For clinics and doctor’s offices, having trouble with maintaining a ready cash reserve is often a problem. That’s because many clinics don’t build up cash reserves to deal with cash flow problems. One of the reasons for cash flow problems is that clinics very rarely get paid in cash. They deal with insurance companies for the most part and those institutions are generally the main reason for the medical accounts receivable long overdue, since they often set up overly tedious and complicated procedures before they pay you. These insurance companies can also reject claims, which further delay payments.
For medical accounts receivables long overdue, the best way to handle the situation is to set up an efficient revenue cycle management:
1. Medical accounts receivables should be filed and grouped in an effective manner, so that the clinic can track them better. The accounts receivables should be sorted into groups defined by their due date. For example they can be grouped into overdue, current, 30, 60, and 90 days categories. This makes tracking accounts receivable more organized, and more attention can be focused on the current and overdue accounts.
2. Someone has to take the responsibility to follow up on these accounts on a regular basis. These employees should make regular calls to Medicaid and Medicare, along with the commercial insurance companies. These follow-up calls should be done regularly so that the current status of the claim can be determined.
3. If there are any delays, the cause must be ascertained and if possible, rectified. The proper documentation must be ascertained, done, and sent to the appropriate insurance companies so that the process can go much more smoothly. In case of rejection and denial, information and documentation must also be collected.
4. Problems and trends can then be projected using the information gathered from the collection process. For example, the insurance carriers which regularly make slow payments can be identified, and so can the insurance companies which make an inordinate number of rejections and denials. By identifying them, future problems may be avoided.
While all these can be done by the clinic themselves, it will also take a lot of time, effort, and money. Perhaps the most efficient way to alleviate the situation is to work with factoring companies that specialize in medical factoring so that their knowledge and experience can be utilized for the benefit of the clinic.
The main advantage of using experienced medical factoring companies is that they are very familiar with the processes of various insurance carriers. Factors know what kind of paperwork to submit. With that kind of knowledge, the problem of long overdue medical accounts receivables may be minimized or avoided altogether.