Accounts Receivable in Healthcare: An Overview MHC

Healthcare is one of the most heavily regulated industries there is, and that includes your AR operations. By understanding and leveraging these technologies, medical practices can focus more on what they do best—providing excellent patient care. It is observed that training of employees might be costly and time-consuming; however, it saves a lot of money for healthcare organizations in the long run. If healthcare staff that is responsible for billing are not trained properly then, they can make coding and billing mistakes which cause unnecessary spending.

What is Account Receivable in Healthcare?

Accounts Receivable is one of the most important components of healthcare revenue cycle management. Effective AR management guarantees that healthcare organizations receive timely reimbursement in addition to offering high-quality care. Yet the best of claims processing systems is no guarantee of payment for every trip.

Medical Practices Guide to Accounts Receivable

Every healthcare organization must track and obtain itsaccounts receivable during the medical billing process. A great number of medical organizationsutilize expert accounts receivable services to ensure that these payments areappropriately filed, processed, and received. While capturing patient details seems like a common sense practice, it’s a truly vital piece of successful AR management. But manual, outdated collection processes (e.g. spreadsheets, disparate systems and tools, paper forms, etc.) can make it difficult to capture and update customer information. That’s why many contra asset account healthcare organizations have started leveraging automated solutions.

• Look for a healthcare technology company with experience in multiple billing software systems.
• These services are usually tied to a pay-by-phone option that can improve response.
• If you have a lot of accounts receivable payments that need to be collect, feel free to get in touch with our AR Team.
• When writing this policy, it is essential to use language that patients can easily understand and avoid using technical terms or jargon commonly used within the office.
• To help practices evaluate their needs and make informed choices when selecting a practice management system, the AMA and the Medical Group Management Association have created a collection of informational resources.

Disorganized Collection Process

Providers can better plan their budgets and direct resources where they are most needed by cutting down on the number of days outstanding. Ensure you have a good understanding of just how much is outstanding and where there is opportunity to recover. In part one, we will cover identifying outstanding patient accounts receivables. Financial policy is a daily operating procedure and should be understood well. Proactively informing the patient before they see the physician is the best way to be upfront and honest with the patients. When writing this policy, it is essential https://www.explinks.com/blog/proforma-invoice-vs-estimate-differences-examples/ to use language that patients can easily understand and avoid using technical terms or jargon commonly used within the office.

Healthcare providers can lessen their administrative burden and concentrate more on patient care rather than collecting fees if they have the appropriate tools. If the denial rate is higher than 10 percent, you’ll need to investigate your RCM process and improve it from eligibility and coding to billing. Monitor facility accounts closely so as not to risk compliance of you or the facility. Facilities may need routine in-person meetings to ensure service and payment issues stay on track. The payer’s process involves easily completed forms, including methods to submit multiple claims at one time. Providers need a robust approach to time-of-service collections for non-covered trips, wheelchair van services, and inter-facility air transports.

Step 1: Patient Receives Care

• The longer the duration between the provision of medical services and the receipt of payment, the higher the AR balance.
• Because healthcare companies face such unique challenges when it comes to their billing operations, properly managing accounts receivable is even more essential than in most industries.
• As is the case in any industry, accounts receivable in healthcare dramatically lose value over time.
• This team of experts is available to provide guidance and support, ensuring that pharmacies maximize the benefits of A/R functionality and address any financial concerns effectively.
• Medical billing software, for instance, can automate many aspects of the billing process, reducing the chance of human error and accelerating the payment cycle.
• For pharmacies with delivery services, A/R accounts prove invaluable for billing patients on a monthly basis.
• AR management is often outsourced to specialized suppliers by healthcare facilities.

Establish a clear collection policy for overdue payments, including periodic courtesy calls, letters of demand, and, potentially, deployment of a collection accounts receivable log for individual patients service. This will arm your AR department with an actionable set of steps should a customer fail to meet deadlines. The fast-paced digital age offers numerous solutions to streamline AR management. Medical billing software, for instance, can automate many aspects of the billing process, reducing the chance of human error and accelerating the payment cycle. Ensuring accurate coding and timely claim submission can reduce payment delays from insurers.

Collecting at the Time of Service

• MHC can help you ensure better customer service and excel ROI with intelligent image retrieval, workflow automation, and transaction management.
• As a nurse-owned and operated business, we have deep knowledge and understanding of patient care and can help you successfully recover your outstanding accounts receivables.
• Add to that the time and expense of processing invoices manually, routing payment documents for approval, and sending out payment reminders.
• As we’ve noted, there are some unique elements of the accounts receivable process in healthcare.
• Accounts Receivable (AR) is the money owed to Providers or medical billing companies for the medical care rendered to patients.

While it’s a delicate process, expenses for care should be clearly discussed and disclosed to patients at the time of service, whenever possible. Fortunately, there are some helpful steps for making the collections process a bit easier. In an industry as complex and fast-moving as healthcare, a strong accounts receivable (AR) process is crucial.