ar recovery

If your healthcare system is getting overwhelmed by rejections and denials, it is time to improve your AR medical billing. An AR recovery warrants actively thorough management of your RCM (revenue cycle management). Healthcare practices lose a tremendous sum of revenue by not being able to pay timely attention to denials and unpaid claims. In their aim to establish an efficient medical coding and billing system, medical practices use AR recovery to prevent any occurrences of missed revenues.

While AR medical billing remains a methodical approach to boosting your practice’s revenues, the process itself requires a good amount of labor. If you are unable to deal with the claims on a closely monitored timeline and fail to notice your aging AR buckets account receivables starting to pile up, we suggest outsourcing your AR workings to a specialized RCM company. But first, let’s understand what is AR in medical billing?

What is an AR in Medical Billing?

Accounts receivable in medical billing is the money owed to healthcare systems or companies associated with medical billing to cater to the patients utilizing the medical facilities. In simpler words, AR is the pending reimbursement, to which the providing facility is entitled to. Either the patient himself or the insurance company covering their expenses is responsible for this reimbursement.

For example, when a person undergoes treatments and avails services at a healthcare facility on credit, the amount owed to the providers is systematically added to the patient’s accounts receivable.

After a specific duration of outstanding AR, around 120 days, the providers are less likely to receive reimbursements. In most cases, the compensations are expected to be around ten cents on every dollar owed.

The AR cycle is initiated once the healthcare provider bills the patient or their insurance company. An internal or an outsourcing team classifies ARs typically according to their age:

  • 1 to 30 days
  • 31 to 60 days
  • 61 to 90 days
  • 91 to 120 days

Categorizing AR revenues according to their age makes it easier to collect reimbursements in due time without risking revenue loss. The loss of revenue in such situations is termed revenue leakage, where the provider is not reimbursed for the care issued.

What is AR Recovery in medical billing?

‘What is AR in medical billing?’ is a frequently asked question, which is often confused with AR recovery. While AR is the numerical amount of unpaid dues to the provider, AR recovery is the process of following up with the patient or their insurance company until the dues have been cleared.

AR recovery is an important aspect of medical practice. With effective denial management and an AR recovery team, you can improve your medical billing system. A prompt follow-up to insurance companies allows easy reimbursements without aging claims. The longer the AR claims are in the aging group, the less likely the provider is to receive outstanding debts. AR medical billing ensures a productive monthly reporting system, hence paving the way to a progressive revenue for the practice.

ar medical billing

AR Recovery Done the Right Way

One of the most effective approaches to improving the accounts receivable is a thorough evaluation of your processes. It is imperative that the process negligence to not go unnoticed by the practice manager or the CFO. Acknowledging and effectively rectifying this negligence reduces the risks of accumulation and aging of ARs. The four ways to eradicate the possibility of revenue leakage is to execute your AR recovery process the right way.

Make no errors

It is important to get your AR medical billing right in the first go. Collection of patient information and submission of correct claims should be ensured by your team of professionals. Critical assessment of the risks of inaccuracies in the first attempt avoids insurance claim denials and aging AR cycles. To collect the billed claims most efficiently, you need to have the proper groundwork to start from. A clear record of patient registration and scheduling provides the groundwork required.  

Collect Patient Portions Promptly

The possibility of any delinquent payments can be avoided if the patients are provided a maximum amount for financial responsibility from the medical care provider’s end. This should be brought into light ahead of the patient’s scheduled visits so he/she can arrange to meet the financial responsibility.

Both the provider and the patient should make an individual effort to clear dues. The provider needs to ensure the collection of the dues before the patient walks out of the healthcare facility. According to statistics, providers are 20% less likely to receive patient reimbursements that are not immediately collected.

Prompt recovery of the patient’s dues efficiently continues the AR cycle. This way, the AR medical billing is carried out without any hitches and little to no revenue is lost. Furthermore, the providers should work to establish a convenient schedule that eases the AR follow-up on any partial payment offered by the patient.

Charge Entry

Charge entry in AR medical billing is the process followed by healthcare practitioners to submit the fully detailed list of services availed by the patient. These are later coded for claims submission. Various medical services are coded differently, to make it easier to keep a track of one another. Charge entry must be carried out most professionally, with no errors. It is estimated that around 1% {my comment, verify?? 1% seems very low number} of incorrect charge entries in AR medical billing arise due to discrepancies between the bill served and documented in reports.

what is ar in medical billing

Claims Submission

Claims need to be submitted to the patients/payers once the charges have been captured and coded for. Ensuring an error-free charge entry is essential to avoid claim denials and AR aging. To file the submission of a claim successfully, the providers must oversee the patient’s insurance information and verify whether their insurance coverage is active or expired. In addition to this, it is important to ensure that the insurer receives the correct bill with the full list of expenses from the healthcare providers.

AR Tracking

Running reports to establish an average AR cycle is an important step in AR recovery. This determines whether there is a delay occurring between provisions of care and invoicing at the healthcare facility. Starting your AR cycle as soon as possible reduces the risks of forgetting outstanding dues, which then go unpaid.

When you track your accounts receivable frequently, you can prevent them from aging. It allows providers to attain the necessary information required to identify any risks associated with medical billing. These, if go unnoticed, may lead to leaked revenue and bad debt.

Outsourcing AR Recovery

With small practices, hiring a few professionals for your team of AR medical billing may be fruitful on its own. However, if you are running a larger healthcare practice, it is best to outsource your AR recovery to an experienced and skilled team of professionals.

This functionally takes the burden of funding for an on-premises revenue cycle management system off your shoulders so you can focus on other spheres of running your practice. With a team known for its expertise in the nuances of your work, you will be able to largely reduce errors and maximize revenue.

See Also: The Key Points For Billing And Coding Critical Care Services You Should Know

At Precision Hub, we understand and take pride in the trust that our clients put in our medical and coding expertise. By outsourcing your medical billing and AR recovery sectors to us, you will be able to grow your practice in terms of finance and improved patient-centered care. Contact us today if you are looking for technology-driven RCM and AR Recovery consultants.

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