Three things every physician office manager/administrator should know about

Healthcare billing is riddled with complexity. Complexity inherently means tons of details that may be difficult to prioritize and a staff that is buried in those details. Knowing how to raise your head above the details and make sure overall goals are being met is the real job of a billing manager.

Yes, yes….managers have daily personnel issues, unhappy doctors, a new set of denials and patients that don’t understand their bills taking up daily time. For most managers, a line in front of the office is just a daily reality.

But what are the core values of a healthcare billing office? What are the three metrics every billing manager must daily know and know the reasons behind those numbers? What are the three things that every billing office effort revolves around? What three things drives all forward motion in a business office and tells you what your progress is?

Take a moment and write them down…….yes, do it right now. (so wish I could see what you have written)

1. AR days – every billing employee should know what the AR days mean and what they are for the practices for which they bill….every employee? Yes, every employee……..I’d even go so far as to say yearly evaluations should include how well the employee contributed to lowering AR days…..but that’s just me. AR days simply means how fast do you turn around the money? Getting the dollars in the door is a given…..getting them in faster is the goal. Break that down by financial class or payer category………analyze the results……fix the problems that are holding up payments……..(charges into the system, denials, not leveraging electronic capabilities) whatever it is, lowering AR days will always be a good priority upon which to build.
2. % of AR greater than 90 days – how much money is sitting uncollected in AR? What are you doing about it? It’s not rocket science…..it’s all about the money. What’s holding up collecting the dollars? A growing self pay population? Then look at your policies and put into place a way of collecting on the front end that your patients and live with and gets money in the door. Are there specific contract issues holding up dollars? Get that payer in the door…….resolve it. A growing backlog of unresolved AR will kill a practice revenue stream……don’t let it happen. By looking at it every day…….it will make you focus on cleaning it up and keeping it clean.
3. Daily charges and Collections – most people only look at charges and collections monthly, and in retrospect. By daily following what’s going into the system, you can make sure that charges are consistently going in. What’s the value of that? You can only get in this month in payments what you put in charges last month. Highs and lows in charge entry can happen, but in general, a consistent flow of daily charges into the system should characterize the practice. Daily collections should reflect the same……a consistent flow of revenue that becomes predictable and manageable. If you only look backwards once a month, you cannot catch those oh so costly “oops” that could have been resolved immediately instead of 30 days later while you are standing in front of the physicians telling them where there money is.

Sounds simple doesn’t it? Simply be on top of what is happening from a big picture perspective every day with these three facts. They will either say to you….everything is fine, or they will say….uh oh…….what happened? Your ability to react quickly to problems is the difference between good and great as a manager.