Analyzing Account Receivables
Your office runs well, as long as people pay for the services they receive. However, bad debts to doctors can cost into the thousands. Often, you are working understaffed and don’t have the time to sort through these issues. These account receivables can be difficult to collect, and near impossible after 120 days. Your office can reduce its accounts receivable by engaging in analysis of the reasons for claim denials, the reasons claims take longer to be paid, and other factors. Once you have this information, you can come up with a strategy to reduce your receivables and, thus, increase your cash flow.
Analyze Your Data
First, analyze why it is that your ARS is pending for a long time. Could it be because the patient is ineligible? Are adjudication issues taking up too much time? Are you sending in the right documents on the first time, or is there a delay because you have to follow up because the claims were not submitted properly the first time? Are you staying within appropriate time limits? Analyzing data is so important for learning where things are going wrong. You can use the answers to these questions to determine where there are holes and how to fix them.
- If you don’t look at the data, you’re missing out on opportunities to improve workflow and your profits.
Fix the Errors in the Billing System
Once you’ve figured this out, you’re then going to have to address what in your billing system is causing these problems. What are the quickest and most effective corrective measures you can take to reduce your accounts receivable? Is there automation that can be done to make the process faster? Implementing new processes can make a major difference in the workload of your employees but also in your ability to obtain and review relevant information quickly.
- Perhaps learning about a problem opens your eyes to a common error that can be fixed from then on out. Over time, this can result in a substantial cost savings.
Maintain a Relationship
Make sure that you have a good relationship with the insurance carrier. Understanding the process, and having someone who you can talk to when there is a problem, can make all the difference. Additionally, making sure that you keep good records when claims are denied – and of the reasons that claims are denied – so that you can refer back if the same issue arises in the future.
Make sure that you have an individual in your office who understands the claims process inside and out – and the differences between each provider. This person should be able to deal easily with the insurance company’s representative, and professionally in handling your appeals.
- Make sure that you have a system to track the time limits on various claims. If you don’t, you may be losing money.
Analyzing what the holes are in your accounts receivable system will save you time and money, and lead to smoother operations. Can you really afford to wait?