Medical Accounts Receivable
The overall goal of the medical accounts receivable management is to achieve the shortest collection period as possible. Medical accounts receivables, also known as patient accounts, refers to revenues generated but not yet collected. To ensure cash flow is sufficient for effective management, the medical office has the responsibility to maximize its revenue potential. Successful medical accounts receivable management requires a full understanding of how each area or department relates to and influences the revenue cycle and the AR collection period.
Legal concepts include understanding and following state and federal regulations. The area that has always been of the most concern is fraud and abuse especially with regard to Medicare, Medicaid, and other federally funded programs.
Fraud generally refers to willfully and knowingly billing medical claims in an attempt to defraud any federally funded program for money. The most common forms of fraud and abuse include billing for equipment never provided, billing for services never performed, up-coding charges to receive a higher reimbursement rate, and un-bundling charges. The Office of Inspector General (OIG) has designed and issued special fraud alerts to the health care provider community. These alerts were intended to publicize the national trends of fraud to the general public. It is also a way to provide insight and awareness on fraudulent practices within the industry and address violations specific to the Medicare and Medicaid Anti-Kickback Law.
Contract negotiation involves developing a financial relationship with managed care organizations. Managed care organizations represent up to 50% of the net revenue of most medical offices. Negotiating managed care contracts requires comprehensive knowledge of the contracting process. This generally includes reimbursement rates, effective and termination dates, claim filing guidelines, payment terms and other contract provisions.
To help reduce your claim’s time in AR, state payment laws legislate the number of days in which a payer must pay a clean claim. Payer contacts usually have prompt pay clauses, as well. Your billing software can help you keep track of how long a claim has gone unpaid by giving providers access to a number of reports. One of those is theaged collection ledger. This report reflects the individual payers and the patient accounts that are associated with each payer. The report also indicates the age of the account in number of days; 30 days or less, 31–60 days, 61–90 days, 91–120 days, and so on. The report also shows the number of days allowed in AR per payer.
Once your medical accounts receivables go beyond 120 days Medcare Solutions can help you turn these aging medical account receivables into positive cash today!
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