In the healthcare industry, A/R days refer to the number of days that it takes to receive payment after a service is provided and a claim is processed. This critical metric helps healthcare facilities measure which accounts are paid on time and which ones aren’t, providing insight into the entire accounts receivable process —a crucial part of claims management and overall revenue cycle management.
Advancements in technology, including automation and AI, have revolutionized accounts receivable (A/R) processes, such as claims management, to help healthcare facilities reduce A/R days and get paid faster. Aging accounts receivable (A/R) systems can delay processing, creating an environment where bills can be missed, and revenue is lost, making technology-enabled claims management a must-have in today’s healthcare facilities.
Understanding A/R Days and Their Challenges
A/R days will tell a facility how long it takes to get paid, but it also acts as a microcosm of the efficiency of the entire revenue cycle management process. If A/R days are high, there is a high probability that other issues or inefficiencies exist within the organization’s revenue cycle.
Increased A/R days could indicate problems at intake, such as not receiving accurate information, improper coding, manual errors, or issues with timely billing. A/R days are a crucial metric for healthcare institutions to track.
When A/R days are elevated, it means that the provider is not getting paid on time. This can impact not only total revenue but it can also impact cash flow, limiting resources. Providers may have to write off claims and deal with costly backlogs, which create a range of problems for the organization’s overall financial health. If the problem is severe enough, it can even impact the total financial stability of the organization.
The Role of Claims Management in the Revenue Cycle
The revenue cycle encompasses the financial aspects of patient care, including initial intake, insurance claims management, and ultimately, billing and payment collection. Because healthcare isn’t typically a point-of-sale payment, healthcare providers and organizations engage in a revenue cycle that is inherently complicated due to the processes involved in medical billing and coding, insurance claims processing, reimbursements, and patient payment collection. End-to-end revenue cycle management will take an even more comprehensive approach to this cycle.
Inefficiencies and errors can occur nearly anywhere in the revenue cycle, particularly when a provider or organization relies on manual data entry and claims management. Manual claims management requires an individual to take the patient’s information, properly code procedures or services rendered, submit the claims, follow up on the claims, handle denials or delays, and do whatever needs to be done to secure payment, whether that is appealing a denial, resubmitting, or billing the patient for the remaining balance.
How Technology Streamlines Claims Management
Technology has completely revolutionized claims management, eliminating the element of human error that can commonly occur with the tedious and complex processes of claims management. Automation has made claim submission and tracking a breeze, providing providers with a snapshot of their current status in the claims process, the duration they’ve been there, and the current status of a claim.
Additionally, the advent of AI has completely changed how providers submit claims. Predictive analysis of claims can alert providers to errors or inconsistencies before claims are submitted to the insurance provider, and the data it provides can offer insight into what claims are denied, preventing improper coding or the continued submission of a code that won’t pay out.
In the current technology climate, providers are seeing streamlined claims management that makes everyone’s jobs easier, especially when there is complete and seamless integration with electronic health records or patient management systems. A/R days can be reduced by days, experience first-pass approval, and pave the way for significant efficiencies for the organization, improving cash flow and the overall health of the organization.
Key Features to Look for in a Technology Solution
If you’re considering a tech solution for claims management, providers should look for features that help solve their problems, give them the tools for success, and position them for growth and excellent financial health. A technology-enabled claims management system that has the following key features is a great indicator of an excellent product.
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Reporting and Analytics
Obtaining real-time data on A/R days and the claim lifecycle, including denials, can help providers identify and address issues. With denials on the rise, this information is crucial for providers.
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Claims Scrubbing and Validation
An ounce of prevention is worth a pound of cure, and the claims process is no different. Having the automated capability to review claims for errors and fix them before submission will lead to speedier payments, fewer duplicated efforts, and shorter A/R days.
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Benefit Eligibility Verification
Find out what’s covered and what isn’t before providing services to a patient, eliminating frustrating and costly surprises by confirming what is and isn’t covered.
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Claims Tracking
Having the ability to view the status of a claim will enable better follow-up. Automated follow-up can also help expedite the process and reduce A/R days.
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Work With Your System
Another key feature to consider is whether the tech-enabled claims management system is compatible with your electronic health records and patient management system. Newer technology isn’t always guaranteed to work with older, legacy systems, so it’s crucial to determine whether the systems are compatible.
Start Reducing Your A/R Days Today
When you work with a company that has the technology to propel your organization forward with technology-enabled claims management, you’re setting yourself up for financial stability and long-term success. Credence Global Solutions has the experience, technology, and communication to keep your healthcare organization running at its best.
Consider your current system and how well it’s working for you — are there areas that are causing delays? Are you able to access meaningful data about your current operations performance? If it’s not working or you’re not sure how you’re performing, contact Credence Global Solutions today for expert help and a free quote that can help you reduce A/R days and get paid faster.
