Four Metrics To Help You Find Money in Your Practice
The revenue cycle is one of the most complicated and intimidating parts of the medical practice and it is very important for physicians to ensure that they are on top of the process. That being said, there are metrics that can make this much less daunting and help present the areas that need attention. Here are four that every practice should be watching.
Days in Accounts Receivable:
Days in accounts receivable is the average number of days it takes to collect payments due to the practice. The larger this date, the larger the delay in payment, which can have detrimental impacts on the cash flow to the practice. It is important to track how long these payments take to collect because it can indicate issues within the process.
Percentage of Accounts Receivable over 90 Days:
Accounts receivable aging is important to track to ensure that the practice is being paid timely, filing claims appropriately, and denials are being identify to ensure they are worked. The percentage of Accounts Receivable over 90 days indicates overdue accounts that require some additional follow up, including sending to collections.
It is important to track the amount of money that your practice is actually collecting and depositing compared to the amount billed. It is important to look at the net collection rate, which factors in the contracted rates for insurance products. Low collection rates can be an indication of issues within the billing department, inaccuracies in the physician’s charting, or denials that are not being appealed or corrected.
Total Accounts Receivable by Provider:
It is important to track metrics by providers to ensure that each provider is carrying their weight. By tracking accounts receivable by provider, a practice can identify issues specific to each provider, mainly those who are not producing. If a provider is carrying their weight in activity or volume, it could indicate a larger issue with documentation.
It is important to track these metrics to ensure that both providers and billers are performing appropriately. These metrics can also be used an incentive for physicians (pay for performance) or to hold any outsourced billing companies accountable for their performance. Nolan Health Care Solutions provides services to help track these metrics and ensure that your practice is on track or in need of adjustments to collect appropriately and timely.