You know how important hospital accounts receivable is for your billing—it’s a big deal because your hospital’s revenue depends on it. But let’s be honest, managing AR isn’t easy. Hospitals have so many specialties, and your main focus is always on patient care. Still, you can’t skip the administrative side, especially when it comes to your accounts receivable.
If you want your hospital to stay financially healthy, you’ve got to manage your AR services the right way. It’s super important to understand how hospital AR works before diving into the challenges, the follow-ups, and all the other little details that keep things running smoothly.
Always remember, accounts receivable is how you keep money flowing into your hospital. It’s the payments patients and insurance companies still owe you. You’ll also find it includes unpaid bills or accounts that are overdue. Basically, your hospital’s accounts receivable is a fancy way of saying “pending invoices” or “delinquent accounts” that need attention.
The truth is that managing your hospital accounts receivable can be a challenging affair for you but you can actually make a big difference based on the manner you handle it. If you know how to handle the days in AR right, you will be able to ensure a stable financial foundation for your hospital.
Navigate the days in your hospital accounts receivable services:
You need to submit your medical claims fast—within 72 hours after giving a service. When you send clean claims electronically, you could get paid in about two weeks. The fact is that things do not always go as you have planned. Just imagine a situation where you are running a healthcare practice in New York but you have been waiting for more than six months to get paid for several of the provided healthcare services. Did you know the fact that in 2022, the majority of mid and small-scaled healthcare practices across the nation lose almost $100 million worth of aged claims aged more than six months older? You must know how to handle AR management efficiently so that you can always receive payments in a timely manner.
You know how frustrating it is when your payments are delayed and overdue bills keep piling up. That’s when your days in AR—how long it takes for your claims to get paid—start growing. It is always crucial for you to track your “days in AR” to determine effective ways to improve it efficiently.
You can figure out your days in AR by dividing your total accounts receivable by your practice’s average daily charges. You always aim to keep your AR days under 50, especially when you are depending on your internal administrative team but you will be able to reduce your overall AR days down to 30 to 40 days a hospital accounts receivable outsourcing company. You can always figure out the average days it takes for you to collect payments from your patients and their insurance companies.
This helps you improve your collections and keep your revenue cycle strong, like making sure you’re always on top of your homework!
You really need to know the frequent challenges that always lead your healthcare practice to encounter increased days in AR.
Frequent challenges with hospital accounts receivable management:
You need to know the 3 most common challenges with hospital accounts receivable services if you want to handle them the right way. When you understand these problems, you can create a plan to fix them and keep things running smoothly. It’s like knowing the tricky questions before a big test—you’ll be ready to tackle them!
1) Navigate the complex nature of insurance claims:
You have to deal with a lot to manage your hospital accounts receivable the right way. You need to understand the complicated world of medical billing and insurance claims. That means you are handling tons of medical codes and following all the claim submission rules, which can get pretty tricky for you.
2) Poor cash flow:
You might have already realized how frustrating it is when payments from patients and insurance companies take longer time than expected and no wonder it is one of the vital reasons why the majority of healthcare practices struggle with cash flow issues The more gap you have between submitting the invoices and getting paid, the more headache you will face with managing your accounts receivable.
3) Compliances and regulation bottlenecks:
Always know the fact that the healthcare industry has a lot of rules and regulations. You need to follow these laws and policies if you want to collect payments the right way. It’s like making sure you follow the rules in a game so you can win!
You can always avoid cash flow disruptions and ensure timely payments by implement a robust hospital accounts receivable management process. However, you can actually streamline a perfect AR process and drastically improve your overall cash flow by outsourcing your AR process to a professional hospital accounts receivable company as they know how to drastically improve your collection and practice’s revenue.
