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 developing 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 will explore 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 RPA in insurance, RPA in logistics, or automation for 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 info 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 various healthcare providers involved in the treatment.

Claims submission — a coded record of the patient’s treatment is submitted to their insurer, who then reviews and approves or denies the claim.

Payment collection — if the insurer reviews the claim positively, the provider receives reimbursement. The amount depends on the patient’s eligibility, as insurance doesn’t always cover the amount due. If so, the provider must follow up with the patient and collect the rest of the payment.

Service review and reporting — once the payment is complete, the data used in the revenue cycle and clinical treatment is analyzed. This process ensures insight into possible issues and methods of overcoming them to streamline the entire process.

At this stage, it’s important to note that even though the term revenue cycle management is often used interchangeably with medical billing, the two aren’t synonymous.

Revenue Cycle Management in healthcare & medical billing

RCM encompasses all the processes mentioned above, while medical billing refers only to those concerned directly with claims, i.e., coding, submission, and payment collection. In that view, RCM is a broader, end-to-end workflow that includes billing as an important part.

The revenue cycle is affected by many unpredictable, shifting factors that can be internal or external. These moving parts often complicate revenue cycle management, making many cases wholly unique.

External & internal factors that effect revenue Cycle Management

Revenue Cycle Management systems — what they are and how they can help?

Revenue Cycle Management software aims to digitize and replace paper-based procedures and documentation in the revenue cycle workflows. Think of it as the EHR of medical billing and claim management.

According to a 2021 forecast, the Revenue Cycle Management software industry is expected to grow by 10% annually through 2021 and 2025. This and other research prove that the demand for RCM solutions is rising. And for a good reason.

Revenue Cycle Management systems assist the back-office staff in many essential tasks within the revenue cycle management, 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 all that by leveraging innovative technologies — including Revenue Cycle Management automation.

Automate processes in healthcare

Choosing the right RCM automation tool

Many RCM processes—medical billing in particular—can be optimized with the help of intelligent software. What’s more, algorithms can entirely take over the execution of some simpler tasks. Here are the most popular solutions used for revenue cycle management automation.

Robotic Process Automation

The name says it all— Robotic Process Automation (RPA) systems use pre-programmed scripts to handle repetitive, rule-based, high-volume tasks.

Many stages in the healthcare revenue cycle are the perfect fit for RPA: scheduling, claims tracking, invoice processing, and most medical billing functions.

Read more about medical coding automation to know how RPA can help and the RPA development process.

Machine Learning

Machine learning (ML) algorithms thrive on large amounts of data that hospitals, clinics, doctor’s facilities, and medical research centers can use to boost decision-making capabilities.

In RCM, machine learning can help recognize claims likely to be denied before they are submitted and recommend corrections. Another example is predicting patient outcomes to help providers make informed decisions when handling risk-based cases.

Optical Character Recognition

Optical character recognition (OCR) is a technology that scans documents and images to extract text and convert it into a digital format. OCR programs are commonly used in healthcare to quickly fill prescriptions, medical records, or other documentation.

Faster data entry allows for massive time savings in many RCM-related tasks, such as pre-registration, claims submission, or coding.

Natural Language Processing

Like OCR, natural language processing (NLP) enables faster data extraction. However, rather than scanning the entire text, NLP-based tools focus on identifying key terms in unstructured data, such as doctor’s notes.

Unstructured data is great when dealing with complex, unique cases, but it usually takes longer. Capable of capturing more sophisticated texts, NLP allows medical staff to communicate naturally without compromising billing and coding efficiency.

Intelligent Automation

Last but not least, intelligent automation (IA) is the ultimate combination of other automation solutions. They are deployed as a single high-synergy system that is efficient, smart, self-learning, and can deal with any data.

When used in RCM, IA combines the best of all worlds. For example, AI can go through patient data extracted and formatted by OCR/NLP in search of repeating patterns. The AI then identifies standard procedures that can be delegated to efficient, pre-programmed RPA bots.

The benefits of RPA in Revenue Cycle Management

While the above solutions find use in revenue cycle management automation, they vary in deployment complexity and day-to-day operations. RPA usually requires the least effort and investment of all five while promising relatively fast ROI.

That’s not to say that RPA implementation is easy. On the contrary, a recent survey by Becker’s Hospital Review reveals that although 51% of providers incorporate some form of RPA in their systems, just 7% would classify the adoption as “mature” and 33% as “robust.”

Still, when you are supported by a trusted team of automation experts, deploying the robotic process automation revenue cycle is a great first step toward further automating your financial operations. That’s because revenue cycle management, by its nature, is:

1. Repetitive — sending invoices, receipts, payment reminders, verifying patient data, and checking regulation compliance — are some tedious daily billing operations that RPA bots excel at.

2. Stage-based — as a whole, the revenue cycle is complex but consists of numerous simpler steps. Many of these stages can be managed by bots, allowing your staff to focus on other, more demanding tasks.

3. Prone to error — since scripts don’t get tired and don’t lose focus, they’re less likely to make typos or leave form fields unfilled. They can assist human billers in complicated cases, suggesting corrections and insights.

4. Costly — MGMA estimates that 2020 the US healthcare industry lost over $16 billion due to revenue cycle inefficiencies. Many of them could have been resolved with automated revenue cycle management.

How to use RPA in Revenue Cycle Management?

Using RPA opens up new opportunities to optimize the processes within the revenue cycle. Here are some of them:

Faster cost estimates — automating the benefits retrieval process will expedite cost estimate turnover.

Pre-authorization assistance — RPA bots pull patient data from other systems and upload them directly into your Hospital Information System (HIS), reducing delays.

Enhanced patient communication — RPA will automatically schedule meetings and send patients reminders or recaps of the information shared on a phone call.

Automated data entry — RPA can integrate the data from various sources into your system faster and more precisely, preventing simple errors and resulting denials.

Compliance — by reducing manual processes, RPA helps providers avoid errors and assure compliance with HIPAA and other regulations.

Handling orders and referrals — manually reviewing referrals and orders creates further delays in the revenue cycle. In contrast, RPA handles order scheduling and confirmation, enabling a smoother RCM.

Claim denials management — simple cases of claim denials can be handled entirely by RPA bots while your staff works on the more complicated ones.

RPA for claims processing is also a great decision that will boost your company’s productivity

Third-party integrations — efficient RCM often requires multiple tools from different providers. RPA ensures that all of them work together seamlessly.

Improved patient experience — RPA revenue cycle ensures faster claim processing, improved communication, and higher efficiency, encouraging patients to choose you over other healthcare providers.

Discover SAP Automation with UiPath and Flobotics.


With constant regulation changes, cost fluctuations, and unforeseeable challenges like COVID-19, delivering high-quality medical services isn’t possible without a stable financial infrastructure. For this reason, healthcare leaders are adopting automated solutions that allow for efficient and secure revenue cycle management.

Suppose you’re looking for a trusted partner to automate your organization’s RCM systems; contact us at Flobotics. We have vast experience working with medical companies and believe in the ROI-first approach — we always consider the costs and potential gains to help our clients save and earn as much as possible.

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Bart Teodorczuk

Bart Teodorczuk

RPA Tech Lead at Flobotics. Automation consultant expert for the healthcare and finance industry.