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    Accounts receivable: Strategies for better management

    From eligibility verification to patient engagement, managing accounts receivable is a vital process to maintaining financial health

    The aging of your AR is crucial to watch because the older bills get, the harder and more costly they become to collect, says Laurie Morgan, MBA, a senior consultant with California-based Capko & Morgan. “When your AR slips and you have a very large backlog or balance, it can seem like you’ll never be able to tackle it,” she says.

    What’s more, this challenge has been compounded in recent years by the rise in patient financial responsibility for medical care. While high-deductible plans have existed for some time, they’ve become even more widespread as more and more products available through new health insurance exchanges offer low premiums in exchange for high deductibles or coinsurance.

    Related: Getting paid: Strategies and best practices

    The multitude of new plans available to patients can in itself result in complexity and confusion for practices. Throw in the fact that many affected patients are unfamiliar with how health insurance works in the first place, and AR can suffer dearly.

    Analyze your AR in detail

    The first step in improving your AR is to analyze your starting point. But just as the proportion of patient-paid AR has evolved, so too should the way you run reports. “It’s important to break down the patient AR from the insurance AR to be able to understand what’s driving each of them. You can’t just look at it as one massive AR,” says Morgan.

    So if you note that your patient AR is mounting quickly, for example, that could suggest deficiencies in your front-desk processes or the way employees communicate to patients about your financial policy. Declining performance on the insurance side could also indicate front-desk errors, or point to a larger issue related to a third-party or centralized billing function.

     

    NEXT: Prioritize insurance verification

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