Why accounts receivable follow-up and claim denial management is important
The top reasons for medical claim denials include:
— Inaccurate patient information
— Missing patient information
— Inconsistent information
— Insurance eligibility
— Benefits exhausted
— Provider out of network
— Missing pre-authorization
— Coding errors
— Claim not filed on time
— Duplicate claim submitted
Denials are clues that can reveal issues with your workflow. Determine how you can improve your clean claims rate, and you’ll figure out how to improve your A/R.
Whose workflow is it anyway? The front office
The front office has a lot of potential to impact the clean claims and denials rates and, therefore, the A/R.
Whether you’re a billing company or a practice that manages billing in-house, you’ll need the partnership of the front office staff to reduce denials.
There’s no need to discuss every denial, and doing so can lead to an antagonistic dynamic. Instead, keep an open line of communication and transparency, and share weekly reports highlighting any inefficiencies.
The front office staff can take a few simple steps to start impacting clean claims. They can:
— Confirm patient information before the start of the visit to correct inaccurate, missing, or inconsistent patient information.
— Add or verify pre-authorization.
— Confirm insurance eligibility, whether the patient has exhausted their benefits, and whether the provider is in or out of network.
Whose workflow is it anyway? The provider(s)
The provider is also part of ensuring claims are clean, and can also benefit from clear communication with billing staff around denials.
“Keeping an open communication with your front office staff and partnering with your providers as well as your office admins will drive down those pain points, those inefficiencies,” Allison said.
Like the front office staff, the provider has the opportunity to confirm the patient’s information. The provider is also responsible for selecting the appropriate CPT code(s) for a given date of service, including for making sure that the codes accurately reflect the care the patient received and, if applicable, are bundled correctly.
Whose workflow is it anyway? The billing office
Where there’s a dedicated coder, the coder double checks that the provider has used the correct CPT codes. Billing office staff have a final chance to make sure that patient information is consistent. They’re also responsible for filing the claim on time and ensuring it isn’t duplicated.
How do I lower my accounts receivable (A/R) in medical billing? Start with patient collections
Patient collections were just 12% of healthcare revenue in 2019, but were 34% in 2022, Allison reported. This revenue cycle shift means improving patient collections will help improve your A/R.
Here are 3 steps to take.
1. Establish a written financial policy
A transparent, consistent, and defined financial policy can alleviate both A/R issues and patient frustration. Consider creating a policy that addresses the following issues:
— Co-pays/deductibles. Will you collect before a patient sees a provider or send a patient statement afterward? Does a high deductible impact when or how you will collect payment?
— Insurance billing. Who is financially responsible if a claim is denied?
— Referrals and pre-authorizations. Are these the patient’s responsibility to obtain or the front office staff’s responsibility to verify?
— Patients without insurance (self-pay). When will you collect a payment, and what schedule is acceptable?
— Missed appointments. Is there a fee for missed appointments? How far in advance can patients make changes to their appointments?
— Returned or NSF (not sufficient fund) checks. What is your policy when payment doesn’t go through?
— Copies of medical records. Do you bill for medical records or copies?
— Payment plans and outstanding balances.
— Any fees added to services. What are these, and how will you communicate them to patients?
Consistent collection procedures will improve internal and external communications as well as A/R. Staff will know what to collect, and patients will know what to expect because the practice has a written financial policy.
2. Automate patient statements and payment options
Automating patient statements, and offering a variety of payment options, will help improve A/R by making it easier for patients to pay and for the practice to collect.
It will also save your front office time spent following up. With automated statements, depending on your chosen solution, you might send out email statements within a certain time frame of a balance appearing in a patient’s account.
SMS text and email reminders, delivered automatically on a predetermined schedule, can help to drive online payments. So can paper statements that include QR codes to enable online payments. Some services offer delivery reports, broken down by medium.
However you choose to automate your patient statements and payment options, doing so will streamline your collections, making them more convenient for you and patients.
3. Establish a written collections process
Where your written financial policy is the agreement between the patient and the practice, your written collections process describes how patients will be treated according to what category they’re in and where they are in the collections process.
Having a written policy for each step of the collections process will improve internal and external communications, as well as cash flow.
Key takeaway for medical billing accounts receivable (A/R)
To improve medical billing A/R, adopt a two-pronged approach where you reduce claim denials on the one hand, and improve the speed of patient collections on the other hand.
In both, examine your existing workflow to identify inefficiencies, look at denials to identify places for improvement, and seek ways to automate and streamline.