Accounts receivable and claims denial management systems are crucial to the profitability of the revenue cycle. When it comes to a company’s financial health, it is these revenue cycle operations that make all the difference. It doesn’t matter whether you outsource all or just a portion of your revenue cycle management operations, you can be certain that your investment in AR and Denial Management will provide significant net returns.
What is AR Management?
The practice of receiving client payments within a certain time frame is known as accounts receivable (AR) management. Every stage in the process of collecting money when a consumer placed an order is tracked and managed by AR follow-up for businesses selling goods and services. Building liquidity and profitability is essential, as is preventing bad debts. Receiving payment on a bill is just one part of this process.
The difference between a struggling company and a thriving one might be the strength and efficiency of the AR management process. Customers’ happiness and cash flow would be negatively affected if an organization’s AR is still managed manually.
AR Management in Medical Billing
The accounts receivable aging is the most important thing to watch for, the sooner you get the returns the better you will find the financial health of your practice. Delayed collections and aging bills are more difficult to get reimbursed and each AR follow-up round would increase the operational burden and resource cost. Subsequently, by the end of a fiscal year, your practice can suffer huge losses due to piled-up unpaid bills and it would become impossible to handle the burden.
AR management has become more challenging in recent years when practices are dealing with a rise in the payments owed by the patients. An increase in the number of patients on self-pay is making practices’ jobs more difficult; they are required to realign their collections strategy. Practices should learn to handle the dilemma of high-deductible insurance plans. Dealing with a payer or an insurance carrier is totally a different scenario than following up the patients who are liable to pay back a major part of their medical bill. In such a situation, AR management becomes even more perplexed when practices are not ready to handle it and patients are unaware of their insurance plan. So, what practices should do to keep their collections optimized with a perfect AR management strategy?
It is apparent that in such a situation where practices are required to handle multiple payers and everyone with a different process of payment then no single strategy can be fruitful. That is why more and more practices are outsourcing their billing to professional companies because they have specialized resources to handle all types of collections. They know very well the difference between patient AR management and insurance AR management. However, physicians should not segregate the billing from the front desk and other clinical processes. AR management is only effective if the front desk is working properly. It is not the billing company or the accountant that communicates with the patients about the payments, it is the job of the front desk to effectively communicate with the patients and deliver them very clearly about their financial liabilities. So, if you are experiencing a decline in collections despite following an orderly AR plan, then you should check your front desk staff for possible improvements.
Denial Management in Medical Billing
During the last decade, healthcare has undergone a lot of transformation. Not only physicians and medical practices have changed to different working styles, processes, and technologies, insurance companies have transformed as well. Insurance companies are devising new plans to compete in a saturated market with insurance plans that can paint a desirable picture for buyers. They are offering insurance coverage with low premiums but higher deductibles. In doing so, they are adding up new requirements and regulations to make it difficult for claimants to get their payments. To ensure this, insurance companies are using sophisticated technologies that can easily detect a fault in the claims. So, the heightened requirements are resulting in the escalation of claims being denied. So, there is a need to implement a denial management strategy. First of all, practices should devise a system to keep track of the denied claims. They should be using advanced practice management systems to enter all the claims that are denied with the reason. By entering this data, practices can easily take a view of the percentage of denied claims with their dollar value. In the next phase, practices should look for the major reasons for the denials. Most commonly, it can be due to unauthorized service, wrong medical codes, mismatched patient information, missing documents, or a problem with physician credentialing. In the last stage, make corrections and provide all that is required by the insurance company and resubmit the claim. These are just the basics of AR and Denial Management. The medical billing professionals of Sybrid MD are proficient in handling all types of claims, insurance companies, and medical specialties. If your practice is experiencing claim denials and aging receivables, then stop worrying about it and reach us for a free consultation session.
To Sum it Up
AR and Denial Management services should be outsourced as it will increase your revenue by reducing the number of unpaid claims and so reducing the amount of money you lose. Moreover, efficient accounts receivable in healthcare is one area for effective practice management that can greatly improve profits. When you comprehend the cost of carrying an unpaid balance along with measuring the performance with the right metrics, you will then begin to see more opportunities to improve.