for help.

Detroit-based Henry Ford Health saw some success in integrating AI into their beside procedures to assist with medical coding. Bedside services are one of the system’s highest volume specialties, making up 20% of overall coding costs.

The solution automatically codes the simple procedures, referring to procedure notes that closely match ICD codes.

“It does this by bringing together all the complex information required to identify, understand, and code a bedside professional charge,” Joann Ferguson, vice president of revenue cycle, said. “It then predicts and assigns charges and diagnosis codes, automating cases directly to billing.”

The solution has also improved workflow efficiency by reducing errors, missed charges, billing backlogs, and denials. As it gets more familiar with the patient journey from the data it uses, it can also identify potential charge gaps—which can make up around 8% of previously unbilled revenue.

In addition to improving financial and operational performance, Ferguson said the solution has also helped improve coders’ job satisfaction by reducing their workload.

“We find we can get around some of the roadblocks and hesitation that come with using new technology by taking time to highlight the short-term and long-term benefits to employees’ everyday workloads, while also laying out how it helps the organization as a whole,” she explained.

Denials management

Providers spend a significant amount of time going back and forth with payers, appealing denied claims. By using AI to predict and track denial trends, RCM staff are  able to work with payers to reduce denials.

California’s Sierra View Medical Center began using an AI solution to help with its appeals process, having seen an increase in denials due to lack of medical necessity.

“Our [utilization review] department now reports to finance and will be focusing on education related to documentation to avoid medical necessity denials,” said Julie Franer, administrative director for revenue cycle.

An AI solution West Tennessee Healthcare implemented to help with patient care planning also improved its relationship with payers and reduced delays and appeals. With payers being able to connect to the platform, providers and revenue cycle staff are able to streamline patient care and insurance information.

Debbie Ashworth, executive director for care management, also noted that payer responses are timelier.

“The conversations we have with them are better [because] you’re both getting information that you can share,” she said.

Jasmyne Ray is the revenue cycle editor at HealthLeaders. 


KEY TAKEAWAYS

AI can synthesize the information needed for medical codes.

As it learns from the data its managing, AI can identify patterns like charge gaps or denial trends.

Some AI solutions are able to improve payer communication by streamlining patient care and insurance information.


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