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The Revenue Cycle

Welcome to the business side of healthcare.

The revenue cycle is the model that all healthcare businesses follow to obtain payment for services provided by the doctors and nurses the clinic or hospital employs. While you may find that many industry professionals have slightly different ideas of what the revenue cycle entails based on their personal experience, the basic steps are as follows:

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The Revenue Cycle

Step 1

Registration and insurance verification – The patient schedules an appointment and provides their health insurance policy information, which is verified as an active policy by front desk staff or a biller.

Step 2

Charge entry – Once the patient is seen by the provider, the provider will create a chart note that describes the patient’s complaint and the treatment or services offered. This note is provided to a certified coder, who will turn the note from a narrative of the visit to a standardized set of procedure codes, modifiers, and diagnosis codes.

Some clinics allow the doctor to select applicable codes from a list, which should be verified by a certified coder and appended with the appropriate modifiers before moving on to the next step.

Step 3

Claim submission – Once the correct codes are applied, a health insurance claim can be submitted to the patient’s insurance company. Most claim generation at this point (applying patient demographics and provider information) is completed automatically by the electronic billing system. A biller may complete a front-end claim review before it is submitted.

Some claims may be rejected at this point, which are also handled by a biller. If no response is received from the insurance company for a longer period of time than expected, a biller will follow up on the status of the claim.

Step 4

Remittance processing – Also known as reconciliation, this step involves posting payments received from the insurance company and applying any contractual adjustments or patient balances as described on the remit. This step is most often done by a biller. Some billing systems can even post many payments automatically!

Step 5

Denial management – Sometimes a claim will be denied for payment by the insurance company, and it’s the responsibility of a biller to work the denial to understand the reason behind it. This may involve contacting the insurance company or submitting an appeal for payment.

Step 6

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Step 6

Patient collection – This step involves collecting any remaining deductible, copay, or coinsurance from a patient, based on the remittance advice received from the insurance company.

As you can see, the revenue cycle is a vital component of any hospital or clinic that wishes to accept health insurance. Without the ability to receive payments for services provided, a healthcare facility could not possibly meet its obligations to pay for medical supplies and equipment, make payroll, or even keep the lights on. It’s up to certified medical coders and billers to use their knowledge and expertise to keep the cash flowing!

Now that we’ve gone over the basic steps of the revenue cycle and understand where coding and billing skills are put to use, let’s look at the future of the healthcare industry.

The past decade has seen incredible growth in the population of adults age 60 and older, who are expected to grow from 1 billion individuals in 2020 to 1.4 billion in 2030, and again to a staggering 2.1 billion by 2050, according to the WHO. In addition to a variety of complex health conditions, adults 65 and older are prone to falls, which alone accounts for $50 billion in healthcare spending each year¹. End-of-life care is also incredibly costly, averaging $59,000 per patient in the last 12 months of life². In order to meet the healthcare needs of older adults, the American Geriatrics Society projects a need of 30,000 additional providers by 2030.

Across all age groups, demand for comprehensive behavioral health services, which encompasses mental health as well as substance use care, has increased considerably. According to the 2022 National Survey on Drug Use and Health, 21.8% of adults 18 and older received at least some mental health treatment in the prior year. Anxiety disorders are one of the most common mental health disorders and effects an estimated 19.1% of adults 18 and older each year³. The National Alliance on Mental Health states 1 in 5 adults and 1 in 6 youths age 6-17 experience a mental health disorder each year. Projected growth in behavioral health specialists (that would reasonably expect to bill major health insurance plans, Medicare, and/or Medicaid) total over 44,000 providers by 2030, according to the National Center for Health Workforce Analysis.

Additionally, demand for primary care services continues to rise as access barriers are stripped away by expanded health insurance benefits and technological innovations such as telemedicine. Primary care office visits are expected to grow considerably between now and 2040, and the projected growth rates of non-MD providers such as NPs (Nurse Practitioners) and PAs (Physician Assistants) are 6.6% and 4.2% respectively⁴. Significant work by the U.S. government is underway to close the projected primary care gap of over 57,000 providers⁴.

The U.S. Bureau of Labor Statistics predicts much larger growth in all aspects of the healthcare industry than almost any other over the next several years. In fact, the predicted job outlook is 9% higher between 2023-2033 than average for certified coders and billers! This translates to nearly 15,000 job openings each year to accompany the rising demand in healthcare providers. You can find more information on the BLS website or through AAPC’s annual salary survey.

So, you’ve decided to obtain your credential and step into the business of healthcare. Let’s talk career paths.

No matter which credential you choose, the titles of coder or biller are only your entry point. Think of these roles as the first steppingstone on your journey to a fulfilling, financially secure career! As you gain experience, you can follow the path to senior revenue cycle roles, or perhaps you’d prefer to pivot to an adjacent role within the industry. There are so many options to choose from, there’s bound to be an ideal role out there for you!

Certified coders have an array of highly skilled specialty certifications to achieve that prove their expertise in one or more medical niche. In a few short years of your career, you could branch into a specialty such as outpatient or pediatric coding and maximize your earning potential in one of these in-demand roles. Billers also have a variety of additional certifications to include on their resumes, and as the industry expands, additional credentials may soon be on the horizon for professionals looking to get an edge over their peers.

On either career path, there are additional credentials offered to those that wish to pivot to auditing, compliance, documentation, or teaching. Many employers may even help you gain these certifications by offering to pay for all or part of your continuing education.

Like what you’ve read so far? If so, check out our courses and enroll today! And if you’re still unsure, contact us and we’d be happy to help you decide on the career path that fits you!

References

Florence CS, Bergen G, Atherly A, Burns E, Stevens J, Drake C. Medical Costs of Fatal and Nonfatal Falls in Older Adults. J Am Geriatr Soc. 2018 Apr;66(4):693-698. doi: 10.1111/jgs.15304. Epub 2018 Mar 7. PMID: 29512120; PMCID: PMC6089380.
Nardi, M. D., French, E., Jones, J. B., & McCauley, J. (2016). Medical Spending of the US Elderly. Fiscal Studies, 37(3-4), 717. https://doi.org/10.1111/j.1475-5890.2016.12106
National Academies of Sciences, Engineering, and Medicine; Health and Medicine Division; Board on Health Care Services; Committee on Strategies to Improve Access to Behavioral Health Care Services through Medicare and Medicaid; Perera U, Godwin A, Polsky D, editors. Expanding Behavioral Health Care Workforce Participation in Medicare, Medicaid, and Marketplace Plans. Washington (DC): National Academies Press (US); 2024 Oct 7. 2, Behavioral Health Needs in the United States. Available from: https://www.ncbi.nlm.nih.gov/books/NBK609444/
Bazemore, A.W., Petterson, S.M. & McCulloch, K.K. US Primary Care Workforce Growth: A Decade of Limited Progress, and Projected Needs Through 2040. J GEN INTERN MED 40, 339–346 (2025). https://doi.org/10.1007/s11606-024-09121-x

Revenue Cycle Industry

What is the revenue cycle and why is it important to the business side of healthcare?

Our page on the revenue cycle has tons of information to help you learn about the importance of the business side of healthcare!

Once I have my credential, what career path is available to me?

No matter which credential you choose, the titles of medical coder or medical biller are only your entry point to the wider industry of the healthcare business. Think of these roles as the first steppingstone on your journey to a fulfilling, financially secure career.

Certified coders have an array of high-level specialty certifications to achieve. In a few short years of your career, you can branch into a wide variety of medical specialties such as outpatient or pediatric coding. You can also choose to become an auditor, compliance or documentation specialist, or instructor.

Certified billers also have a variety of additional certifications to include on their resumes. Besides joining a management track, you can choose to branch into auditing, compliance, documentation, practice management, and more.

What do job prospects look like for certified coders and billers?

The past decade has seen incredible growth in the population of seniors requiring complex medical care, greater numbers than ever of people seeking comprehensive mental health services, and more demand for primary care services. As new physicians, nurses, therapists, and other healthcare specialists join the industry to meet this growing demand, so too do new opportunities for certified coders and billers. No healthcare system can function without their expertise.

The U.S. Bureau of Labor Statistics predicts much larger growth in the healthcare industry than almost any other over the next several years. In fact, the predicted job outlook is 9% higher between 2023-2033 than average for certified coders and billers! This translates to nearly 15,000 job openings each year. You can find more information on the BLS website or through AAPC’s annual salary survey.

Is it hard to find a job as a newly certified coder or biller?

While it can be a challenge to break into any industry, certified coders and billers provide vital revenue cycle services to a variety of healthcare businesses. Due to their educational training and the industry-leading recognition of quality that the AAPC credential provides, newly certified individuals can land their first role with greater ease.

Pro Tip! The AAPC membership included with every training course allows you to access their career resources and monthly chapter meetings, which can be great for networking with employers in your area!

Won’t AI take over medical coding and billing jobs?

While AI is rapidly developing into a powerful tool in the healthcare industry and beyond, most aspects of the revenue cycle require the thoughtfulness and experience of a human being. Though these roles may evolve over the next decade due to AI, the revenue cycle career path is very unlikely to disappear entirely.

Another thing to consider is that the skills you can learn today can lead you further along the career path to roles that are further insulated from the reach of AI, such as auditing, practice management, EHR (electronic health record) analysis, and compliance management.