How to keep your Practice’s Accounts Receivable on Track

How to keep your Practice’s Accounts Receivable on TrackBased on the credible estimates by Medical Group Management Association (MGMA), practitioners fail to collect as much as 25% of their accounts receivables  on an average, owing to a host of reasons, particularly the various complicated rules of the Insurance Companies. The rules that have turned complicated with time often lead to high risk of denials, incomplete payments and lost or ignored claims. It is also estimated that not less than $125 billion is unclaimed by provider’s offices every year owing to poor AR management at their end.  Not to mention, the loss of revenue thus is quite unnecessary and avoidable, since there are many smarter ways to ensure that your account receivables remain on track.

1. Follow ‘Payer Schedule’ Model

Account Receivables are placed into different buckets based on their aging, like 30/ 60/ 90 days. These buckets imply the respective timelines to take appropriate follow-up action. Each payer has their own payment schedule and a pre-defined interval to process the claims. To illustrate, say insurance company ‘A’ may process payment of a bill in 14 days whereas another insurance company ‘B’ may take 40 days to process the same bill. In other words, if a practitioner chases all dues after flat 30 days, it will be too late for company ‘A’ and way early for company ‘B’. To conclude, follow schedules as provided by the insurance companies to reduce your  AR days and see the payment reflecting.

2. Online Claim Submission & E-Documentation

As per American Medical Association, physicians having electronic claims processing reduce their submission cost from 14% of revenue to roughly 1%. Besides, aggressive online claim status tracking and  obtaining remittance advice electronically also helps the provider’s office maximize collections in minimal days.

3. Track and Standardized Denials

Analyzing the denial causes could also help the provider’s office optimize the account receivables in an economical manner. Each denial may be categorized based on its types – such as enrollment, medical necessity, justification, coverage, authorization and the likes. This allows the physician’s office to understand the causes of denials and act accordingly to minimize the denials.

4. Target 100% First Yield Pass

The Centers for Medicare and Medicaid Services (CMS) estimated that only 70% of claims are paid in the first go of their submission. Moreover, medical practitioners do not re-submit 18% of their unpaid dues. The best remedy is to take effective pre-emptive measures like identifying the potential denials and ensure clean claims submission. An efficient AR management system in place would help the provider’s office accomplish this.

5. Benchmark against Industry standards

The American Medical Association website shares information about payment timelines of different insurance companies. The provider’s office could use this information to gauge its payment timelines for various bills. If the bills are not paid within respective timelines, it could be because of two reasons – either the claims submitted have not been clean or the follow-up procedure for unpaid claims has been insufficient. On the other hand, having a reliable AR management system would not only ensure clean claims submission, but also rigorous continuous follow-ups and optimum revenue generation hence. is renowned for its state-of-the-art and world-class AR Management that handles the management of accounts receivables efficiently and takes “the right action at the right time”.