Performing an accounts receivable (AR) review is necessary to ensure a successful medical practice. Whether you have billing in-house or outsource this function, providers must perform thorough reviews. While you may be receiving monthly reports, these reports often do not provide a true pulse of the revenue cycle function or reflect broader trends in the healthcare industry.
An AR review performed by IHBS helps a practice gain a true understanding of its health and any process gaps. Often, providers look only at monthly revenue and don’t raise an alarm until the practice’s financial health is in decline. All office functions affect monthly revenue and, therefore, must operate at peak performance. This includes billing workflows, HIPAA compliance, and the relationship between accounts receivable and accounts payable.
While many management companies would just perform the review and provide a report, Innovative Healthcare takes it one step further. We understand that reports only go so far, and your success depends on implementing the solutions. Often, this is where consulting falls short. This is why our AR review also includes an additional training component. If we identify underperforming areas, we can also assist with training your staff on best practices. The training component will close the loop to ensure your practice sees the full benefit of the AR review, especially when outsourcing billing and revenue management services.
Why is an accounts receivable review necessary?
A medical accounts receivable (AR) review is a crucial process for medical doctors and healthcare practices, as it involves a comprehensive analysis of outstanding payments owed to the practice. It supports health care providers across different service lines, including diagnostic departments like radiological imaging.
Here are several reasons why a medical doctor would want to conduct a medical accounts receivable review:
- Identifying Revenue Leakage:
- An AR review helps medical doctors identify any potential revenue leakage within their practice. The AR review pinpoints areas for improvement, which can vary across medical specialties.
- Ensuring Billing Accuracy:
- Doctors often rely on billing and coding processes to receive timely, accurate reimbursement for the services they provide. Conducting an AR review helps ensure that billing and coding practices are accurate. This process will reduce the risk of claim denials or delays, including issues addressed by denial management. A strong understanding of medical billing procedures is essential here.
- Optimizing Revenue Cycle Management:
- A well-managed revenue cycle processes claims efficiently and ensures timely payment. It is essential for the financial health of a medical practice. Reviewing accounts receivable will help optimize the revenue cycle. Ensures that claims are processed efficiently and payments are received on time, including integration with systems like electronic health records (EHRs).
- Improving Cash Flow:
- Timely and accurate reimbursement is crucial for maintaining a healthy cash flow within a medical practice. By reviewing accounts receivable, doctors can implement strategies to expedite payment, improving cash flow and financial stability.
- Enhancing Operational Efficiency:
- Inefficiencies in the billing and collection processes can result in delayed payments. A thorough AR review enables medical doctors to identify and eliminate bottlenecks, streamline workflows, and enhance the practice’s overall operational efficiency. Tools and methodologies such as Lean Six Sigma can support continuous improvement.
- Improving Patient Relations:
- Delays in processing insurance claims and billing discrepancies can lead to frustration among patients. By conducting an AR review, medical doctors can identify issues that may be causing delays in patient billing, allowing them to address these concerns and maintain positive patient relations.
- Strategic Decision-Making:
- A comprehensive AR review provides valuable insights to inform strategic decision-making in a medical practice. Doctors can use the data e review to make informed decisions about staffing, credentialing, technology investments, and process improvements that align with trends in the healthcare industry.
A medical accounts receivable review is a proactive approach to financial management for medical doctors. By regularly assessing and optimizing their accounts receivable processes, physicians and administrators can enhance their practice’s financial health, improve operational efficiency, and ultimately provide better patient care in hospitals, clinics, and other healthcare settings. A focus on financial experience builds long-term sustainability in delivering care.