Does your dental practice double as a bank? Your accounts receivable (A/R) holds the answer to this question. While your dental practice was created as a place to help people in your community and improve the oral health of your patients, it was also created as a business. Unfortunately, many dental practices end up unwittingly entering the financing business and find themselves dealing with a long list of aging balances waiting to be paid. Reducing accounts receivable is critical to the sustainability of your practice.
How Do You Stack Up?
In 2016, based on data from Sikka Software acquired at over 12,500 dental practices, the average A/R greater than 90 days for a dental practice was $47,736.21. While your practice would ideally have a number lower than that, let it serve as a benchmark for how you rank compared to others.
For your specific practice, you should never have insurance claims that are 90 days or older. The total of your accounts receivable should not be higher than 50% of a month’s average production. You should also compare your A/R to what it was in past years and months to identify any trends that could be potentially hampering your ability to collect.
How Can You Improve Your Accounts Receivable?
- Pre-Estimate Insurance Coverage: Collect insurance information from patients when they make an appointment and follow up by confirming coverage with the insurance company. Always overestimate how much the patient will owe your practice instead of the other way around. It’s better to send a patient a check for $100 overpayment instead of trying to chase down $100.
- Give a Discount: If patients pay when scheduling their appointment, offer a discount for prepayment. Or, consider offering a discount for patients who pay by cash or check instead of a credit card.
- Ask for Payment in Full: Do you make a habit of asking each patient for payment in full during the check out process? Regardless of whether or not you think the patient has the money to pay at the appointment, set the clear expectation that payment is due in full. Many practices are surprised to find how many patients will pay at the first request, and how quickly it sets the tone for when payment is due.
Improve Your Practice with APEX Reimbursement Specialists
APEX Reimbursement Specialists can help guide you through an audit to review how your practice is doing with accounts receivable and more. Contact our team today by calling (410) 710-6005. We look forward to working with you to make your practice a more profitable place.