Without a doubt, medical accounts receivable is one of the most challenging functions of any medical business office. From making patient collections calls to responding to insurance denials, medical AR requires a wealth of knowledge and defined processes and procedures. Accounts receivable challenges are numerous, and if they are not remedied effectively, the business’s finances may suffer. This article will go over three accounts receivable challenges and solutions you can implement to combat each challenge.
Writing off unpaid charges is just like flushing money down the drain. While there are many reasons why write-offs may be necessary, you may be unnecessarily writing off money that could have been recovered with better AR management.
What your billing office does before and after billing a patient or their insurance is crucial. Simply billing them and expecting them to pay up is not sufficient. If there is no specific set of proven procedures in place to collect the funds due, reducing write-offs is impossible.
Solutions to Combat Excessive Write-offs
Reducing unnecessary write-offs translates directly to increased cash flow for your medical practice or facility. To minimize write-offs, consider implementing the following solutions:
- Offer easy payment options to patients – It should be easy for patients to pay their bills. If patients are encouraged to use a payment portal, ensure that it is user-friendly. Also, work towards accepting as many payment methods as possible, both in-person and mobile.
- Verify insurance eligibility before appointments – It is imperative to check all of your patients’ insurance eligibility before each appointment. Ensure that it is done as close to the appointment day as possible (a day or two before the appointment is usually sufficient). Performing an insurance eligibility inquiry weeks before an appointment is not recommended, as the patient may have a change in insurance coverage before the appointment.
- Request payment at the time of service – With a policy in place to instruct patients to pay their copay and any balances at the time of service, you may see an increase in patient payments and fewer write-offs.
- Reach out frequently to collect payments – While attempting to collect funds from patients and insurance companies is not glamorous, it’s an AR function that must be done consistently. Reach out by phone, email, and mail as needed.
Dealing with Insurance Denials
Obtaining payment from insurance companies has never been so complicated. Whenever your office receives a denial letter from an insurance company, this could negatively affect your cash flow.
In the following list, we will go over some of the most common health insurance claim denial reasons:
- The claim was not filed on time.
- The insurance company has deemed that the procedure provided by your office was unnecessary.
- There is an error on the claim form.
- The service provided was not covered under the patient’s plan.
- Pre-authorization was necessary but not obtained.
Solutions to Combat Insurance Denials
Each insurance denial must be addressed on a case-by-case basis, and the process can become very time-consuming. On top of that, every insurance company has its own set of regulations and procedures that govern claim processing.
For the above reasons, a dedicated AR expert, or group of experts, will be needed to respond to every single denial appropriately. They will know how to appeal an insurance claim denial and get the insurer to remit payment. In some cases, to remedy a denial, the claim may need to be resubmitted. In other cases, sending a reconsideration will fix the issue.
In the case of insurance denials, phone calls with long hold times, reworking of claims forms, acting within specified deadlines, and more may be necessary to recover the funds that your practice or facility is due.
Collecting Overdue Payments from Patients
Since patients often carry unpaid balances, reaching out to them to try to collect the money due is extremely important. If you’ve ever attempted to collect money from patients, you know how difficult it can be.
Here are some of the most common challenges that hospitals and medical offices face in patient collections:
- Getting in touch with the patient.
- Keeping exchanges with patients quick, efficient, and respectful.
- Handling disputes with patients who refuse to pay.
Solutions for Problematic Patient Collection Issues
You may be delighted to find out that there are patient collections solutions that your billing office can implement. In addition to other AR functions, use the following tactics to be more successful in collecting patient balances:
- Transparent statement format. Patient statements should be formatted in a simple way that emphasizes the patient responsibility portion and the services provided. This way, patients will be better informed of what they owe and are more likely to respond to collection calls or emails.
- Prioritize patients that are more likely to pay. Though it may be difficult to determine without sophisticated AR technology, your efforts should be focused on patient accounts that are more likely to be paid.
- Offer payment arrangements. Most people will not be able to pay their entire bill in full. To help them resolve the bill and start bringing in money, offer a payment arrangement where the bill amount can be broken up into equal increments over a specified period.
- Train staff to preserve the patient’s dignity. Taking steps to preserve every patient’s dignity has multiple benefits. It helps the patient feel more comfortable, increases their willingness to talk about payment issues, and reduces the likelihood of a heated exchange.
Should You Outsource Your AR Functions?
As you may have gathered, remedying AR challenges requires a ton of effort. If you’re unsure about whether your practice has the manpower to implement the above solutions, you’re not alone.
Consider outsourcing accounts receivable to a dedicated team that’s singularly focused on managing your business’s medical AR functions. DataSearch Inc. is a leader in the medical accounts receivable industry, leveraging accounts receivable automation, effective collection practices, and knowledgeable staff to bring you measurable improvement in your bottom line. Outsourcing AR will free up your staff to complete other business functions conducive to the provision of outstanding patient care.