If you really want your practice to grow and make profit, then there are two important areas you need to work on- A/R and denial management. Without an effective strategy for denial and accounts receivable management, you will be losing a lot of revenue.
- According to a study by a 2014 Advisory Board, around 90% of claim denials are preventable.
It is very important that you are watching out for A/R aging because delayed collections and aging bills are extremely difficult to get reimbursed. Your staff will have to spend a lot of time and money for each follow-up round which means increased operational burden and high resource cost. If not attended to, there will be a pile of unpaid bills at the end of a fiscal year and you will suffer huge losses.
As insurance companies are increasingly using sophisticated technology to detect faults in claims, it has become necessary for practices to have a strategy for denial management.
How to deal with denials and A/R aging?
It is necessary that you are making A/R aging report a priority. You need to have dedicated team members for monitoring claims and ensuring that the insurance company has received the claims. If a claim has populated on the 30-days aging report, then your staff needs to start the follow-up process immediately.
Similarly, your practice needs to be having dedicated staff for denial management. They will be communicating with insurance representatives, researching denials and fixing issues before the resubmission of claims. Only when the staff is well-trained and experienced, he/she will be able to identify the reasons why claims were denied, create a workflow for denied claims and also navigate through the complexities of the insurance system.
Claim denials and A/R aging can prove to be two major speed bumps in the growth of your practice. So make sure you have experts to handle them. Many practices choose to outsource this task to a third party. They hire companies specializing in revenue cycle services along with denial management.
The whole idea is to make sure that the claims are not rolling past 30 days. So if you feel that your A/R is out of control and you need help with denials, and then don’t hesitate in hiring a third party for assistance.