Over time, one would expect financial management of a medical practice to become more streamlined and simple. With the abundance of electronic tools, software programs, and the Internet, you can find assistance and problem-solving strategies for economic efficiency. In the rush to take advantage of these support tools, basic facets of financial management, such as billing and collection, have fallen by the wayside.
Re-evaluating the basics of billing and collections is a good first step for rheumatology practices that want to get their finances in order. Rheumatologists should reacquaint themselves with financial methods to see how their practices are performing. An analysis of accounts receivable (A/R) begins with these three financial elements of each patient/payer transaction:
- Charges: Full fee amounts for the services provided;
- Adjustments: Amounts deducted per contractual obligations—usually with HMOs, PPOs, and other payer-plan participatory obligations; and
- Payments: Amounts paid to the practice by patients and payers (receipts).
Every practice should have financial transparency. Detailed reports should be generated on a timely basis each month, as well as at the end of the year, via the practice’s billing system. The report module of the billing system should allow for flexibility in report generation so that both high-level reports and detailed listings, down to patient account levels, can be created. The reports should analyze a variety of data in different ways, but physicians should target one or two specific reports on which to focus when collecting outstanding balances. The most common reports to begin the collection process are:
- A/R reports of high-level accounts;
- A/R reports with categories for accounts current, 30 days, 60 days, 90 days, and 120 days or more past due, with billing staff notes detailing account work;
- A/R by insurance type (i.e., by payer, including self-pay patients);
- A/R by suspended, pended, or unbilled accounts (this report ensures no accounts remain hidden during the reporting process); and
- Accounts written off to collections (typically those more than 120 days past due, unless the claims fall under untimely filing of claims, etc.).
For more information about accounts-receivable and practice-management issues, contact Antanya Chung, director of practice management, at (404) 633-3777 ext. 818 or [email protected].
