Old Accounts Receivable? Use Six Strategies
Updated: Sep 29
What is the first step in getting a grip on your healthcare organization's accounts receivable (A/R) performance? Detailed metrics including A/R aging, payor buckets and time period comparisons to start. Here are strategies to whittle down old A/R while managing current accounts.
1. Assess the Forest and the Trees
The first step in getting a grip on A/R performance is taking a bird's eye view then drilling down to the details. When the review is completed then it becomes a matter of letting the data speak. Set the task of cleaning up the old A/R as a standalone project with a separate goal.
2. Achieve a Goal Fast
To ignite momentum, it’s good to realize progress, however incremental, quickly. In this case, you might write off the 220 accounts less than $25 after one statement to the patient. Use the automated billing system features if payment is not received within your predefined time period. Small balances like these can then be worked by an early out or third party collection agency if it makes sense.
3. Allocate the Project
Settle on the average time it takes to work an account. This might be 10 minutes. Start with 30 accounts that will take about five hours to complete. Track daily as well as weekly objectives.
Of course, you still have to manage the current workload along with this old A/R. A suggestion is to hone in on an efficient process/work flow (remember, it will continually evolve). Have the old A/R worked by a separate in-house or external partner while maintaining the current receivables.
4. Collection Trend Reports
Analyze your practice's financial, and especially, A/R results, on a continual basis to monitor A/R effectiveness. This, combined with other reports, will highlight trends. For example, does the patient point of service collections look good while the claim denial percentage is rising? This focuses you on the problematic areas to tackle as a priority rather than thinking you need a complete A/R overhaul.
5. Scrub Obsolete Data
Patient databases can swell quickly. Best practice is for reception to verify insurance and patient information on EVERY visit. (This process can also be automated.)
Purge data from patients that left long ago. If a small overdue balance remains, consider writing them off as losses. Place large balances with the appropriate collection practices as soon as possible.
6. Collect from Repeat Patients
Stay firm in receiving patient payments at the time of visit. An effective way to handle this is to arm your front desk staff with the tools, techniques, and fortitude (maybe even include incentives like contests) to secure payment at the time of patient arrival.
Place visible signs that say payment is due at the time of visit and follow through. This includes letting patients know ahead of time that you expect payment at the next appointment.