06 Feb AR and the Importance of Timely Payment Posting
Most dental practices carry an accounts receivable (AR) balance, but the amount and age of AR can vary greatly. As you know, accounts receivable is the money that has been billed for services rendered, but hasn’t been collected yet. We’ll look at ways you can identify problem areas and minimize the impact of aging accounts on your revenue cycle management (RCM).
Dental Practice Aging Report
An accounts receivable report showing how much money is due to the practice based on how long the group has been waiting for a claim or co-pay to be received.
Analyze Your Aging Report
While it’s normal to carry a certain amount of AR due to processing time for commercial insurance and government payers (e.g. Medicaid), your accounts receivable aging report can provide good insight into cash flow bottlenecks for your dental practice.
Groups that carry a heavy load of 90-day AR balances are essentially serving as a bank for the insurance carriers and patients. Instead of having access to the revenue you’ve earned, you’re missing out on opportunities to use those earnings to pay for operational costs or make investments that could generate interest.
Digging into your AR aging report can help you identify trends that are costing you money:
- Are certain insurance carriers slow to reimburse?
- Are you experiencing a high level of claim denials?
- Do you verify benefits and provide patients with anticipated co-pay amounts?
- Have you communicated your payment terms (at time of service, net 30 days, etc.) to your patients?
- How do you handle out-of-network billing for patients?
- Does your team have an efficient process to submit accurate claims?
- Is your staff too overwhelmed to submit claims on a daily basis?
- Does your staff immediately post payments in your practice management software (PMS)?
The Impact of Payment Posting
Although it’s a tedious task, it’s very important to log payments into your dental billing software and reconcile those postings with deposits and electronic fund transfers (EFTs) as soon as possible – or internal delays due to inefficient processes.
Not only does this help keep your accounting records clean and organized, having those payments posted makes your AR aging report more meaningful because the data is current. It will help you identify payment trends, including lags from certain commercial or government payers.
In addition, if patient payments are correctly posted, it will reduce (or eliminate) embarrassing collections calls to patients who have already made payments that haven’t yet been accounted for in your billing system.
AR and payment posting work together hand-in-hand as part of your overall revenue cycle management. If either part of the process is missing or inaccurate, it prevents you from seeing a clear picture of your practice’s financial position.
Although this is essential, ensuring timely payment posting and accurate AR aging requires a time commitment and expertise your office staff may not have.
The Partner Paradigm Shift
If you’re thinking about outsourcing billing due to your team’s lack of time and experience, you may want to consider “insourcing” – this approach functions like a partnership, with total transparency, access and support. This is exactly where Medusind dental billing services excel.
The Medusind “technology + team” approach is built upon industry-leading technology combined with experienced RCM specialists. Our dental billing professionals complete robust, ongoing educational requirements to ensure they’re always working with the most current information about payment models, billing codes and procedures. Our support staff includes actual humans that are available whenever they’re needed.
Like all Medusind dental billing services, our AR and payment posting services are designed to help reduce administrative burdens on your staff, lower costs, increase revenue and help your practice grow efficiently. In addition to our AR and payment posting services, we also offer:
