Healthcare is, and should always be, primarily about health. But the inescapable truth is that all medical services cost money. This obvious fact has led to the development of a robust IT infrastructure that manages the healthcare revenue cycle — from handling insurance claims to collecting payments. The whole process is a sequence of numerous tightly interdependent steps. Its complexity leaves room for optimization and very little room for error.
Smooth Revenue Cycle Management (RCM) is critical for effective healthcare and reducing revenue leakage, but surprisingly few industry leaders perceive its importance. For example, a 2020 report showed that 87% of providers still used manual and paper-based processes for collections. The consequences? 78% claimed they failed to collect payments over $1000 within 30 days. Add fluctuations in healthcare spending, and you have a recipe for an unstable and inefficient system from the perspective of patients and providers alike.
Even though the pandemic has undoubtedly increased the level of digitization in healthcare organizations, many still rely on manual revenue management operations. Luckily, solutions exist that can be easily adopted and don’t require a massive investment in complex IT infrastructure setup or maintenance. This article explores some of them, discussing RCM systems for medical services and suggesting how your medical organization can benefit from Revenue Cycle Management automation.
Learn more about using Robotic Process Automation in other industries, like insurance, logistics, or consultancy.
Revenue Cycle Management in healthcare & medical billing
Revenue cycle management refers to all the administrative tasks devoted to financial transactions between patients and their providers and how they are handled. The key processes in RCM are:
Pre-authorization — the process starts when a patient makes an appointment. To set up a patient account, the provider must gather and register all the necessary data, such as personal information and medical records, and assess the patient’s insurance eligibility.
Medical coding — next, medical data like test results, diagnoses, or procedures are translated into a unified code. This standardized system facilitates communication between physicians, office staff, insurance companies, and other healthcare providers involved in treatment.
Claims submission — a coded record of the patient’s treatment is submitted to the insurer, who then reviews and approves or denies the claim.
Payment collection — if the insurer approves the claim, the provider receives reimbursement. The amount depends on the patient’s eligibility, as insurance doesn’t always cover the full cost. If not, the provider must follow up with the patient and collect the remaining balance.
Service review and reporting — once the payment is complete, the data used in the revenue cycle and clinical treatment is analyzed. This ensures insight into potential issues and ways to improve the entire process.
At this stage, it’s important to note that although the term revenue cycle management is often used interchangeably with medical billing, the two are not the same.
RCM encompasses all the processes mentioned above, while medical billing refers only to those directly related to claims — coding, submission, and payment collection. In that sense, RCM is a broader, end-to-end workflow that includes billing as one of its components.
The revenue cycle is affected by many unpredictable, shifting factors — both internal and external. These moving parts often complicate revenue cycle management, making many cases unique.
Revenue Cycle Management systems — what they are and how they help
Revenue Cycle Management software aims to digitize and replace paper-based procedures and documentation within revenue cycle workflows. Think of it as the EHR of medical billing and claim management.
According to a 2026 forecast, the RCM software market is expected to grow by 10% annually between 2023 and 2030. This and other research confirm that demand for RCM solutions is rising — and for good reason.
RCM systems support back-office staff in essential tasks such as:
- checking eligibility
- claim correction and tracking
- KPI reporting
- data entry
- medical coding
- denial management and alerts
- contacting patients and insurers
- cost estimation
…and more. They achieve this by leveraging modern technologies, including RCM automation.
Choosing the right RCM automation tool
Many RCM processes — especially medical billing — can be optimized using intelligent software. In some cases, algorithms can fully take over simpler tasks. Here are the most common technologies used in RCM automation:
Intelligent Automation (IA)
IA combines multiple technologies — such as AI, OCR, NLP, and RPA — into a unified system. It enables end-to-end automation, where systems not only execute tasks but also learn and optimize processes over time.
Robotic Process Automation (RPA)
RPA uses pre-programmed scripts to handle repetitive, rule-based, high-volume tasks. Many stages in the healthcare revenue cycle are ideal for RPA, including scheduling, claims tracking, invoice processing, and billing operations.
Machine Learning (ML)
ML algorithms analyze large datasets to improve decision-making. In RCM, they can identify claims likely to be denied before submission and recommend corrections. They can also help predict patient outcomes and financial risk.
Optical Character Recognition (OCR)
OCR scans documents and images to extract text and convert it into a digital format. In healthcare, it accelerates data entry across prescriptions, medical records, and billing workflows.
Natural Language Processing (NLP)
NLP extracts key information from unstructured data, such as physician notes. It allows staff to work with complex data more efficiently without sacrificing billing accuracy.
The benefits of RPA in Revenue Cycle Management
While different automation technologies vary in complexity, RPA typically requires the least effort to implement and delivers relatively fast ROI. That said, implementation is not always straightforward. A recent survey by Becker’s Hospital Review found that although 51% of providers use some form of RPA, only 7% consider their adoption mature, and 33% describe it as robust.
Still, with the right automation partner, RPA is a strong first step toward broader automation. This is because RCM processes are:
Repetitive — tasks like sending invoices, verifying data, and checking compliance are ideal for automation.
Stage-based — the revenue cycle consists of multiple structured steps that can be partially or fully automated.
Error-prone — automation reduces human error and improves consistency.
Costly — inefficiencies in RCM cost the U.S. healthcare system billions annually, many of which can be reduced through automation.
How to use RPA in Revenue Cycle Management
RPA enables multiple improvements across the revenue cycle:
- Faster cost estimates through automated benefits retrieval
- Pre-authorization support by pulling and transferring patient data across systems
- Improved patient communication via automated scheduling and reminders
- Automated data entry, reducing errors and denials
- Better compliance with regulations like HIPAA
- Streamlined handling of orders and referrals
- Automated management of simple claim denials
- Seamless integration between third-party systems
- Enhanced patient experience through faster and more accurate processes
Conclusion
With constant regulatory changes, cost fluctuations, and unforeseen challenges like COVID-19, delivering high-quality medical services is not possible without a stable financial infrastructure.
Healthcare leaders are increasingly adopting automation to ensure efficient and secure revenue cycle management. If you’re looking for a partner to automate your RCM systems, Flobotics brings hands-on experience and an ROI-first approach — helping clients reduce costs, improve efficiency, and maximize revenue.
.jpg)
