Handling Accounts Receivable in Your Practice: Common Issues and Solutions

#accounts receivable #balance booking #collections #insurance verification #outstanding claims #delayed payments

OVERCOMING THE CHALLENGES OF ACCOUNTS RECEIVABLE

Efficiently managing accounts receivable is crucial for the financial health of any dental practice.  Many dental practices need help in this area.  In this article we will explore the common problems with accounts receivable, and discuss practical strategies to use to avoid most issues.

Outstanding Insurance Claims

One of the primary problems behind accounts receivable in dental practices is outstanding  insurance claims.  These are claims that have yet to be processed, reviewed, or finalized for payment.  Also, claims that your front office has submitted, but they need additional attention, documentation, or details.  While their status is waiting for resolution, the claims typically remain pending.  As these claims continue as pending for an extended period, it becomes more challenging for your office to provide cost estimates to your patients.  Delayed claim processing also leads to delayed patient billing.  Your patients may receive statements and balances with varying amounts which can be frustrating and difficult to manage.

In addition, because of delayed billing your patients may experience delays in receiving necessary treatments.  When insurance claims are pending for a significant period of time, patients often wait for follow-up appointments in order to receive additional treatment.  These setbacks ultimately affect their oral health needs.

How to Avoid Falling Behind on Accounts Receivable

The solution is a system for tracking the progress of insurance claims.  Your team’s ability to follow up on outstanding claims expedites the decision making process.  This tracking system consists of two items: tracking the claim by the date it was submitted, and tracking the time elapsed since the claim was submitted.  Another key part to processing claims includes the approvals for payment. Once a claim is approved and the insurance payment is received, your staff should reconcile the practice’s accounts receivable.  This approach ensures that all payments are accurately credited to the corresponding patient’s account.

Next Level Consultants’ coaches have proven strategies to help your team excel in handling accounts receivable by introducing “Accounts Receivable Systems.”  By incorporating our processes and protocols, your dental practice will efficiently collect the money owed to you, and reduce the stress of running a business.  In addition, our proven system will enhance the overall patient experience because your patients value transparency and appreciate hassle-free billing. 

Inaccurate Treatment Plan Estimates  

Inaccurate treatment plan estimates stem from a variety of factors.  These factors include:  

1)  Incorrect data entry

2)  Insufficient knowledge of patient’s dental history

3)  Outdated insurance eligibility

4)  Failure to consider the provisions of insurance plans (such as missing tooth or replacement clause)

The above inaccuracies result in unexpected costs for your patients.  For example, your patient may receive a bill from the insurance company that is not the same as your office estimate. This in turn causes confusion and disputes.  A great deal of time and effort from your front office staff is needed in order to resolve billing discrepancies.  In addition, it is frustrating for your patients who are trying to understand their benefits and make payments.

It is important your staff is proactive and capable of explaining to patients what their dental plans are covering.  Your team members must review any limitations or restrictions that affect the patient’s out-of-pocket expenses.  By thoroughly explaining the limitations of the patients’ plans, it allows them to trust your recommendations for treatment.  

Your font office team should practice presenting treatment plans based on which procedures are part of the patient’s insurance coverage.  It is important to engage your patients when plans do not cover a procedure.  More importantly, decisions can be made with the patient’s full understanding.  Also, your office should discuss any waiting period stipulations, annual maximums, and pre-authorization requirements.

Front office team members can improve the accuracy of treatment plan estimates by ensuring that all patient information is up-to-date.  Your team should also be perceptive of any insurance provision changes, such as new insurance policies and/or regulations. Furthermore, establishing relationships with your patients, and their insurance companies makes for an excellent patient experience.

Getting Your Front Office Team Trained

If your team members are not familiar with dental codes and procedures, you may not be giving the best care available. Nonetheless, your patients should be taking advantage of all of the benefits insurance plans’ have to offer.  Patient treatment plans should include a descriptive breakdown of recommended procedures, their purpose, and associated costs. Additionally, it is important to make sure treatment plans are clearly documented in order to avoid misunderstandings. Everyone in the office should know the standardized codes for dental procedures (CPT or ADA) to facilitate accurate billing. 

In addition, encourage team members to speak up when in doubt. Especially when there is more than one interpretation of insurance provisions. If these things are not addressed promptly the difficulty of collecting money will increase as time passes. Consequently it also prevents your patients from receiving the care they need.  Make sure your team is using all available channels of feedback.  As a result you will notice improvement in your processes and team conformity.  Next Level Consultants helps implement solutions that improve these challenges in dental practices. 

Collecting at the Time of Services

Collecting at the time of services is a crucial habit for dental offices that want to stay ahead. Ultimately when you collect upfront it results in a more efficient accounts receivable process that prevents the following issues:

1. Lack of communication with patients regarding their obligation
2. Lack of documentation or updates on patients accounts
3. Delay or lack of account auditing
4. Identifying past-due balances
5. In some cases, regulatory requirements stipulate that payments must be collected at the time of service.

As a result patients appreciate clarity and transparency in your billing process. When you inform them about their payment obligation and insurance estimates, patients are more likely to have a positive experience.  Moreover, they will be less alarmed by unfamiliar balances on statements sent in the mail.

Training your staff to collect payments from your patients during service is essential. Clearly communicating payment expectations to your patients will ensure they will comply and pay in a more timely manner. 

Incorrect Payment Posting & Adjustments

Your front office admins play a critical role in making certain payments and/or adjustments are recorded accurately. Furthermore, errors in payment postings and adjustments create confusion and discrepancies in your patient’s accounts.  The following issues are common mistakes made in Account Receivables:  

1. False credits
2. Adjustments applied incorrectly
3. Payments not allocated correctly to the proper patient, within a family file
4. Some procedures or charges can potentially be subject to contractual write-offs or adjustments with insurance companies. 
   • Failure to apply these adjustments accurately result in overbilling patients.
5. If insurance claims are denied or partially paid. It is essential to document these denials correctly. 
   • Incorrect updating and documenting claims can lead to inaccurate accounts receivable.

By all means, make sure your front office administrators receive proper training for payment postings and adjustments. Particularly, understanding the different payment types (cash, checks, credit cards, insurance payments). It is necessary for front office admins to have a firm grasp on how to handle handle EOBs (Explanation of Benefits). and how enter data into your practice management software accurately. When you work with Next Level Consultants, we presents a holistic approach toward boosting your front office’s performance. Our coaching system develops your front office to handle these key factors, significantly improving your bottom line.

Lack of Insurance Verification Protocols

Without a solid insurance verification protocol, practices face major issues relating to insurance coverages.  These problems include:

• Relying on faxed information instead of a complete breakdown
• Lack of awareness of network participation 
• Using incorrect or out of date fee schedules

Next Level Coaches also helps with insurance verification:

• We develop a comprehensive protocol for verifying patient’s insurance coverage–before their next appointment
• We ensure that you have accurate information on network participation and fee schedules

An Inadequate Patient Billing System

Finally, your dental practice’s billing is a major factor in managing accounts receivables.  An inadequate billing system results in compacted difficulties collecting money that’s owed to you. How are you managing accounts 30, 60, or 90 days past due?  Next Level Consultants understand the importance of having a strong dental front office team. Naturally we want to partner with you and your team to resolve any accounts receivable clean up on your balance sheet.  

Our coaches will clean up your A&R and get you on an optimum track to an efficient system. Mainly we want to work one-on-one with your team when you sign up for our “Front Office Program”. Your front office is the backbone of your business. We take your business seriously, and treat your business like it is our own.  Next Level Consultants prides itself in moving dental practices to the next level.

We invite you to reach out to us for a consultation on how to improve your front office systems like we talked about in this article.  Reach out in order to review your current processes. You can’t do everything on your own and sometimes you just need that extra guide right there with you in order to “double” or “triple your profits on an ongoing basis.