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Reducing AR Days in Healthcare

Streamlined revenue cycle operations ensure the financial stability and growth of your practice. When the healthcare revenue cycle is not managed well, collection efficiency drops, and accounts receivable (AR) days increase. Accounts receivable is at the heart of revenue cycle management, as you get paid faster which results in healthier operations. Streamlining the healthcare revenue cycle involves ensuring collection efficiency and monitoring AR days. With a well-managed revenue cycle, revenue comes in faster, with less effort. Everyone has a role, from physicians, nurses, and other clinicians to medical billing and coding team to front office staff. Here are basic ways which would help in increasing collecting and reducing AR days.

Clean Claim Submission

Try to submit claims with accurate information about patient demographics, insurance details, billing details, provider details, procedure codes, a set of diagnosis codes, and other information like preauthorization. Things became really easier if you submit clean claims in the first place. Submitting clean claims will ensure quicker payments. It’s a good idea to set goals for clean claim submission. Industry-standard for a clean claim is 90 percent while MedicalBillersandCoders achieve more than 95 percent of clean claim submission for all their clients.   

Set AR Goal

One of the important steps in reducing your AR days is to set an AR goal. You have to set this goal in terms of acceptable AR days. What does an acceptable number of AR days look like for your facility? Acceptable AR days numbers will differ depending on several factors including the type of facility and the mix of payers you have. Setting a specific, yet realistic goal for reducing your AR days will help make the process easier. You can share your AR goals with your team in brainstorming sessions. Post these goals somewhere so everyone, including yourself and your billing staff, can see them and have the motivation to achieve what you’re working towards.

Track Denials

Denials are another part of the healthcare revenue system that can get miscommunicated, delayed, and cause more AR days. By ensuring that you have processes in place for tracking denials can help your personnel understand how your facility handles denials to minimize time to payment. Experts from the billing and coding team along with providers should communicate on regular basis for denial management and resolutions. Most healthcare organizations just focus on submitting clean claims and forget about tracking submitted claims. Each submitted claim should be tracked within one month after submission. If the payment is received then payment should be updated along with pending patient responsibility, if applicable. All denied claims should be categorized payer wise and your accounts receivable team should start calling insurance companies to find out the exact reason for denial. 

Target Major Payers

You can target the top 5-6 payers that constitute the largest amount of billed AR over 90 days. Adopting payer wise approach for resolving AR, will help to find denial patterns for every payer. Every payer has their own set of billing and coding guidelines so you need to follow payer wise approach for handling denials. Your team can review claims payers-wise and try to find the root cause of denial and appeal it accordingly. Once you find the resolution, it can be applied to other denied claims from the same payer. You can always call and ask payer representatives the exact reason for denial and also ask for resolution. We always suggest talking with insurance representatives because it will reduce the rework. 

To Summarize, The Following Steps Will Help in Reducing AR Days: 

  • Determine goals in terms of AR days. The ideal number of AR days varies depending on the type of facility and its specific mix of payers. 
  • Work toward timely, accurate documentation by ensuring timely and accurate documentation for coding and billing cases and adequate revenue cycle staffing. 
  • Set clean claim submission goal. Set a goal of getting clean claims out within 48 hours of receipt of the required documentation.
  • Have a denial management team that includes experts from billing, coding, AR team and providers should assist wherever required. 
  • Ensure you have processes in place for tracking denials and that your personnel understand how denials are to be handled to minimize time to payment. 
  • Educate personnel on payer-specific policies to ensure that your personnel has access to training on requirements for Medicare, Medicaid, and major private insurers.

Outsourcing accounts receivable management services to MedicalBillersandCoders can help the healthcare organization to effectively reduce AR days. We follow up on your pending claims, find out the reason for denials, track outstanding receivable balances and provide periodic reports. To know more about our accounts receivable management services, contact us at info@medicalbillersandcoders.com/ 888-357-3226

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Medical Billers and Coders

Catering to more than 40 specialties, Medical Billers and Coders (MBC) is proficient in handling services that range from revenue cycle management to ICD-10 testing solutions. The main goal of our organization is to assist physicians looking for billers and coders, at the same time help billing specialists looking for jobs, reach the right place.

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