Eliminating Your Medical Practice's Aging Accounts Receivable

Even with a good, solid plan in place, and a decent billing department your aging accounts receivable (A/R) is still out of control. Days turn into weeks, months, and even years. Is it a silly pipe dream to think you can actually eliminate the 120+ category with your A/R? With these tips, it's not only possible, but quite probable in the near future.

In order to take on what may sound like a daunting task, let me assure you that it is not that bad. Breaking each area down is the key. So let's get started.

Identification

The first thing you will want to do is identify what your 120+ is made up of. Is it a bunch of uncollectable A/R that you don't have the heart to adjust off? No reason to leave that kind of A/R on the table. If you have hit timely filing deadlines, it's time to adjust.  Did you not obtain the proper authorization or pre-certification?  You can either fight to get these retro-authorized, or you can adjust it off depending on how old the A/R actually is.

If it's less than six months old, try to work it. If it's older, eliminate it. Is the A/R a bunch of secondary insurance? If you have not hit the timely filing deadline for that insurance, submit those claims immediately with the proper documentation (primary EOB, perhaps chart notes, etc.) Do you have a large workers' compensation load? The trick to eliminating this A/R is to get on the phone with the adjuster today. Is the A/R clean claims that were denied or dropped from the insurance company "just because"? These are quick and easy to remedy.

Create Your Plan

Now that you have identified where the A/R is sitting, it's time to create your plan of attack. This is where you get to pick a staff member for a special project and let them loose. By having the A/R broken down by class (insurance type) you can quickly and easily make one phone call and get several claims reprocessed. Those "just because" denials are now reprocessing. If you have hit those timely filing deadlines, time to adjust it off. Your plan should include a timeline or deadline of project completion.

A good and solid employee can be on the phone and quickly get several claims re-billed within a day. Let them get started, and then ask for feedback on how long each phone call takes. You can multiply this out and come up with a completion date. You will also need to prepare yourself for how much of the aging A/R that is uncollectable. This is a difficult pill to swallow in most cases, so facing it head-on is the best approach.

Don't Go Back

Now that you have your plan in place and have implemented the actions, you will need to conclude about how those claims came to be in the 120+ category, and make sure it doesn't happen again. Was anyone in the billing department following up on those claims? How do you know for sure? Is the insurance company promising payment, and then not delivering? You do have the ability to turn insurance companies into your state's insurance department. You can find your department on your state's main government website. They have a form you can fill out and mail in. The department will investigate and if they find the insurance company negligent, you get paid - quickly. If you have found that many of the denials are coming from bad information (i.e., wrong date of birth, name does not match card, policy number wrong, etc.) it's time to review your policies and procedures up front to ensure your are sending out clean claims.

The whole idea is to prevent claims from rolling past 30 days. If you can harness this possibility in your mindset, you can implement it and get paid for all of those claims!