Healthcare revenue cycle management (RCM) refers to the process of handling billing, payment processing, and revenue collection in healthcare practices. RCM comprises front-end processes such as patient appointment scheduling, insurance eligibility verification and authorization, upfront collections, and back-end processes such as payment posting, accounts receivable, and denials management. Professional medical billing companies provide comprehensive accounts receivable management services ranging from charge capture to payer/insurance follow-up, accounts receivable analysis, and ongoing monitoring and reporting of receivables risk exposure.
According to a report from Global Market Insights, the healthcare revenue cycle management market size that exceeded USD 98.3 billion in 2020 is expected to reach USD 230.3 Billion by the year 2027. The market is anticipated to grow at a CAGR of over 12.9% from 2021 to 2027.
Key factors that are expected to drive the market growth are:
- Growing demand for health insurance in countries like the U.S.
- Increasing optimization of healthcare revenue cycle management
- The surge in technological advancements
- Growing demand for health insurance in North America
- High preference for big data analytics
- Technological advancements in HRCM solutions
- Increasing healthcare expenditure in developed and developing economies
However, factors such as frequent changes in healthcare regulatory compliance and lack of trained professionals are among the pitfalls and challenges related to market growth.
How Big Data Analytics Helps Healthcare Revenue Cycle Management
High preference for big data analytics and its integration in the healthcare revenue cycle management process is expected to create more growth opportunities. Ranging from genomic testing to large imaging studies or any payment transactions, big data analytics can handle exploding amounts of medical data, worldwide. Hospitals in developed countries are using big data analysis and AI applications in the areas of coding and billing, denial prediction, and insurance pre-certifications.
The utilization of big data analytics software helps healthcare practices to
- store a large amount of data
- reduce operational costs
- increase the efficiency of services provided to patients
- benefit from efficient data processing and analysis
By managing vast amounts of data using big data analytics and machine learning, many healthcare providers have improved productivity in their revenue cycle management process.
The report divides the market on the basis of Product, Function, Deployment, and End-use.
By product, the market is divided into Integrated and Standalone segments. The Integrated segment accounted for USD 79.7 billion in 2020. Rising demand for integrated systems is predicted to promote the healthcare revenue cycle management market progression. Large healthcare service providers prefer integrated systems to process large databases.
These end-to-end systems can
- combine front and back-office data flows
- provide easy access to clinical data from electronic health records, and
- streamline the complete healthcare revenue cycle management process
The rising interest of customers in integrated healthcare revenue cycle management solutions comprising patient appointment scheduling, medical billing, and electronic health records applications is expected to drive the segment growth during the forecast timeframe.
By function, the market is segmented into Claims & Denial Management, Medical Coding & Billing, Insurance Eligibility Verification, Payment Remittance, and Others. Growing demand for claims & denial management programs is expected to accelerate the industry expansion.
With the increasing awareness among people residing in developed countries regarding available reimbursement scenario, the claims & denial management segment held around 28.5% of revenue share in 2020. Rising interest in reimbursement policies will increase the demand for claim and denial management systems, thus augmenting the industry progression during the forecast period.
On the basis of deployment, the market includes On-premise and Cloud-based solutions. Increasing preference for cloud-based solutions is expected to push the market demand. The cloud-based segment in the market reached more than USD 74.7 billion in 2020. Being a cost-effective option, cloud-based systems are of relatively high preference as compared to on-premise software systems. Cloud-based solutions ensure ease of operations and provide timely updates for a better user experience.
End users of the Healthcare RCM market are Hospitals, Physician Offices, Diagnostic Labs & Ambulatory Surgical Centers, and Others. The Hospital segment accounted for 37% of the market share in 2020. High acceptance of healthcare revenue cycle management software in hospitals to optimize revenue by enhancing management of coding, accounts receivable, claims processing, self-pay collections and insurance follow-ups is further predicted to motivate the segment expansion. The use of HRCM software helps hospitals with increasing cash flow that helps them in achieving sustainable financial performance.
Geographically, the market is divided into North America (U.S., Canada), Europe (UK, Germany, France, Italy, Spain, Russia), Asia Pacific (Japan, China, India, South Korea, Australia), Latin America (Brazil, Mexico, Argentina), Middle East & Africa (Saudi Arabia, UAE, South Africa). Rising healthcare expenditure in North America will drive the market growth. Owing to the notable changes in regulations that have positively influenced the organization, finances, and delivery of healthcare services, this region has dominated the market and captured over 47% of revenue share in 2020. The increasing number of hospitalizations is predicted to increase the need for healthcare revenue cycle management solutions, thereby driving the regional growth. Also, the growing prevalence of chronic diseases such as diabetes, cancer, and others contribute to the increased demand for healthcare services and subsequent increase in healthcare expenditure.
Some of the key players operating in the market are Accretive Health (R1 RCM), AGS Health Inc., AllScripts, Athenahealth CareCloud Corporation, Cerner Corporation, Conifer Health Solutions, Change Healthcare (Emdeon), Experian Information solutions, Inc., Gebbs Healthcare Solutions, McKesson Corporation, Optum (The Advisory Board Company), and SSI group among others. These companies are implementing various growth strategies to maintain competition and secure a prominent position in the market.
Meghann Drella possesses a profound understanding of ICD-10-CM and CPT requirements and procedures, actively participating in continuing education to stay abreast of any industry changes.