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The financial health of medical billing companies does not depend on a single entity instead, a number of steps are included like dealing with insurance companies, fulfilling coding requirements, accurate claims submission, and then receiving patient payments. A lot of things are included in this process but the major component of a practice’s cash flow is Accounts receivable (AR). If AR isn’t managed well then it can impact the overall financial health of practices. It’s very frustrating for healthcare providers if they are doing the work and providing care but the money isn’t coming in when it should. But the good thing here is that you can streamline this AR process with some smart strategies, consistency, and the right tools. So let’s discuss how you can streamline accounts receivable for efficient billing processes.

What Is Accounts Receivable in Medical Billing?

In the simplest terms, accounts receivable refers to the money owed to your practice for services you’ve already provided. It's what insurance companies and patients still need to pay you. The longer that money sits in AR, the more it costs you in time, resources, and stress.

The process of accounts receivable is simple. When patients get treated, the practices generate a bill or submit a claim to insurance companies. This bill remains in the A/R category until the payment is received. The A/R gets closed when the insurance companies process the reimbursement and accept the claim.

Ideally, each healthcare provider wants that money collected quickly and accurately. But when claims get denied, patient balances are missed, or follow-ups fall then AR days get longer which increases the chances of bad debts (the amount that most probably never recovers). The preferable AR days are 30-40 days so try to keep them below 50 at minimum.

Understanding the Numbers Behind AR

Accounts Receivable Turnover & Turnover Ratio

The accounts receivable turnover is an important metric that tells you how efficiently your practice is collecting payments. It shows how many times on average your accounts receivable are collected during a specific period, like usually a year. You can calculate it using the following formula:

Accounts Payable vs Accounts Receivable: What's the Difference?

These two terms often get mixed up, so let’s clear them up.

Accounts Receivable (AR) is the money owed to you by patients or insurers for services you’ve already provided.

Accounts Payable (AP) is the money you owe to vendors or suppliers for services, equipment, or other expenses.

In short:

Why Streamlining AR Is Important

If you do not monitor AR it means that you are leaving your money on the table. It means that you lose thousands or maybe tens of thousands every month.

When you do not streamline AR, your practice faces:

The Common Causes Behind Slowed AR

Here are some of the biggest AR causes in medical billing services behind slowed AR:

Slow Claim Submission

If you do not submit the claim properly or completely then there are more chances of payment delays as denied claims take to recover. Late claim submission can also cause AR to be delayed.

High Denial Rates

Errors in coding, missing documentation, or eligibility issues can lead to denied claims. When you have a higher denial rate, your AR days also get longer.

Poor Follow-Up

Not following up on unpaid claims or patient balances is like forgetting to collect your paycheck.

Lack of Patient Communication

If patients don’t understand what they owe or why, they’re less likely to pay and there are more chances to ignore bills.

Outdated Technology

Technology plays an important role. Are you still using spreadsheets or clunky systems? You’re working harder than you need to and it’s probably costing you.

How Do You Streamline AR?

Without streamlining your AR processes, your practice cannot earn money on time. AR management is especially important for small practices that have limited resources and need money on time to manage their expenses. Streamlining AR processes means improving your AR recovery processes and increasing your cash flow and profitability. Let’s see some of the best ways to streamline your AR processes.

Start With Clean Claims

Accurate coding affects the quality of your data. And healthcare is becoming more data-driven than ever. From population health to outcomes-based reimbursement models, your coding tells a story. If that story’s full of errors, your reporting gets skewed and your practice can not qualify for certain incentives or programs.

It Impacts Patient Care

You’ve probably heard a hundred times that clean claims are key. Submitting accurate and complete claims the first time saves you from the headache of denials and rework. Here’s how to make it happen:

Double-check patient demographics and insurance info. It sounds basic but it’s a common reason for rejections.

Invest in a solid coding team. Or use software that catches coding errors before submission.

Run pre-submission claim scrubs. Consider it your final step before claims hit the payer.

The more you can get paid on the first try, the less time and money you’ll spend chasing payments later.

Tighten Up Eligibility and Benefits Checks

Suppose providing a full workup for a patient, only to find out later that their insurance doesn’t cover it. Now you’re stuck with the bill or trying to collect from a patient who had no clue. You can avoid these situations by:

Verifying eligibility before every visit even for returning patients. Coverage changes all the time.

Confirming benefit details upfront. Know what’s covered, what’s not, and what the patient’s responsibility is.

Many billing systems now provide real-time eligibility checks so try to use them. When you have completed your homework before the appointment, then you receive fewer surprises afterward.

Have a Solid Denial Management Process

Denials happen. Even with clean claims, some payers deny the claim. After facing denial, don’t sit and wait. You need to do the following:

Track denial reasons. Look for patterns and fix root causes.

Appeal quickly. Don’t wait weeks to appeal a denial as most have strict timelines.

Automate what you can. Some denial codes can trigger predefined workflows that help your team act fast.

And remember, every denial is a chance to learn and improve your process.

Follow Up Regularly

Following up on unpaid claims and balances is always frustrating but it’s one of the most important tasks. Build a follow-up system that includes:

Automated reminders for outstanding balances.

Regular AR aging reports so you know what’s past due and how long.

Dedicated team members who focus only on AR collections.

The most important thing here is consistency. Don’t let unpaid claims linger until they’re uncollectible. You need to stay on top of them weekly if you cannot manage them daily.

Make It Easy for Patients to Pay

Patients always prefer ease. If paying a medical bill is a hassle then many patients just won’t do it. That’s not necessarily because they don’t want to but it’s because the process is confusing or inconvenient. Here’s how to fix that:

Provide multiple payment options. Online, mobile, credit card, payment plans—give them choices.

Send clear, itemized statements. No one wants to decode a cryptic bill.

Use text and email reminders. People are more likely to respond to a quick text than a paper bill buried under a pile of junk mail.

Try to be upfront about costs. When you take transparency in your operations then it goes a long way in building trust and boosting collections.

Use Technology to Your Advantage

If you’re still relying on manual processes then you are wasting a lot of your time and money. Today’s revenue cycle management (RCM) tools can do a lot of the heavy lifting. There are different accounts receivable software available.

Look for systems that:

Automate claim submission and tracking.

Scrub claims for errors before submission.

Flag denials and missed payments.

Generate real-time AR reports.

Many platforms can even integrate with your EHR and make data flow smoother and with lower chances of double entry. Try to prefer accounts receivable automation in your processes.

Train and Retrain Your Team

Even the best system won’t work if your team doesn’t know how to use it. And we all know how fast billing rules are getting changed that’s why ongoing training is necessary.

Make sure your staff

Understand billing workflows and payer requirements.

Know how to use your billing software effectively.

It can find errors before they become problems.

Monitor AR Metrics Regularly

When you dont track things, you can’t improve them. Keep a close eye on your AR metrics so you know what’s working and what’s not. You can do this by considering the following:

Days in AR: How long it takes on average to get paid.

AR aging buckets: How much money are 0–30 days, 31–60, 61–90, and over 90?

Denial rate: What percentage of claims are being rejected?

Collection rate: How much of your billed amount you're actually collecting.

Use these numbers and set goals, try to motivate your team, and pinpoint problem areas before they get out of hand.

Outsource Your Billing Operations:

If you want a clean claim, then you can outsource your billing operations to a professional and experienced medical billing company. And here’s the best option is QuickPay Solution which is an experienced medical billing company in the US. Their experienced team knows how to submit the claim and pass it in the first turn. The clean claim means that you get your A/R payments more quickly.