Strategies for Prioritizing Patient A/R

This is an excerpt from our webinar “Prioritizing Patients Accounts Receivable”, part of Rivet’s Revenue Cycle Webinar Series. Watch the webinar on demand here.

Strategies for prioritizing patient accounts receivable

Every practice has open patient balances that need attention. We get it. The trouble is, you can’t expect to be efficient in collecting on those balances if you don’t have a prioritization method in place with your team, and making a plan isn’t always easy. In many practices, a rep sits down with a large number of accounts and works them without a plan, which can result in suboptimal collection rates. While, in an ideal practice, a rep would start the day with their accounts in a queue based on the highest priority as determined by their team. We want to help make the ideal a reality, so, to help you determine what plan might be best to apply to your practice, we’ve outlined the pros and cons for potential options. 

Sort by yield-opportunity

With this option, reps would work the highest dollar accounts and work their way down, which would mean collecting larger sums of money. The hang-up here is that highest dollar balances are some of the hardest to collect and remain unpaid for a reason. It’s also the case that the amount of touchpoints and discounts often go up for these patients. 

Sort by age of account/risk level

Working accounts by age helps practices get closer to the date of service, which is a great goal. You may find, however, that you still have low collection rates with this option. 

Propensity to pay

This option generally has the most effective collection rates because your system has defined them as the most likely to collect. However, putting this system in place requires more upfront investment and is one of the most difficult to develop (What balance thresholds are you going to use?, Are you going to do a soft credit check?) and is the most work to maintain (typically requires a vendor). 

Hybrid yield/risk 

(Hybrid of high dollar/age of account and developing a risk level) This system assigns a risk score to each account so there is a standard risk index and would require an internal discussion on balance threshold with your team (What do you want to optimize for? Dollar? Age?). Additionally, some accounts may not enter into a clear risk level that doesn’t hit the workflow frequently enough, which could result in older accounts. 

Making the Transition 

With these options in mind, the question becomes, how do you make the transition from the way you are working accounts today to your ideal patient-collections process? A good place to start would be to set reasonable expectations. These will not be overnight changes, and can be painful to apply at times, so, setting clear, reasonable expectations can help eliminate some of the stress that comes with this type of transition. From there, ensure that all stakeholders involved align on the problem to be solved (i.e. We want to be better at patient collections, We want to be better at open patient A/R, etc.). Then, set a collection rate target. Where do you want to be? (i.e. Improve collection rate %, Reduce cost to collect, etc.) Set goals to achieve this target. 

Once goals have been set, get your team onboard. Communicate the goals with them, ensure that they align with your goals, and then, start small. Lay the foundation of achieving your targets brick by brick, keeping in mind what you want to achieve eventually while considering what you need to do to get there. Test different strategies, and then standardize the most effective processes across the entire team, making sure you are consistent. 

Quick Wins for A/R Hygiene

When prepping to make a transition into a new workflow model, you’ll want to do some “spring cleaning” first. We recommend employing a few tactics to help you quickly clean up A/R components, and to avoid bringing dormant, non-collectable accounts into the new work flow model.

Some ideas for A/R hygiene include: 

  1. Applying credit to a debit. This task requires some review, but can help to clean up credit and debit balances in the patient space. This is achieved by moving balances around to cover each other, where applicable. 
  2. Removing balances below a low dollar threshold. As part of your collection policy, determine a number that is too low to collect on. This would be a number low enough that it would not make sense to invest the time to collect. Once this number is determined, write off the balance on any applicable accounts to clear them. 
  3. Guarantor payment for dependent accounts. Spend time looking through guarantor payments and ensure that none are misapplied that should be applied to a dependent balance. Reconcile where needed. 
  4. Grouped balance settlement. Help patients settle multiple balances at once by providing a discount. 
  5. Create blended “Risk Level I” worklist. Create a record to show the top accounts. Define the highest level priority of accounts and make sure reps know those are the ones that they should be working. 

We understand that making systematic changes can be challenging, even daunting to consider. However, by setting reasonable expectations and goals, communicating those goals with your team, and making smart, thoughtful changes, the ideal can become a reality for your practice. 

For more tips and resources during this transition: 

Watch the full webinar here.

When did it become so difficult to collect patient A/R?

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