Hospital accounts receivable represents the payments owed by patients and insurance companies. Handling AR effectively is the key to maintaining both financial health and operational efficiency in your practice.
In this blog, we are going to discuss the following things related to hospital accounts receivable services-
- What is hospital accounts receivable?
- Impact of efficient hospital accounts receivable management
- Overview of an efficient hospital AR process
- Hospital accounts receivable challenges
What is hospital accounts receivable services?
You can consider hospital AR as the pending invoices or delinquent accounts. You must implement a robust hospital accounts receivable strategy to ensure healthy cash flow so that you can provide quality patient care without encountering any financial obstacle.
Impact of efficient hospital accounts receivable management
You must handle your hospital accounts receivable efficiently to ensure a seamless cash flow for your practice. It involves having a strategic approach of billing, handling claims, and following up. If you efficiently manage AR, you can receive maximized and timely payments from insurance companies and patients. You should always keep a proper track of constantly evolving insurance regulations, and stays up-to-date with healthcare compliances.
Overview of an efficient hospital AR process
Many mid and small-scaled hospital lose a hefty amount of revenue due to poor accounts receivable process, however, you can still manage your AR efficiently by following the steps mentioned below-
1) Establish a clear terms:
At the beginning of the process, you should definitely determine if you want to extend the line of credit for a new patient. Of course, you need to check the credit history of that patient and based on that you should decide the credit line. You must clearly define your payment terms, expectations, deadline and other relevant information.
2) Collect proper invoice information:
For creating an accurate invoice, you must gather critical information that includes rendered services and treatments, exact deadline, etc. Any mistake any gathered information makes the invoice incorrect, thus causing further payment delays for your hospital.
3) Sending invoice to patients or insurance companies:
you need to send that invoice to your patient or their insurance company after creating the invoice. You can send invoice either in paper form or digitally via email or fax.
Payment tracking: It is a crucial method where you need to track each payment manually, using a consolidated spreadsheet. Though, it is always recommended to use an advanced automated system to track invoices to avoid any mistake in payment tracking.
Hospital accounts receivable challenges
The unique and stringent requirements coming with hospital accounts receivable services can make things challenging for you, leading your hospital to encounter hampered cash flow. Following are the major hospital accounts receivable challenges that you must be aware of-
1) Complex nature of hospital billing and insurance claims:
Managing hospital accounts receivable services involves handling the complex details of billing and insurance claims. Each patient interaction involves dealing with many billing codes and different insurance policies, making the process tricky and more vulnerable to mistakes.
2) Delayed payments:
Delayed payments from insurance companies and patients can cause big cash flow problems. The gap between providing services and getting paid can put a strain on your financial resources.
3) Substantial operational costs:
Managing accounts receivable, especially with denied claims and follow-ups, can be expensive. These costs can lower the overall profitability of healthcare providers.
4) Limited modes of payment:
Limited payment options can slow down revenue collection. Offering more payment methods and using modern, flexible solutions can improve the patient payment experience and speed up the revenue cycle.
5) More out-of-pocket for patients and bad debts:
Uncollected debts and financial strain on patients are major challenges. To ease these issues, you can use strategies to reduce bad debts and provide financial assistance programs. This helps both providers and patients manage their finances better.
Now you might be feeling worried after knowing about all the challenges mentioned above, isn’t it? Worry not as you can still avoid these challenges and reduce AR backlogs in hospital by hiring one of the best hospital AR outsourcing companies. A hospital AR management company can efficiently reduce hospital accounts receivable days with the most effective hospital AR collection strategies.
