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Healthcare receivables or account receivables (AR) in healthcare billing is the total amount of money owed to the provider by its patients, insurance companies and other payers for the service(s) they have offered. It's a key part of a medical practice's financial health, so it is important to manage it well. Managing a medical practice’s AR is challenging when federal regulations are always evolving. However, to stay at par with these regulations is important to stay competitive.

Financial stability of a medical practice is significantly affected because of underpayments, delayed payments, and denied claims. With a great AR management system in place, healthcare providers can tackle these issues well, and continue to be on the path of growth and success. Medical revenue cycle management (RCM) companies offer accounts receivable services as an important component of the medical billing and coding process. By implementing actionable steps to receive balances, medical billing and coding service providers see to it that your healthcare organization’s AR is in good health.

What Is Accounts Receivable (AR) In Medical Billing?

Accounts Receivable (AR) are the outstanding dues owed to a healthcare provider for services rendered. In simpler words, it is the money a practice is waiting to receive from insurance companies, patients or other payers.

AR is the lifeblood of a practice’s revenue cycle. If AR is managed well, cash flows smoothly for your practice to focus on patient care. When AR is neglected, it can cause delayed payments, revenue leaks, and even financial stability.

AR process involves tracking, managing, and collecting these payments. It includes tasks like making sure claims are processed correctly, following up on unpaid claims, and sometimes negotiating with the insurance companies to resolve any discrepancies.

Why is AR Important in Medical Billing?

1) Steady Cash Flow

Cash flow is the backbone of any business, and healthcare practices are no different. Effective AR management ensures that payments are collected promptly. This allows practices to cover operating expenses, staff pays, and to invest better in patient care.

2) Lowered Revenue Leakage

Medical billing is a complex process. It is easy for claims to be denied or overlooked. Proper AR management helps identify and resolve unpaid or underpaid claims. This minimizes the revenue leakage, and maximizes your practice’s income.

3) Improves Patient Satisfaction

With AR handled effectively, patients are able to receive clear and accurate bills. This transparency builds trust and reduces confusion, leading to an improved patient satisfaction and loyalty.

4) Keeps Practice Compliant

Healthcare regulations are constantly evolving and non-compliance leads to costly penalties. A well managed AR process sees to it that your billing practices align with industry standards and legal requirements.

5) Reduced Days in Accounts Receivable

A high number of Accounts Receivable days mean that your practice is waiting too long to receive payments. This significantly impacts cash flow. Effective AR management helps reduce the number of days it takes to collect payments.

6) Better Financial Visibility

When AR is tracked well, it gives healthcare providers a better visibility into their financial health. A clear accounts receivable aging report helps prioritize claims that need to be followed up on first. Allowing you to spot trends, you are well informed on how to handle future billing.

7) Decreased Bad Debt

Bad debt is a result of payments for services rendered becoming uncollectible, usually after a prolonged period of non-payment. A good AR management process reduces the risk of bad debt through timely follow-ups, payment reminders, and clear documentation. This eventually protects revenue and prevents any unnecessary financial losses.

Steady Cash Flow

• Insurance companies may deny claims for various reasons- coding errors and missing information.
• Some payers take longer to process claims, causing cash flow problems.
• Higher deductibles and copays lead to unpaid patient balances.
• Many practices lack the time, expertise, or technology to manage AR effectively.

AR Management With Instapay Healthcare Services

Specializing in third-party medical billing and coding services, Instapay Healthcare Services lowers healthcare practice’s administrative stress. Streamlining the entire billing cycle, our AR management solutions focus on reducing days in AR. As a result, you have an improved cash flow, and an increased accuracy in claims. Instapay Healthcare Services solutions include:

• Team of billing professionals who ensure that claims are submitted accurately, and followed up on promptly, lowering denials and delays.
• Cutting edge tools that track and manage AR gives you real-time insights into your practice’s financial health.
• Identifying the root cause of claim denials, we work tirelessly to resolve them for you to receive quicker payments.
• Creating clear, easy-to-understand bills for your patients, we aim at improving their experience, increasing the likelihood of timely payments.
• Each practice is different and has unique challenges to tackle. Our services are customized to meet your specific needs.

Tips To Improve AR Management of Your Healthcare Practice

While partnering with a professional and a reliable billing service like Instapay Healthcare Services makes a world of difference, a few tips to improve AR management are:

• Submit claims as soon as possible to have a quicker turnaround. Aim to submit claims with 24-48 hours of service.
• Always verify patient insurance details before rendering services to avoid claim denials
• Do not let the denied claims slip through the cracks. Investigate the reason for denial and resubmit the claim quickly.
• Make it as easy for patients as possible by offering them multiple payment options, payment plans, and other convenient options.

Final Thoughts

Account Receivable is more than just a financial metric. It is a reflection of your practice’s efficiency and financial health. Cornerstone of medical billing, AR management includes accurate claim submission, effective claim denial management, clear communication with patients, and utilizing advanced technology to streamline processes.

As a trusted partner, Instapay Healthcare Services is passionate about helping healthcare providers to streamline their billing processes and maximize their revenue. If you struggle with AR management or simply want to improve your practice’s financial performance, Instapay Healthcare Services is here to help! Take control of your AR by contacting us today.