Keeping your Accounts Receivable, A/R, in check is absolutely key to running a successful practice. Letting outstanding balances get out of control is equal to throwing money away. Developing a system for addressing balances and making it a mandatory part of your office management routine will ensure no revenue slips through the cracks.
A/R can consist of both insurance balances, i.e. unpaid claims, as well as patient balances.
To manage your patient A/R effectively, you must understand eligibility and benefits, and you must be ready to enforce a strict collection policy and collect balances up front.
This begins with the basic knowledge that if the patient doesn’t have coverage, the claim isn’t going to get paid by the insurance company. So make verifying benefits and eligibility a priority before the patient walks through the door. This will avoid unnecessary denials and wasted time. Know which services will be covered and which won’t and discuss with the patient to be clear about their coverage. They may opt to receive a non-covered service and pay out of pocket. Also, be ready to explain to the patient what their financial responsibility will be for the services they are going to receive prior to the service being rendered. This means no surprises for the patient and less time spent chasing copays and co-insurance after the visit. Enforce a strict collection office policy and have a sign posted stating that all balances are collected at the time of service. Regular patients will become used to this policy and will arrive ready to pay. Also, have a collection plan formulated and address all patient balances in a timely manner. This includes sending statements on a regular basis and tracking outstanding balances, and even making phone calls to patients who are delinquent. It is a common practice to employ a collection agency to pursue balances that remain outstanding. And finally, know when to let a balance go. Time is money, and if you are spending more time than it is worth on an unpaid balance, it may be more cost effective to write it off and direct valuable time to balances that are more likely to be paid.
Managing insurance A/R effectively starts with understanding the billing process as a whole, and the revenue cycle of the claim.
The most important step in medical billing is ensuring accuracy. Assign CPT and ICD codes accurately and be sure medical documentation supports both. Inform yourself regarding what codes are covered by each insurance to avoid submitting non-payable services that would be written off anyway. Be sure all patient information included on the claim is accurate and complete to avoid denials for invalid or missing information. Secondly, submit your claim immediately. Once documentation is complete and the proper codes are assigned, get the claim out to the payer without delay. This will avoid dealing with timely filing issues, which could result in an unnecessary need to write off a balance that could have been paid. Thirdly, address denials in a timely manner. If you do not understand the reason for denial, call the payer to clarify. If an appeal is necessary, do not delay in submitting it as there may be a time limit. Include all documentation and any additional information that may be needed to ensure payment.
Lastly, track balances closely and run an A/R Aging report on a regular basis so nothing slips through the cracks, and balances don’t build up and become overwhelming. These reports can be filtered by patient balances or insurance balances. Address the oldest first and know when to write an unpayable balance off.
When managing your Accounts Receivable, organization is your biggest ally. Track claims and patients balances with diligence and develop policies and procedures and make them part of your office routine to ensure any issues are addressed regularly and without delay. Time is of the essence in medical billing, so stay on top of your A/R and keep that revenue flowing.