When you review your December 2018 billing reports, take a close look at your A/R Aging Report to determine the amount of unpaid money in the 120-plus-day bucket.
How much of your total A/R is over 120 days? In an ideal world, the percentage would be zero. The reality is more than likely your 120 plus days in A/R is between 15 to 20 percent of your total A/R, and hopefully not any greater than this. Once you review the A/R report, it may be time to have your billing staff focus on working the old A/R to get it paid, write it off or send it to a collection agency.
The first step is to run an A/R aging report from your practice management system to determine who is responsible for the 120 plus days in A/R. Is it the insurance payer or the patient’s responsibility? You will want to make a plan for each type of payer.
- Insurance Payer: Run the A/R aging by insurance payer. Determine which payer has the most outstanding claims. Review your participation agreement for each insurance payer to determine if you are within the timely re-filing period. If not, consider writing off these accounts. Review the claim to determine the reason the claim was initially denied. For example, if you did not have the proper authorization at time of treatment, then you will not be paid, and this claim should be written off.
- Patient Responsibility: Run the A/R aging by patient responsibility. Determine if the patient is a recurring patient, or when the last time the patient was seen in the office. The front desk or billing staff should be notifying patients at the appointment reminder phone call that they have an outstanding balance and ask the patient for payment at this time. Do you have a policy regarding a patient making an appointment if they have an outstanding balance? How often do you send statements?
The next step would be implementing a plan to work the outstanding A/R. There are various methods from oldest to most recent, highest to lowest amount, alphabetically from A–Z or Z–A. No matter what your method, the key is to continue to work the A/R consistently.
Consider running a claim denial report to determine trends. Some of the trends may be easy to fix, such as missing modifier, correct provider identifier on the claim, or service is not medically necessary. Check the claim denial report to determine if trends are insurance payer specific. Maybe it might be time to call your Insurance Payer Claims Department to discuss why the denials are occurring. Once you have this information, talk with your staff to determine how to avoid these errors before the claim is submitted.
When all efforts to collect outstanding balances have been exhausted, it is time to consider writing off the account or sending the account to a collection agency. Does your practice have an account write-off policy? Does the policy specify the amount the billing staff are authorized to write-off according to protocol? Are amounts exceeding the protocol reviewed by the physicians prior to writing off the account or turning the account over to the collection agency? Review the accounts with the physician before the account is turned over to the collections agency. The physician may have received referrals from this patient which generated several hundred or thousands of dollars in revenue, which could mean it may not be prudent to send this patient to collections.
Continue reviewing the A/R aging report throughout the year. A “clean” A/R will give the practice a better picture of their financial health. So, take the time at the beginning of the new year to review your A/R and clean up your accounts. It may be time for a revenue cycle review to assess your entire billing and collection process.
Concordis Practice Management can perform a thorough revenue cycle review of your practice and can also assist with A/R collections. Contact Concordis at 210-704-1014 today for a consultation to see how we can help.