Account Receivables are considered to be a major obstruction in the revenue cycle process that practices try to minimize as much as possible. However, the problem with revenue collection and account receivables still persists for a large number of medical practices, especially for those that do not establish strong billing mechanisms either in-house or outsourced. As a result, medical practices often try to find ways to manage account receivables in medical billing and coding.
What are Account Receivables in Medical Billing?
The concept of Account Receivables is associated with the overall payments that a medical practice is yet to receive as reimbursements for the services rendered to patients. These payments are mostly due on the side of insurance companies and those patients who do not have their benefits covered under the insurance.
In the medical billing system, the process is such that medical practices have to file for claim reimbursements using intricate coding known as CPT codes and ICD-10 coding is an example of such codes. This is where the idea of Account Receivables becomes prominent, and medical practices find it difficult to tackle this problem. Such receivables keep on adding up and take time to reimburse, especially in case errors are witnessed in the medical coding that leads to claim denials.
Revenue Leakages and A/R Management
As mentioned earlier, the medical billing system in the United States is such that it allows for revenue leakages and account receivables. The reason is the intricate level of billing and coding mechanisms being used for the purpose, where medical providers often find themselves entangled and submersed in the coding process. This negatively impacts their financial flows and revenue leakages start popping up. Moreover, such a system even impacts their professional healthcare performance as well, primarily because of the increasing workload they have to bear just in order to get the money they already worked for.
This is why A/R management has become highly imperative for the financial workflow of medical practices and proper guidelines are needed to tackle this impediment to revenue collection. Once a strong revenue cycle workflow is established, these account receivables are expected to decrease drastically and add to the overall revenues. Conversely, the question still remains, “How does one maintain a smooth revenue cycle for the purpose?”
Ways to Manage Account Receivables in Medical Billing?
Coming to the point, let’s look at some of the major ways to manage these scary account receivables for medical practices across the United States. As big of a mountain as it might seem from afar, it turns out that Account Receivable management is something that effectively lowers your account receivables and increases your revenue collections. However, there are some ways to manage these receivables and we’ve explained some of the most effective ones below:
Outsource A/R Management to a Professional Medical Billing Company
The first and most effective way to manage your Account Receivables, as well as claim denials, is to outsource the A/R management to a professional medical billing company. This is primarily because doctors and other medical providers already have a lot on their plates. They are entrusted with patient care, which is at the center of the entire healthcare system. If they are entangled with the medical billing and coding tasks, it is inevitable that they will have account receivables as well as negatively affect their patient care services as well.
This is why an effective solution to this problem is to let the professionals in the medical billing and Account Receivables management domain do their job. They easily find a professional account receivables management company that can provide them with the necessary wherewithal to manage their revenue leakages and lower their account receivables. If you are a private practice or a physician looking for such an outsourcing agency, just type, “medical billing companies near me” to find the top medical billing providers in town for optimal service provision.
However, you have to filter the best A/R management companies to find the one suitable for your needs. You can benefit from a number of other revenue cycle management services as well at a highly affordable cost. For instance, a medical billing company such as I-Med Claims LLC provides A/R management and billing services starting as low as 2.95% on all monthly collections. This eventually saves you the time and hassle to figure out ways to manage account receivables in medical billing.
Focusing on Patient Scheduling, Registration, and Eligibility Verification
Another way to manage your account receivables is to focus on making the initial process as clean as possible with upfront patient scheduling and registration. This allows for the smooth processing of the claim as the process starts off on the right foot. As a result, the chances of errors reduce drastically.
Gary Marlow, The Vice President of Finance at Beverly Hospital and Addison Gilbert Hospital claims that getting the most accurate information up front starts with patient scheduling and patient registration… which provides the foundations by which claims can be billed and collected in the most efficient and effective manner possible.
Further, according to estimates, almost 70-75% of claim denials are caused due to errors in eligibility verification and breakdown of benefits. This is proof that the initial process is highly crucial and medical providers have to be vigilant in checking whether a patient has his/her benefits covered under the insurance plan. Once this process is cleared without any errors, the rest of the revenue cycle process becomes highly convenient for your in-house medical billers or the medical company to whom you’ve outsourced your work.
Therefore, it can be concluded that breaking down benefits and eligibility verification plays a pivotal role in reducing the magnitudes of account receivables. It is hence considered amongst the top ways to manage account receivables in medical billing and coding, and medical practices have to ensure efficacy in this initial step of revenue cycle management.
Maintaining Accurate Charge Entry for Services
The concept of charge entry emanates from the idea of billing patients in accordance with the services provided. The charge entry cannot be one penny more or less than the actual cost of the healthcare services incurred to the patients. This is why medical practices have to be highly careful while charging for the services they offer, and errors in this step of the revenue cycle management can often lead to claim denials.
So a major way to manage account receivables in medical billing is to pay attention to the charge entry process and see if there are any revenue leakages in the process. You’ll be surprised to see the results of such an approach with account receivables dropping and revenue collections increasing with time. As a result, the entire revenue cycle process will see a boost, and you can surely expect lucrative claim reimbursement rates with minimum account receivables.
Have a Strategy for Denial Management
One of the biggest reasons for high account receivables is the rate of claim denials that are not managed effectively. As a result, the account receivables become an intricate puzzle that needs to be solved at the earliest. This is where you can outsource your denial management to a professional medical billing company that helps you elevate your performance by ensuring follow-ups and appealing denied claims.
Although claims denials are difficult to navigate, it is certainly possible to incur denials based on minor errors in any step of the revenue cycle process. The solution is to have a team that excels in the necessary skills required to tackle such denials with optimum denial management strategies. This is considered to be an effective way to manage account receivables in medical billing and coding for medical practices across the United States.
A Roundup of All Ways to Manage Account Receivables
To put it all in a nutshell, account receivable management or A/R management is a major domain in the medical billing industry. It allows medical practices to control their revenue leakages and ensure a good financial workflow that enables them to gain maximum leverage while providing patient care. It gives them an independent workflow that contributes to effectiveness in the bottom line which is healthcare, and not worrying about getting paid for it.
Therefore, these ways to manage account receivables in medical billing and coding can provide medical practices with an essential foundation to minimize their revenue leakages. It ensures a high claim reimbursement rate and contributes to the overall financial health of your medical practice, enabling it to grow and scale with time. As a result, the entire revenue cycle management system is uplifted in a lucrative manner, and patients are catered to without any hassle or interruption in the process.