Accounts receivable clean-up is more than a routine exercise—it's a necessary intervention for practices drowning in unresolved claims, aging balances, and the frustration that comes with them. When A/R spirals out of control, it doesn't just affect your cash flow. It impacts every corner of your practice, from staff morale to patient satisfaction.
Signs Your A/R Needs a Clean-Up
Not sure if you're in the weeds? Watch for these red flags. First, aging claims. If 20% or more of your A/R is over 90 days old, it's time to take action. The longer a claim sits, the less likely it gets paid—simple as that.
Another sign? High denial rates. If you find that more than 10% of your claims are getting denied, something's off. Whether it's incorrect coding, missing information, or payer-specific quirks (we're looking at you, Blue Cross), something is causing these denials to pile up.
Are your staff spending more time on hold with payers than resolving claims? This is another indicator. Every minute on hold is a minute not spent on revenue-generating activities. Staff should be working claims, not waiting to ask why a claim was denied for the fourth time.
The Clean-Up Process
So, you're in trouble. Now what? Start by identifying problem areas in your claims process. This means diving into your data. Look at your biggest payers and the common reasons for denials. Is it coding errors? Missing documentation? Work through these first—low-hanging fruit.
Next, prioritize. Not all claims are created equal. Focus on high-dollar amounts and high-frequency denial codes. Tackling these will give the biggest immediate return. Think zeros and ones—$10,000 claims before $100 claims.
Once problem areas and priorities are set, it's time for the grind. Begin reworking denied claims with a focus on accuracy and completeness. Provide all necessary documentation upfront. Double check codes. And for goodness' sake, ensure patient information is correct. Providers often overlook the simple stuff.
What about those old claims? The ones languishing in the 120+ days column. Decision time. Evaluate the probability of payment versus the cost of pursuing it. Sometimes writing off a claim is more strategic—know when to cut the cord.
Expected Outcomes
A clean A/R isn't just about the dollars. It's about efficiency. Practices can expect a drop in denial rates and an increase in collections within a few months post-clean-up. A healthier A/R also means fewer claims getting stuck in perpetual follow-up.
Improved processes lead to quicker payments, freeing up staff to focus on patient care and satisfaction. Staff morale gets a much-needed boost too. No one likes the headache of constantly dealing with chaotic accounts. A streamlined process makes for a happier, more productive team.
And let's not forget the bottom line. With cleaner A/R, practices typically see a 20-30% increase in cash flow. That's significant. It's the difference between just getting by and having the resources to invest in growth and improvements.
Moving Forward
An A/R clean-up isn't a once-and-done exercise. It's an ongoing commitment to maintaining a lean, efficient billing operation. Regular audits and process improvements should be baked into your practice's routine. Stay vigilant about denial patterns and payer changes. Pay attention to payer portals (we all know how "fun" they can be) and keep your team trained on any updates.
In an industry where the only constant is change, staying on top of your A/R is one thing you can control. Keep it clean, keep it efficient, and watch your practice thrive.
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