Efficiently managing accounts receivable (A/R) poses an ongoing challenge for RCM companies of any size. While recognizing the importance of reducing A/R for enhanced practice efficiency and profitability, RCM staff may find themselves uncertain about tackling issues such as prolonged collection periods and small insurance claim denials.
Navigating A/R management can be intricate. It involves multiple stakeholders, including insurance carriers, patients, front office staff, billing staff, and healthcare providers. Collaborative efforts from all parties are essential to achieve clean claims and prevent denials.
The key to optimizing medical billing A/R lies in minimizing claim denials and expediting the patient collections process. Additionally, patients and practice staff must complete error-free paperwork, and the billing company needs to submit claims on time. Moreover, diligent follow-up to rectify errors and address overdue accounts are pivotal.
In this article, we will explore how medical billing companies can unlock their clients’ revenue potential by minimizing outstanding payments. By implementing these approaches, RCM companies can enhance their clients’ financial performance while streamlining their billing processes, ultimately leading to greater prosperity for both parties.
A/R Is a Collaborative Effort
The practice staff plays a key role in reducing claim denials, so they should be privy to the A/R management process. This will ensure that everyone is on the same page and can work to identify issues and develop solutions. It will also help to increase efficiency, avoid redundancies, and eliminate mistakes that could waste time or profitability.
The front office staff is the front line of A/R. They are the first to verify and update patients’ insurance and personal demographic details such as address and contact information. They must also ensure that patients sign certain documents, such as financial policies. Providers are the next line of A/R.
Providers select Current Procedural Terminology (CPT) codes and must be mindful of tedious details such as bundling correctly, so that claims are approved and paid. A conscientious provider should not only select appropriate billing codes, but also double-check the patient information that the front office staff provides.
The billing company is the final line of defense and should triple-check that patients’ information and CPT and ICD-10 codes are correct. As addressed above, billing company staff are also responsible for submitting claims timely and without duplication.
1. Establish Financial Policies
RCM companies need clearly defined financial policies for every practice. These policies should clarify financial details, workflows, and processes. Here are a few elements to consider:
- State whether the practice will accept personal checks and, if so, what charges or actions are in place for bounced checks. The practice should consider implementing technologies that convert paper checks to electronic transactions and verify them before patients leave the office.
- Include a financial responsibilities section that outlines who is responsible for the amount due if a patient’s insurance carrier partially or fully denies a claim.
- Define the debt collection process. Patients should know how long they have to pay their bills and at what point the practice may sell their debt to a third-party debt collection agency.
- Medical records can be copious, and practices often need to make physical copies of them. Although some practices implement a policy that covers a pay-per-page cost associated with medical records, others provide them at no charge to the patient. Regardless, there should be a policy in place.
2. Automate Patient Statements and Payments
Offer different payment options to patients by implementing technologies and creative solutions that make it easier for them to pay their bills. Look for solutions that reduce manual work and track efficiencies across delivery modes. Here are a few approaches to consider:
- Automate statement delivery via text message or email (with patient acceptance of those communication methods) to help improve the rate of online payments.
- Add QR codes to online and paper statements to help patients quickly access payment portals.
- Offer payment plans, especially with no interest, to make it easier for patients to pay down balances.
- Offer self-pay discounts to patients who are uninsured or choose to not utilize their insurance, provided that they pay the full discounted amount on the date of service.
3. Establish a Written Collections Process
It should be a practice imperative to collect payments at the time of service. The billing company should have a written policy on the collections process which can help to alleviate that pain point and clarify the practice’s policies and procedures, so that patients know what to expect in advance. Here are some guidelines to follow when creating these policies:
- Include when, how, and how often you send bills.
- Provide information on payment plans and assistance programs, if available.
- Encourage patients to utilize Health Savings Accounts (HSAs) or Health Reimbursement Arrangements (HRAs) when available.
- Describe the different available payment options and whether patients can pay over the phone, online through a payment portal, etc.
- Clarify which extraordinary collection actions you may use, including selling the debt or taking legal action.
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How your billing company responds to patients’ behavior is one of the most important processes to develop when it comes to collections. Communication should not be one-size-fits-all. Patients expect personalization, and reaching out to them based on their preferred means of communication leads to optimal results.
Perseverance is vital when it comes to collections. By establishing clear policies and implementing integrated technology throughout your processes, you can improve the patient experience by eliminating confusion while reducing the administrative burden on your staff.
Following these steps can help your company reduce A/R for your clients, and implementing these tips will help minimize costs and maximize revenue potential for your company and your clients.
It is also good to remind your clients that outsourcing saves valuable time, money, and resources, since medical billing companies offer specialized expertise, advanced technology, and a robust infrastructure to streamline their revenue cycle and ensure prompt payments. Moreover, outsourcing liberates the practice’s staff time and resources, enabling healthcare providers to prioritize patient care and other vital aspects of practice management.
