If your practice has the right tools and trained staff, then benchmarking accounts receivable objectives won’t be a challenge. You need to have multi-dimensional approach to A/R management as it will help you in maximizing collections and leave less dollars on the table.
As part of the A/R plan, you need to start prioritizing claim denials, watch out for red flags that indicate A/R issues and also start monitoring A/R statistics.
- When it comes to prioritizing denials, it is important to ensure that your staff includes front-desk staff; practitioner and the billing professionals understand their role in the revenue cycle This will help in keeping accounts receivable under control. There needs to be a cycle in which, if a claim gets denied, it will have to be matched up to certain steps in the revenue cycle. If there is a step that shows there is a problem, then certain processes will have to be revamped to prevent problems in future. So the most important thing to include in the A/R plan is the prevention of denials. With every visit, patients need to be asked if their insurance plans have changed so that time isn’t wasted in billing the wrong insurance company.
- Second very important thing to include in the A/R management plan is monitoring of the A/R days on a regular basis. This is because accounts receivable is one of the most important signs of your practice’s financial health. A good place to start the monitoring process is by finding out which of the A/R accounts are over 120 days old. For the average medical practice, 17.7% is the average benchmark (according to the Medical Group Management Association). So if you have accounts remaining in A/R for a long time, then it is time to figure out the reason and take necessary actions.
- Reporting on daily aging of receivables is equally important if you want to ensure faster collections. When payments get collected quicker, there are less or no chances of claims getting lost or forgotten. It is also necessary to have an A/R system in place that will be calculating A/R aging based on the date of service and not on the date the insurance has been billed. Also, get staff that will stay abreast with the latest trends.