Payment delays are a serious threat to the cash flow of healthcare organizations. Similarly, the rising accounts receivable make the revenue cycle inefficient. In addition, AR management in medical billing is an important concern to manage claim denials. Likewise, medical practices lose revenues with greater AR backlogs. So, preventing claim denials and making the claim submission process accurate can help practices get reimbursements on time.
What is AR in Medical Billing?
Accounts receivable medical billing refers to the money owed to the medical practice by the insurance company. In addition, when the patient or the insurance payer needs to pay for the billed services, it is known as accounts receivable. So, AR leads to greater workload for the practice staff and results in additional costs leading to revenue losses. Therefore, it is essential to ensure that AR backlog is minimal and practices manage their denials effectively.
Steps to Enhance Cash Flow with AR Management
Clearly Communicate Patients About Payments
When the providers clearly communicate the terms about the payments to their patients, claim denials are less likely to happen. In addition, AR management in medical billing helps to reduce the number of days in AR. Further, medical practices should discuss the payment terms with patients before rendering services. So, the discussion with the patients before scheduling appointments can reduce the chances of AR backlogs.
Frequently Follow-Up on Outstanding Payments
AR follow up in medical billing helps providers to know the details of payment delays. In addition, the management of unpaid claims should be done appropriately to avoid revenue losses. Similarly, not following up on the accounts receivable may lead to non-payments. As a result, medical practices make their cash flow inconsistent and face revenue leakages. So, making a proactive AR team can help minimize the delayed reimbursements.
Running Consistent AR Reports
Keeping the AR low enables healthcare practices to keep their revenue cycle efficient. Similarly, having an insurance follow up specialist can keep track of the pending payments. Also, the practice staff who is managing the AR should thoroughly monitor the payments to optimize collections. As a result, the AR management in medical billing brings revenue optimization for the healthcare practices.
Take Up-Front Payments from Patients
Medical practices can collect the co-pays from the patients at the office. As a result, it reduces the amount providers have to collect and minimizes the AR. Also, healthcare practices can support their cash flow with these up-front payments. Making the AR medical billing process seamless, this step enables providers to reduce the collectibles. So, increase the collection rates by taking up-front payments from the patients.
Outsourced Billing Services Can Help
Outsourcing billing and collections enable healthcare providers to streamline the accounts receivable. In addition, third-party billing companies offer AR follow up services to help reduce the AR backlog. Moreover, professional medical billers know how to minimize accounts receivable leading to faster payments. So, AR management in medical billing plays a crucial role in maximizing the financial performance of medical practices.