40-50 days for an Average performing Medical Billing Department.30 days or less for a High performing Medical Billing Department.We look at the following figures as benchmarks for medical billing and collections: Some HMOs pay claims at 45 days after receipt, the time allowed by law in some states. So is that good? Well, Medicare usually pays about 14 days after receiving a claim. It is taking an average of 45.5 days to collect your payments. Then, if your total accounts receivable is $70,000, the Accounts Receivable Days is 45.5. Total AR / average daily charges = days in ARįor instance, if you have charged $280,000 in the past six months, and if there were 182 days in those months, your average daily revenue is $1,538. Total charges for last 6mo / number of days in last 6mo = average daily charges The result is the Days in Accounts Receivable. Divide the total accounts receivable by the average daily charges.Compute the average daily charges for the past several months – add up the charges posted for the last six months and divide by the total number of days in those months.The first measure is the “days in accounts receivable” – the average number of days it takes to collect the payments due to the practice. Measuring Medical Accounts Receivable: “Days in AR” So, as a practice owner or manager, it’s critical to have a handle on your medical accounts receivable. It’s also part of the best practices in medical billing you need to implement, even if your cash flow seems adequate right now. In fact, it’s fairly easy to monitor the overall performance of your accounts receivable efforts, and looking at these measures each month can provide an early warning of potential collection problems – and the effect on cash flow. Medical Practice Revenue Cycle: a Best Practices Checklist No wonder physicians and other healthcare providers are skeptical and frustrated. So they fall back on generalities or dollar amounts with no context. One of the reasons straight answers are hard to come by is that many staff members responsible for managing the medical billing process don’t know the relevant benchmarks and metrics to use for measuring accounts receivable performance. When we ask questions about medical accounts receivable, we usually get answers like, “Oh, our AR is very low!” or, “Our AR is $XX”, with no way to tell if that’s good, bad, or ugly. And the corollary: “Why can’t I get a straight answer to that question from the office manager/administrator/billing supervisor?” One of the most common issues we confront when called to perform a physician billing department assessment, or a more broad-based medical practice analysis, is the lament: “Why aren’t we collecting more of our accounts receivable”.
0 Comments
Leave a Reply. |