Implement some techniques in your medical practice to lower your
Days in AR (DAR), collect more money and get paid faster.
Days in Accounts Receivable, also known as Days in AR, refers to the average number of days it takes a practice to collect payments due. Reducing your Days in AR can help you collect your medical practice’s payments faster and make sure you are getting paid for your work.
At Health Prime we use the formula: AR bucket divided by the average daily charges for a given period of time. On Datalytics, our business intelligence platform, we use 91 days’ worth of charges, so the formula for this metric is best represented as:
Accounts Receivable /
Charges total for the past 91 days / 91
According to the American Academy of Family Practice, the average industry objective for DAR is less than 50 with better performing practices between 30 and 40.
At Health Prime, we manage internal benchmarks above the industry ones so medical practices can focus on best practices to run their businesses. Our benchmarks are tighter than the industry average. Health Prime’s benchmark baseline for DAR is 28 days.
Teamwork is essential
Your front office and back-office staff should work together smoothly to lower the number of days it takes your medical practice to get paid.
Your front office people have to check eligibility and benefits carefully, collect your copays and outstanding balances, get the correct insurance information and more. They need to verify all the information so the claim will go to the payer in the first pass without an issue. This is known as a clean claim.
Your back-office team will have to make sure those claims are going out clean. They need to verify that the information sent by your front office staff is correct. It’s also important to validate coding combinations and any required authorizations. If not, the clearinghouse will send it back demanding more work from your team on appealing that claim and getting paid for your money.
Best techniques to reduce your Days in AR
- Have good controls in place at your front office: Monitor your front-office staff duties and relieve their administrative burden so they can focus on patient satisfaction and collecting your money at the front door. If you want to know more about it, read our blog: Improve your front desk processes with these best practices.
- Verify eligibility and benefits: Your front-desk staff should verify this information before the actual visit by checking if the insurance is active, if the patient has copays and has met their deductible, and if you have the right primary insurance. Don’t forget to confirm your practice is considered in network for the patient’s plan. This is done by validating with the payer either by a call or through a portal. When scheduling a patient, check eligibility and benefits a day or two before the actual visit, especially if the date of scheduling and the date of visit are distant from each other.
- Automate your PMS (Practice Management System): Many softwares have automated ways of doing eligibility and benefits. Make sure your medical practice is optimizing the use of your PMS and use every feature available according to your medical practice needs.
- Make sure you collect upfront balances dues: Your front desk staff must be confident collecting copays, deductibles, and any outstanding balance at the time of visit. Also, be ready and know patient copays ahead of time.
- Submit your claims within 4 days: The sooner you get the claims out, the better. Do this process as quickly as possible so the insurance company can verify the information. If it’s not a clean claim, it will give you more time to send an appeal and get paid for your work.
- Handle all claims and get your payments electronically: Handling all claims electronically speeds up the process of handing the claims to the insurance company to process and pay. Also, getting your payments electronically can help you get your EOBs (Explanation of Benefits) and payment information faster so you can post your claims sooner.
- Timely work on your denials: Don’t let your denied claims sit around. Have someone from your staff constantly working, responding, appealing, and correcting claims. At HP we can help you with that. Our team will make sure your denials are being followed up, so your staff can focus on patient care and deliver outstanding customer experience. If you want to know more about how to reduce your denials, read our blog What are some simple steps to get your denials under control?
Monitor your Days in AR
Our RCM and analysis platform, Datalytics, will let you focus on your Days in AR metric to determine areas of improvement on your medical practice and monitor its overall health.
Compare your Days in AR against the industry standard and benchmark your metrics against our best practice. With its predictive modeling, Datalytics provides awareness of what your medical practice future holds. Notice trends in your practice and identify areas of improvement to lower down this metric.
On Datalytics, for Accounts Receivable you can analyze two key metrics in the dashboard: Days in AR and the percent of primary insurance over 90 days from the first billed date. With Datalytics’s drill-down capability, you will be able to see more information such as: Total AR, Insurance AR, and Patient AR. Also, a breakdown by Financial Class, aging buckets, or even claim level.
If you want to know more about which metrics you can monitor with Datalytics to enhance your processes and improve your medical practice, read our blog: Datalytics: the RCM platform you need to know about.
Let us help!
At Health Prime, we can help you reduce your Days in AR and improve your RCM so you can get paid faster for your work:
- Optimize the way you use your PMS: get training for your medical practice to improve the way you are utilizing your practice management system for the benefit of your practice.
- Enroll as many payers as possible for electronic claims: you don’t have to print your claims. We take care of electronic claims for you.
- Enroll direct deposits or Electronic Funds Transfer (ETFs): Get that direct connection to the payer ensuring to get your money faster.
- Process your claims as soon as they are given to us: we get your claims out as soon as possible. Our expected turnaround time is 48 hours once we get it as long as the claim is clean. We make sure you get your payments posted quickly.
- Dive deep on your claims: in case the claim was denied, our team will reach out to your front-office staff to determine the incomplete or inaccurate information, correct it, send back the claim, and appeal it if necessary so you can get paid for it.
- On Patient AR standpoint, we:
- Build statements.
- Send patient statements out regularly.
- Answer patient questions about their bills and encourage them to pay.
- Make arrangements for payment portals. This can help patients’ payments. They’ll have a balance reminder on their phone so they can pay electronically their bill.
If you want more information about how you can reduce your Days in AR and improve your medical practice processes, feel free to email us at firstname.lastname@example.org. Set up a meeting with us to discuss how Health Prime can help you achieve your goals.
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