- October 15, 2024
- Posted by: David Smith
- Category: Hospital AR
Accounts receivable (AR) in medical billing is the money owed to you by patients, insurance companies, or other payers. Managing your AR can be tough with all the complex regulations, but it’s key to keeping your finances stable. You probably deal with delayed, underpaid, or denied claims all the time. The good news? A medical billing company can take this burden off your shoulders. AR management is one of their core services, and they can help you take the right steps to collect payments and keep your AR in good shape. But before you navigate the intricate nature of hospital accounts receivable, you must understand what hospital AR is.
Comprehending hospital accounts receivable solutions:
You should ideally submit a medical claim within 72 hours after providing a service. If the claim is clean and submitted electronically, you could get paid within two weeks. But delays happen for many reasons.
Based on a report shared by American Hospital Association, almost 50% of hospitals and healthcare systems had almost $100 million because of aged accounts of more than six months old. By streamlining the perfect hospital AR management services, you can receive faster payments and keep your cash flow healthy.
If your collections are delayed and overdue payments keep stacking up, your days in accounts receivable will increase. Days in Accounts receivable (AR) can be defined as the average time that it takes for your hospital to receive payments from the patients and their insurance companies. You must clearly understand how to measure your AR days so that you can improve the overall financial help of your hospital. You can know the AR days by diving the whole AR by your hospital’s daily charges. It is always recommended to keep your AR days lesser than 50 days, though, in an ideal situation, keeping your accounts receivable days within 40 days would be a best practice for you.
Tracking your days in AR shows you how long it takes to collect payments on average. This helps you spot any issues and take steps to improve collections and your overall revenue cycle.
It is really important for you to know about the common reasons behind increased days in hospital AR.
The common factors behind increased hospital accounts receivable days:
- Unnecessary claims filing delay
- Absence of verifying a patient’s insurance eligibility
- Coding errors
- Inaccurate data entry
- More number of rejected claims
- Poor appeal process
- Delayed credentialing process
- Inefficient payment posting process
- High amount of out-of-pocket payments for patients
Fortunately, you can easily keep track of your delinquent accounts, asses payment actions and implement the market-leading strategies to collect payments faster by hiring one of the best hospital AR management services. A perfect hospital AR outsourcing company always implements the steps mentioned below for your hospital-
1) Prior to each appointment verify a patient’s insurance eligibility:
Knowing your patient’s current insurance information is key to understanding both their coverage and their financial responsibility. Insurance verification specialists check and confirm details like insurance, demographic info, and contact information. This enables you to know the information mentioned below:
- How much treatment costs your patient’s insurance company would cover
- How much your patient is going to pay out of his pocket
You should update patient records before their appointment so the insurance verification specialist can confirm their coverage with the payer. Checking patient eligibility at each visit also helps you spot any unpaid balances from earlier visits that the patient needs to take care of.
2) Inform your patients about their responsibilities:
A perfect hospital accounts receivable company always informs your patients about the financial responsibilities in advance so that you won’t feel surprised later. They can also help you in drafting a clear payment policy that outlines your payment expectation. This helps everyone understand what to expect.
3) Establish a clear communication with your payers:
You should always keep proper tab on the payments from your patients’ insurance companies. The MGMA recommends looking at collections by each payer to see which insurance companies are slower to pay and which have more denials. A medical billing company can help you track these payments by providing a monthly report that shows your AR cycles over different time periods. This way, you can see how much a payer owes you, how much you haven’t collected yet, and if that amount is going up. They’ll also keep track of every claim so they can correct and resubmit any denials or rejections.
Read More:
How to Ensure You Get Paid: Understanding Hospital Accounts Receivable
Facing challenges in hospital accounts receivable? Discover how our expert services can streamline your billing and improve collections. Contact us for support!
4) Leverage proper data analytics:
Using data analytics and real-time news can help you spot trends more easily. With strong analytics, you can catch underpayments early and make smarter decisions for your practice.
5) Use a perfect ERA:
A smooth revenue cycle helps you get paid accurately and boosts your chances of receiving full payment for your services. Electronic remittance advice messages (ERAs) from insurance companies are standard reports that your computer can read, showing you the payments you’ve received. An ideal ERA can help you collect more, work more efficiently, and get your practice paid faster.
Now that you know how an efficient hospital accounts receivable company enables you to implement a perfect hospital AR management service, it’s time to make a perfect move by partnering up with Sunknowledge. We, at Sunknowledge, have already enabled hundreds of hospital boost up their overall collection up to 97%, while we only charge only 2% of overall collection.
Schedule a non-obligatory call with one of our billing experts to know more about our hospital accounts receivable services.