According to a recent article in Physicians Practice, many practice owners do not project or even know what their monthly receivables will be. It’s quite common in the industry that the responsible parties for tracking revenue keep their fingers crossed and hope that payments will continue to come in. There are no set financial expectations or goals.
Many people feel frustrated and overwhelmed by the reimbursement process and believe that payments are strictly in the hands of the insurance companies with little opportunity to improve the situation. That is not an effective way to run a business.
If you don’t know what money is coming in or expected, how can you run a profitable medical practice?
In addition to the importance of projecting monthly cash flow, the writer suggests the following tips to help the practice get paid as quickly as possible:
- Complete notes that will be charged out on the same day the patient was seen. The longer you delay, the longer it takes to bill and the longer it takes to get paid. Timely completion has a direct correlation to receiving faster payment.
- Bill claims out every day.
- Post payments the same day they are received. This will help you understand the habits of the various payers and help to develop your follow-up processes based upon payer trends
- Medicare has 14 days from the time they receive the claim to pay it. If you have any Medicare A/R over 30 days, that’s a problem you need to resolve.
While these suggestions are good practices to implement, the bigger issue still remains: If you don’t have financial goals, how will you manage your cash flow?
As Revenue Cycle Management (RCM) specialists, we know the importance of consistent cash flow to a practice. At AssuranceMD, we develop annual financial projections for every client that are tracked and reported down to a daily level. As a result, our clients have greater financial control because of consistent reporting and improved cash flow.
The standard protocol for any new practice engaging in our RCM services is to complete a Practice Profitability Portfolio. This financial assessment benchmarks the practices performance against industry standards established by MGMGA and the Medicare allowable. It is a critical component that helps us to identify gaps between actual payments and reimbursable receipts, opportunities to improve the billing process and to establish the upside financial potential. Our benchmarking analysis creates an important roadmap to develop financial goals proven to increase financial performance.
It is no secret that on average, doctors collect 30 cents on every dollar they are entitled due to inadequate collections processes and inaccurate billing procedures. When managed professionally, improvements in these two categories can contribute to a 25% revenue increase. If you aren’t managing your financial projections or cash flow with a particular goal in mind, you are leaving hard earned dollars on the table. We can help you to turn that around and collect all that you are owed.
If your cash flow is not consistent, we can help. Contact us today to schedule a free consultative call about managing cash flow.