Last week, we discussed what 90+ Accounts Receivable (A/R) is and how to calculate the 90+ A/R Percentage. This week, we are looking at tips to reduce a healthcare providers’ A/R percentage over 90 days.
Hearing from company executives, they are most concerned about the 90+ A/R when that rate is not in the “okay” range (21-30%) or is in fact in the “poor” range (30% or more). The most important thing to understand is what is causing an increase in the balance.
Some questions to ask yourself are:
- What is the status of the claims within that 90+ A/R bucket?
- What is the average number of touches on the claims?
- Am I being efficient and productive in my claims reimbursement efforts?
- What is the trend? Has it historically been high or is there a spike?
- Is it a particular insurance that is impacting the 90+ A/R bucket?
If you are a middle-level manager, you need to understand what needs to be done to collect as much of the 90+ A/R as possible. You should be interested in the same issues as the executive, but you will be digging into the details to uncover the root cause and create projects to resolve the problem.
1) Focus on Front End
Focus on your front-end office by separating administrative work from the clinical setting. Once a patient is scheduled, a staff member is notified and can begin verifying insurance information and eligibility, requesting pre-authorization if necessary, and estimating patient liability.
Obtaining pre-authorization upfront prevents rejected claims and helps keep A/R days under control. If your front-end staff does their work efficiently, you don’t have to worry about patient collections.
2) Focus on Claim Denials
Denied claims represent a major lost revenue opportunity. Denials represent the 10 percent to 20 percent of claims that cause most missed revenue opportunities. When denials are allowed to accumulate, opportunities for collection can be missed altogether, and A/R days increase.
It is important to analyze denials and learn whether there is a root cause that can be eliminated to cut down on denials. Receiving denials in one location rather than multiple points of entry helps with consistent data collection that can help get to the root of claim rejection causes. Plus, it allows better time tracking so fewer claims end up rejected for failing to meet submission deadlines.
3) Run A/R Reports
Keep track of A/R trends and fluctuations by running accounts receivable reports every month. These reports should include aged receivables so you can track progress with older bills.
Usually, most of the claims will take an average of a month to be reimbursed. These A/R reports will help you find potential issues from a high viewpoint and the follow-up report will offer you a close-up look at the cause of the issues.
4) Institute “Zero Posting” Practices
Ensure that your cash team is posting all insurance correspondence in a timely manner. This includes:
- Letters letting you know that a claim was sent to the wrong address
- Letters notifying you that additional information has been requested
- Letters notifying you that a claim was rejected due to an incorrect patient policy number
If correspondence is not posted and tracked in the same way as a denial, you will run the risk of speaking with an insurance representative that may give bad advice on how to resolve the unpaid claim. Insurance companies are required to respond electronically or in writing, and that response is the most effective path forward.
Prochant is the leading reimbursement firm with a dedicated focus on HME and pharmacy. We have a proven track record of helping HME and pharmacy providers meet their financial goals. Our scalable solutions, years of experience, and advanced technology provide best-in-class results to the healthcare community. Headquartered in Charlotte, North Carolina, our client base includes national HME and pharmacy providers and health systems.