14 Best practices to boost AR productivity in Healthcare

Accounts receivable is the outstanding reimbursement amount owed to the healthcare providers for the patient treatments and services. The AR process caters to the overall financial management of a healthcare practice. Whether the financial responsibility falls on the patients or their insurance providers, healthcare professionals must stay on top to boost AR productivity. It can be done by outsourcing medical billing services and focusing on collections for the AR amounts.

How to Boost AR Productivity?

The longer AR goes unpaid, the less likely it is that healthcare providers will receive payments at all. Moreover, after 120 days, providers can only expect 10 cents per dollar owed in total.
Ideally, the AR cycle starts with the healthcare providers billing patients or patients’ insurance providers. Although it is indicated as money owed, ARs are not assets. Furthermore, the providers classify AR in terms of their age:

1 to 30 days
31 to 60 days
61 to 90 days
91 to 120 days

Not being able to collect payments or reimbursements lengthens the AR cycles and risks revenue leakage. Revenue leakage is when the treatment or care provided by healthcare professionals is not reimbursed, making providers suffer a loss.
For instances like this, what are some ways to boost AR productivity?

14 Best Practices to Boost AR Productivity in Healthcare

To boost AR productivity, efficient financial management and AR follow up are two backbones of the healthcare RCM process. AR management in medical billing reduces write-offs and thus ensures timely payments. Below are some of the best practices for boosting AR productivity in healthcare:

1. Verifying Insurance Eligibility of Patients

Healthcare professionals must verify patient insurance eligibility before performing services or giving treatments. On-time insurance verification reduces the likelihood of rejections and claims denials, resulting in timely payments. Furthermore, patient insurance verification ensures the correct capturing of insurance information during patient registration.

2. Open Financial Communication with Patients

To boost AR productivity, healthcare providers must communicate openly with patients regarding finances. Clearly defined payment terms will ensure that providers are more likely to avoid delays with AR. In most instances, healthcare providers can reduce delayed or delinquent payments by ensuring that all payment expectations are clear for patients before treatment. Creating a payment responsibility document for new patients to sign on their first appointment gives them a clear view and idea of what is expected from them regarding payments.

3. Accurate Medical Coding

Accuracy in medical coding ensures timely and accurate payments and helps boost AR productivity. Coding errors lead to claim denials, which result in payment delays. Healthcare professionals must have an expert and certified coding team that stays up-to-date with the current coding regulations and guidelines.

4. Practice Frequent AR Follow Up in Medical Billing

Payment delays are an undeniable fact in the medical AR recovery process. Therefore, it is vital that all of the outstanding and unpaid accounts are managed adequately. Close to 1.5 percent is written off as a bad debt, while 93 percent have to deal with payment delays. The longer outstanding accounts are left untouched, the less likely they will be paid. To boost AR productivity, it is vital to notify patients frequently, through phone calls and letters, even using stronger collection processes – if and when necessary.

5. On-Time Claim Submissions

Launching a system to track claims is essential to boost AR productivity. The timely submission of claims assists healthcare providers in receiving prompt payments. Having a proper system in place ensures timely submissions of claims – all within the specific timeframe. Delays in claim submissions slow down payments and increase denials.

6. Running Constant AR Reports

The main goal of running constant AR reports is to boost AR productivity by keeping the accounts receivable days low, which is most effective for the healthcare RCM. The particular procedure necessitates continuous tracking of accounts receivables. Moreover, it is helpful to carefully analyze the data from month to month to highlight the disturbing trends or the ongoing issues with payment collections. The AR report must examine things including:

Aged accounts
Average AR cycles
Duration of delays between services/treatments rendered and invoicing
Collection rates

7. Following up on the Outstanding Claims

Consistent follow-up on outstanding claims is necessary for securing timely payments. Moreover, it becomes vital to design a system for tracking the outstanding claims and then follow up on them regularly. What this can do is assist in reducing the number of claim denials and write-offs.

Get Co-Pays and Service Payments in the Office

One way your practice can boost AR productivity is by requiring patients to pay out the co-pays or the subsequent bills right in the office. Doing so will massively cut back on the accounts receivable for healthcare practices. Some medical practices require upfront deposits and percentages for treatments or procedures. Doing so does not cut down on a number of accounts, however it can cut down the monies owed.
Ideally, upfront payments become revenue, supporting the cash flow for healthcare providers.

8. Monitor Claim Denials and Appeals

Monitoring claim denials and appeals is vital to boosting AR productivity. It helps in the identification of trends and patterns of the denials. Healthcare practices must keep track of appeals and denials, as it helps analyze data to identify the root causes. Overall, monitoring of claims helps improve the RCM process and reduce denials.

9. Offering Multiple Payment Plans

Facilitating patients by offering them multiple payment plans to improve collections can also help boost AR productivity. Furthermore, creating a well-rounded system to manage payment plans and then implementing them correctly is vital for the financial health of your healthcare practice.

10. Increasing Frequency of the Billing Cycles

To boost AR productivity, providers or their billers can increase the frequency of billing cycles. The more frequently/quickly payers are billed for the services, the sooner those outstanding amounts can be paid. That said, many providers still send out bills once a month, which can introduce delays with accounts receivable.
It will be good to increase the frequency of billing cycles to speed up the processes. For instance, your practice can submit or mail insurance and patient invoices weekly.

11. Training Staff

Moreover, properly training your billing and administrative staff is essential for AR management. For instance, offering regular training to staff on the latest coding guidelines, regulations, and best practices helps improve the accuracy of the AR management process.

12. Consider Workflow Automation

Workflow automation for AR frees up time by effectively handling the heavier tasks associated with AR. Many software and tools now make AR more possible and accessible. Such programs can help with benefit verifications, claims submissions, and also creating AR reports. Such automation makes collections and invoicing easier and more timely–collectively, AR automation reduces issues with claim denials and overlooked AR accounts.

13. Outsourcing Medical Billing Services

Efficiency and accuracy in medical billing are essential to boost AR productivity and keep AR days as low as possible. Something as tiny as a claim error can delay payment from insurance providers for weeks or months. If your in-house billing procedures and team are not as efficient as they should be – consider outsourcing to third-party medical billing companies.

Conclusion

After the Affordable Care Act’s passing in 2010, most Americans signed up for higher-deductible plans to reduce their monthly expenses. However, this choice leaves most patients responsible for a high percentage of their healthcare bills. Furthermore, recovering reimbursements from individual patients brings many more challenges and a significant burden on AR processes. Therefore, implementing the above 14 best practices to boost AR productivity can help providers achieve a more successful healthcare RCM.