Have you been reviewing your practice revenue situation before the insurance AR turns out to be bad debt or write off amount? Is your current billing vendor appraising you on your AR backlog? And explains the reasons? Remember, it is hard to collect payments and increases manual effort as the claims get older.
Most medical billing software provides a basic insurance AR backlog report that will indicate how revenue is categorized in a time bucket. Anything more than 120+ days, it becomes Doubtful Debt (money that predicted to be uncollected and turn into bad debt).
Here is where your billing vendor plays a vital role. And as a practice owner or manager, you also play a critical role in ensuring your billing vendor prevents bad debt. In an ideal situation, claims would get paid within 30-45 days from the date of submission. For the rest, follow a systematic process as indicated below. As the healthcare reimbursement rules changes very frequently it is important that this prevention process is a continuous activity in the revenue cycle process.
To have a healthy cash flow and prevent bad debt to occur, it is important that practices' measure and monitor the following key revenue metrics
Account Receivable Trend
Days in A/R - Indicates average time it takes a claim to be paid
Percentage of A/R over 120 days
MediCommerce is an expert in coding and billing services for medical practitioners and hospitals. Not all billing services to suited for all customers. Our deep and broad experience in revenue cycle management consulting and services customized for each specialty, focused to minimize the percentage of denials and maximize their revenue for steady cash flow.