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    Anticipation is first step in good billing process

    Q: Billing and collection are the bane of my existence. When things are going smoothly in this area, all is well. When one of these processes goes awry, the practice starts to have cash-flow problems, not to mention stress. How do we avoid billing crises and stay on an even keel each month?

    Thomas J. Ferkovic, RPh, MS
    A: Don't worry. Billing and collection issues are common. Most go through a period when processes fail and cash flow slows, whether the cause is staffing issues, computer system malfunctions, or the failure of a specific process or procedure. Too many practices jump to conclusions and spend resources and money on computer upgrades, new billing companies, staff overtime, and letters to the state insurance commissioner only to find out the problem was internal and easily could have been fixed.

    The key to minimizing the ill effects of billing and collection breakdowns are early recognition, systematic processes that are easily identified and repaired, and regular reporting that sounds an alarm when potential problems arise. Diagnosing what went wrong in the process will lead to a sustainable solution.

    Anticipation is the best first step to a good billing and collection process. Monitor daily or weekly cash status reports, weekly claim submission speed and follow-up reports from the payer, electronic claims submission error rates, aging payer accounts receivables, and quarterly claim denials.

    Set a standard and establish a weekly performance measurement to see how quickly the practice performs its billing function or sends claims to an outside billing company. Share this information with the practice management team, and include performance reviews of both staff and management.

    With these kinds of measurements in place, you can target specific aspects of your billing and collection process and flag potential issues before they turn into problems that affect your monthly cash flow and overall bottom line.

    Answers to readers' questions were provided by Thomas J. Ferkovic, RPh, MS, managing director of SS&G Healthcare Services LLC, Akron, Ohio. Send your practice management questions to
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