Creating a smooth billing process for your medical practice saves time and boosts revenue. By contrast, if practices do not manage their accounts receivable (AR) well, they will find their revenues dropping.
This drop can easily lead to a quality spiral, where poor cash flow leads to poor care and vice versa. Practices that adopt modern technology, streamline workflows, and have consistent standards may avoid this mishap.
Here is the best process for managing accounts receivable.
A functional billing team must complete regular reports for review. These documents help the team understand why the revenue cycle is in its current state. Data is crucial to construct an improvement plan based on what has worked.
Here are a few items that are most helpful to track.
- Cost to Collect Patient Revenue: Measure how much you have to spend to collect a dollar of revenue. Cash as a Percent of Net Patient Services: Recording this percentage measures how your practice translates services into revenue from patients.
- Claim Denial Reason: Section denials by reason to learn what errors are most common.
- Claim Denial Rate: Separate insurance payers to determine which ones have requirements that clash with your process.
- Days in Accounts Receivable: This metric helps get a picture of the AR split by Insurance and Patients. Ideally, days in AR should stay below 40.
Payers deny claims an average of 5%-10%. The most common reasons for denials include the patient not being covered under the plan, missed deadlines (TFL), duplicate claims, and inaccurate or missing information. Most of these denials are fixable with a rework and resubmission. However, these resubmissions can cost thousands of dollars, so guide your team with SOPs to avoid errors.
After scheduling a patient:
Once the patient arrives, have them verify their personal information. Technologically savvy providers can have patients do this online before arriving.
For a report to be successful, a team member must review and create a workflow plan. With an accurate, well-organized report, a competent planner can map out a clear path of improvement. A solid first step towards improvement is consistently setting up patients with financial technology (fintech). These systems maximize collections by helping patients pay their bills quickly.
Ensure that your team knows the report-making and reviewing process. Reinforce how to avoid claim denials and how to resubmit. Review your records when a denial arrives. Go through your patient information to ensure that it is accurate. And correct any discrepancies you find any.
Do this same process for insurance codes to ensure compliance. Assign different team members to a subset of payers. If your denial rate is higher than 10%, consider hiring a professional billing service to help your practice recover.
Modern technology excels at boosting efficiency and reducing work hours. And health services that don't keep up with this modern technology risk the chance of becoming outdated. A common reason for practices failing to follow up on denied claims is lack of time or staff bandwidth. Thankfully, medical systems can automatically pre-verify authorization, creating more time for staff.
Advanced EHR systems will also notify staff to review critical information for an insurance claim. Ensure that your personnel understands this system to maximize utility.
A professional company can immediately improve AR quality if your team is consistently challenged to meet its AR standards. Plutus Health makes managing the modern revenue cycle landscape easier for your practice. If you are struggling with billing, collections, and management, our expert team will get the fastest reimbursement possible and increase your practice's performance.
1. Create and review regular reports that provide trends.
2. Review insurance codes and patient information to correct any discrepancies.
3. Manage your team's workflow to ensure maximum efficiency.
4. Use up-to-date technology to stay abreast with modern advancements.
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