10 Things Your Boss Wishes You Knew About Receivables Management

Account Receivables (AR) are amounts yet to be received for goods or services ordered. AR is legally enforceable claims for payments generally in the form of invoices raised by a business for the goods or services rendered to the customer. 

 

In a hospital setting, AR could be in the form of Government Schemes and Insurance Claims owed to the hospital by the administering authority, generally the claims processing department of the Government scheme or the Health insurance company. 

 

Here is where things get a little complex. If you are working in the hospital insurance claims department here are some important things you need to know.

 

  1. Each policy or agency has its cycle of payments against the claim raised. For example Insurance Company A may have a processing cycle of 15 days while Insurance Company B may have a cycle of 45 days 
  2. Accounts Receivables management is critical for a hospital to ensure proper reconciliation. Lack of an AR tracking system could lead to bad debts and bad patient experience. 
  3. Limited mode of payments. If your hospital has a limited mechanism of payment receipts, for example, if the hospital accepts only CASH payments, it somewhere reflects on the profit. The solution is to have multiple payment processing options like Credit/Debit Card, Online direct bank deposits, Digital Payments, among others. This gives more flexibility to patients to pay for services. 
  4. Interdepartmental coordination. How often do we experience that the attending doctor has given a discharge note but the Nursing Station, Pharmacy, Diagnostics, Billing Department and Claims department are running from door to door to get the right discharge summary and supporting documents? The solution is to integrate Medical Records, Pharmacy, and Billing systems that streamline the discharge process. 
  5. Hospital Staff training. Many of the medical staff and nursing staff have limited knowledge of the insurance claims process. Regular internal training could help better communication between departments and better coordination 
  6. Using multiple software systems or paper-based systems could increase the time required to gather all necessary documentation. Having one robust system across the organization could ease-out bottlenecks. 
  7. Requests for more information by the claims department of the agency or the insurance company are very common. This simply means not enough documentation was submitted during the initial claim process to justify the claim. Having a centralized information system could reduce the errors and the claims department could have access to all reports, bills, and treatment data before the claim is submitted therefore reducing the overall AR cycle. 
  8. Patients and Their Attending family members the majority of the time are not aware of the insurance coverage. It would be helpful if one dedicated insurance processing expert reviews the policy at the hospital and educates the coverage and limitations of the policy to help the patient understand the policy better and take better decisions. 
  9. Timely and Accurate information when provided to the insurance claims department reduces the overall lifecycle of the AR in question. 
  10. Develop a Plan, SOP, and KPI for your Hospital Claims department, Define roles and responsibilities. It is essential to have a plan in place. High staff attrition is a problem many hospitals face. The Claims Process plan and Process map will assist in hiring the right resource and providing training. KPI measures the performance of the department. 

 

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