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Four Essential Steps to Improve Accounts Receivable

If your medical practice accounts receivable is sapping your profitability, you may need a billing makeover.  And if you’re not sure where to begin, consider enlisting the services of a company that specializes in medical billing management. Chicago Lake Shore Medical Associates, a multi-specialty physician group with 43 physicians, partnered with RMK Holdings’ medical billing team, to improve its days in accounts receivable (A/R) by 34.5%, resulting in improved cash flow.

Chicago Lake Shore was experiencing A/R of 55 days when RMK took over its billing. Initially, the practice was sending out bills once a month rather than weekly.  One third of its electronic claims had to be rebilled because of incorrect insurance or incomplete information.  RMK realized the office staff scheduling appointments was simply too busy to accurately record information.

The hectic pace a front office staff experiences often makes it difficult to verify insurance information and patients themselves can easily be confused by changes in their insurance plan. Once these problems were identified, the following steps were taken to implement and improve Chicago Lake Shore’s A/R:

  1. New patients should contact medical billing. When all patients called for an appointment, the staff booked the appointment, and requested that the new patients, as well as patients not seen in several months, contact RMK’s insurance verification department to update their insurance and demographic information. This practice alone decreased rebilling dramatically.
  2. Use batch eligibility verification. While initially this (Step Number 1) reduced a lot of the rebilling issues, too many claims were still not up to RMK’s accuracy standard. To improve claims submission, RMK shifted to a batch eligibility verification system that would begin two days before each patient appointment. With batch eligibility, a list of all patients and their information is submitted via an electronic file to each insurance carrier for that day. A report is then returned, showing each patient’s current coverage and eligibility status. Inaccurate information was immediately corrected or updated in the patient’s record by RMK. Moreover, the client and patient were provided with current deductible and coinsurance information along with well coverage information prior to the appointment. This enabled Chicago Lake Shore to reduce incorrect claims submissions by 98%.
  3. Call patients with long past due balances before their next appointment. Chicago Lake Shore Medical Associates and its medical billing partner also implemented a program to call any patient with a 90-day past due balance prior to their next scheduled appointment to arrange payment options. The physician’s office is notified via email if the patient states they will pay at the time of service, and if the patient is unreachable by phone, a notice with that patient’s past due balance is forwarded to the physician’s assistant. The assistant is also notified if the patient promised to pay at the time of service.
  4. Offer credit card or online bill pay.  Finally, patients were given the choice to pay online with the option of storing credit card information to collect deductibles, coinsurance or past due amounts automatically.

According to RMK’s CEO Ron McLaughlin, when providers clearly inform patients about their financial obligations in advance, patients are more likely to fulfill their responsibility and the practice’s profitability or cash flow is more likely to be optimized.

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