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Revenue Capture Is Critical to Achieving a Profitable Bottom Line – Hospital and Medical Practices


Healthcare spending is predicted to increase to nearly 21% of the US economy by 2021. For healthcare providers this means greater demand for services but doesn’t guarantee increased payments. While patient volume may increase, per unit payment structures will likely decrease. In fact, payers have leveraged technology to make it more difficult for providers to get paid. Viability in today’s market requires a well-managed, proactive revenue cycle.


Charge capture and charge reconciliation are vital processes for revenue management. Many successful organizations have put charge capture teams in place to monitor the process of charge capture and reconciliation. These teams provide the revenue producing departments with feedback and training to enhance an atmosphere of organization-wide accountability. High performing hospitals develop clear policies and procedures for all staff and provide training to ensure that the charge capture team understands their role in the revenue cycle. They do this by providing timely and meaningful feedback and making staff at all levels accountable for performance. Common reasons for charge capture problems:

  • Lack of sufficient training – Do all team members understand and follow the policy?
  • System Limitations – Are all orders up to date? Do charge capture tools support timely entry and reconciliation?
  • Computerized Physician Order Entry – Who is responsible?
  • Unmonitored Daily Department Revenue Reports – Is there a daily dashboard that monitors revenue by department? Is there clear accountability?

Since every charge is potential cash, organizations need to understand the common factors resulting in lost charges. The CDM should be reviewed for:

  • Consistent / Accurate / Optimal Pricing
  • Inactive / Obsolete Charge Codes
  • Use of Miscellaneous Charges – Pricing Overrides?
  • Revenue Codes / HCPCS-CPT4 codes – Up to date and compatible?

Your organization needs to prepare now for diminishing revenue streams. Well-functioning charge capture processes and disciplined accountability will help your organization weather the storm.

KOHLER HealthCare Consulting, Inc. (KHC) has been a leader in Revenue Cycle for over 30 years.


The Healthcare Financial Management Association (HFMA) defines revenue cycle as "All administrative and clinical functions that contribute to the capture, management, and collection of patient service revenue." Simply, it is the entire life of a patient account from registration to final disposition (zero balance). Revenue cycle functions while interdependent, are performed independently; thus, each individual process must be performed timely and accurately to achieve predictability and profitability. The process of accurate charge capture and daily reconciliation is vital to a successful, well-managed revenue cycle which ultimately translates to the organization’s bottom line.


Revenue Cycle national best practice guidelines for healthcare providers, most specifically hospitals, for charge capture processes and revenue maximization can be achieved by the implementation of a centralized team of individuals who manage revenue and revenue integrity. This team supports resolution of operational issues, supports charge activity function, and monitors daily revenue for trends. They are in place to support individual departments. Specific responsibilities typically include:

  • Monitoring of late charges and daily department revenue
  • Charge auditing and process improvement
  • Denial Management reporting and remediation activities
  • New service line evaluation
  • Clinical charge capture oversight and training
  • Leadership of a Revenue Cycle Steering Committee


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