“Age is a number…”
There’s some positive truth to that – especially related to birthdays.
Staying on the age-theme – your dental practice aging reports might not be so positive based on what they reveal about outstanding claims or payments.
“Older” isn’t better when a patient’s bill is past due. Collecting on it becomes more difficult as time elapses.
That makes your aging report data a core metric for monitoring and creating a system for timely collections.
Accounts aging…where to begin?
A dental dashboard is a good place to begin your A/R reality check. Don’t fear the data – it’s there to point the way to better days relative to your revenue cycle.
But only if you take action!
Standard analysis breaks-down overdue account aging as follows:
- 0 to 30 days
- 31 to 60 days
- 61 to 90 days
- Over 90 days
Your aging report is an effective fly-over of patient payment habits. Mining A/R data for more than what’s due can also give you an insight into future patient conversations around how they will pay for services and what financial solutions might be useful to them.
Back to the data…
What’s the deal with A/R in the first place?
Financial factors vary from patient to patient and practice to practice. There are common reasons for not being paid in full or on time.
- Patient insurance coverage isn’t accurately determined
- A patient departs their appointment with a balance and no payment agreement
- A patient fails to pay on their agreed upon financial arrangement
Dental industry consultants and financial advisors would agree somewhat that A/R should not be greater than the average amount of the month’s production. Thus, nothing in your aging report would show A/R older than 30 days.
That might seem unrealistic but again, it’s agreed that it’s a worthy benchmark to strive for. Even though you will likely miss the mark along the way – you have a well-defined and visible target.
How your aging report data helps keep your dental practice on-track (and profitable)
Dental practice financials require consistent attention. It’s not so much micro-management as it is knowing your numbers.
- Observe A/R timelines (e.g. your 30, 60, 90 past dues)
- Calculate the amounts owned by each overdue account
- Determine who owes it (e.g. insurance or patient)
Think of demographics in a different context here. Focus on the account’s aging status and the amount that’s owed.
Keep in mind that those with large balances will require some strategy (and additional time) to zero out. It’s good motivation knowing that once they pay your A/R will experience some breathing room.
- Confirm the source of large balances. Many could be outstanding insurance claims.
- Communicate consistently with the insurance company regarding payment.
- Communicate account status with your patients – especially those that are caused by insurance claim delays. This helps them know they remain in good standing with you.
- Construct a payment plan with patients who have large balances. Give them light-at-the-end-of-the-tunnel with helpful financial solutions.
A word or two about those aged accounts…
Again, those over 90 days could be an insurance delay. Diligent communication with the company is essential to secure payment.
Those that are patient sourced will require understanding and strategic action.
- Seek to understand why it’s overdue/unpaid. Personal circumstances, unreceived statements, invalid contact information, etc could be the culprit.
- Seek a solution that involves a mutual payment agreement, more aggressive action (e.g. collections), or write-it off.
Update your financial data (whatever your course of action) so the next report reflects the change.
Some treatments such as orthodontics or implants might have large balances exceeding 90 days. Could be an insurance payment issue as well.
Keep patients in the loop about what’s owed and what remains outstanding from the insurance provider. Make payment arrangements on the balance by offering third-party financing (e.g. CareCredit, etc).
A/R problems can be avoided or solved early on if you have good workflows in place.
- Empower key team members to run-point on A/R and related aging reports.
- Double-check insurance filing so payment estimates are accurate.
- Communicate insurance information to your patients. Confirm that insurance is estimated to pay but there are no guarantees and an amount could be owed post filing.
- Obtain a signed treatment plan that emphasizes the insurance estimate and what they will owe pending approval.
- Submit your insurance claims efficiently. Confirm that all claim data is correct.
- Train your team about financial conversations. Have a narrative in place for each scenario.
- Follow-up on all claims ahead of standard aging timelines (e.g. 30, 60, 90).
- Determine how you will work out payment arrangements or proceed with collecting overdue payments.
Dental practice aging reports rely on accurate and timely data analysis
The Jarvis Analytics platform helps assure that you’re tracking the important metrics and staying on-track in your daily workflows, financial systems, and overall practice or DSO goals.
Experience Jarvis in action. Request a demo today!
Contact us for more information about data tracking that leads to improved reporting.
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