Let us start off with the practical definition of accounts receivable. Formally, it is the average number of days that it will take a practice to collect all due payments. But what is more important is the role of this process.
The average days in accounts receivable is representative of a very valuable metric. It is reflective of the efficiency of your revenue cycle. A higher accounts receivable is indicative of a slowness in your payments.
A lower accounts receivable implies faster payment. Today, there are self – pay and high deductible health plans available. Which is why it has become even more imperative to have a lower accounts receivable.
Running a practice is extremely expensive. Physicians need to collect all their dues on time. Each penny counts. Practices should strive for an, optimal, 40 day average A/R cycle to ensure a smooth cash flow, and overall operations.
Listed below are the following tips that can help you stay within the 30 -40 accounts receivable time frame.
Verification Of Eligibility & Demographic Information Before Each Visit:
Are you ensuring you have the correct address, phone number, and email address of the patient on the file in front of you? Check out their insurance plan. Is it active? Would there be any co – payments or deductibles that would be due? If that is the case, then what is the amount?
Your patients should have this information in advance.
Take Into Consideration A Batch Eligibility System:
This system could be a game changer for your practice. This system will generate a report. Which will cover a patient’s coverage, and eligibility status. Be sure you are running this report two days prior to each patient appointment. Very early on, you would be able to catch any errors there may be in the data input.
This system will ensure updated information throughout.
Collecting Entire Co – payments At Point Of Service:
Collect this sum when the patient is checking in for their appointment. Before they visit, let them know of this expectation.
Revising Patient Statements:
Revise patient statements to be able to effectively communicate with your patients. Incorporate a detailed breakdown of all the services rendered, insurance fees, and any other due payments.
Sending Out 2 Patient Statements And Then Follow Up With A Phone Call For 90 Day Past Due Balances:
Assume you outsource to a medical billing company in Georgia. Ensure they are sending out 2 patient statements, and then following up with a phone call. Then, decide whether you want them to send the amount to collections or choose to write off the sum. More than 2 would not culminate to much. Plus, it would waste valuable time and resources.
Sending Out Bills To Insurers/Patients As Soon As Possible:
If you are elongating the time between service and date of billing, you are complicating matters. As the expression goes; out of sight, out of mind. So, ensure you are billing your patients or the insurance companies as soon as possible. Do not delay on this front. Patients will be most likely to pay at this time.
Providing Credit Card Or Online Payment Options To Patients:
This will go a long way towards patients paying you faster. Who doesn’t prefer convenience over hassle? Particularly, patients who have high deductibles or have health saving accounts would pay faster. Since they are the ones covering the majority of the bill.
Hiring Certified Coders:
There are numerous coding certifications out there. But you need to ascertain that you are hiring a qualified, as well as highly certified coder.
This person should be able to ensure an accurate assignment of ICD – 10 – CM diagnosis. Should be able to help physicians improve on documentation. Should remain up to date with all industry rules and regulations. Among serving other critical functions.
Going back to the our example of outsourcing. Suppose a company is taking care of your practice’s medical billing services in Georgia. Ensure that they have a team of trained, and skilled professionals on board.
Getting The Right Picture Of Data:
You could keep in mind some of the following tips to improve performance. For starters, calculate overall A/R days on average. Calculate days in A/R with and without accounts being sent to collections. These will definitively assist your practice.
Striving For Better:
Continually strive for improvement. Keep an eye on your data. Compare it against previous time periods, years, or quarters. You need to monitor these indicators to see where you may lack, and where there exists room for improvement.
Billing Freedom can consistently upgrade your medical billing system. A trained team of professionals can assist your practice in revenue cycle management to drastically improve your cash flow. Get in touch today!