Many dental practices find monitoring and tracking accounts receivables a challenge. If collections are not prioritized by the billing team, the outstanding dues keep increasing. Many a time, it is the collection process that needs to be blamed.
For any practice, collection is linked to cash flows, and this considerably impacts profitability. It is imperative to follow dental billing best practices that speed up payments and improve cash flows. Some tips to boost collections and cash flows are outlined below.
Once a patient has been diagnosed and the practice has recommended solutions or procedures, the dental team needs to make the patient aware of all possible costs.
Before commencing any treatment, the team needs to get the treatment plan signed by the patient. This plan must encompass all possible expense heads that include total fees, the estimated insurance coverage, and the estimated amount that the patient would have to pay before service commences. The patient amount would include any deductibles or co payments as per the policy terms.
Most patients have insurance coverage through their employer or at an individual level. The dental team can ask for the insurance policy number and other details. This will help to ascertain the amount covered by the insurance provider and the amount that needs to be paid by the patient.
The plan must incorporate the signature of the patient or legal guardian, payment options, and informed consent to the suggested treatment. The original needs to be given to the patient while the team can retain an acknowledged copy. This helps to prevent possible issues later and enables the patient to pay for the services rendered to them.
Many patients assume that their dental insurance policy covers the entire cost of treatment. Some patients might not have fully understood the coverage details including conditions such as copayments or deductibles.
Hence, the dental team needs to apprise the patients of their insurance benefits, deductibles, or out-of-pocket expenses that need to be borne by them. This ensures that patients will not be surprised when a bill is generated, and any payment needs to be made by them.
Based on the policy plan and annual coverage, a patient can reach the maximum limit for getting covered by the insurance company. The dental team can then consult with the patient and decide if any procedure can wait till the next year to avail of any benefits or coverage.
The dental team needs to seek avenues of lowering expenses across the board as a means of controlling the outflow of cash from the practice. All expenses incurred need to be frequently monitored and areas that offer an opportunity to curtail costs must be identified and action implemented. Some examples where pruning can be possible are phone plans, magazine subscriptions, and keeping a watch on the heating or air conditioning bills.
The dental team can also negotiate with suppliers for better rates of consumables and other core requirements for delivering quality care to patients. The team can use its long-term relationships with vendors or bulk requirements to lower rates or credit periods.
The dental team needs to create a cash flow forecast statement that can enable the practice to predict and plan for future cash flow requirements based on historical data or any qualitative insights.
Forecasting regularly can help the practice anticipate busier phases during the year or slower times. Accurate forecasting can help the practice understand positive or negative cash flow situations throughout the year and prepare for the same accordingly. Such data can help the practice to scale down operations temporarily or postpone costly purchases to periods where the cash flow is adequate.
While cash flow forecasting may not be completely foolproof, the team can compare it with actual data and the same be adjusted accordingly. Over time, the forecasting will get more accurate and the practice can manage operations more effectively.
The cash flow of a dental practice gets affected when payments from the insurance company or patients are delayed. The team needs to frequently reach out to both these parties to recover delayed payments at the earliest. Follow-up calls and automated payment reminder emails need to be sent at defined intervals.
Staying on top of all delayed payments will help improve cash flows and increase working capital on hand that can be used for running the daily needs of the practice.
Cash payment, checks, and cards have always been an accepted mode of payment. Today, however, there are multiple modes of payment available that appeal to varying demographic profiles. It would benefit the practice to even offer these new modes of payment that are generally used by younger audiences.
Today, one can use contactless payment modes such as Google Pay or Apple Wallet in addition to net banking. A customer might avoid selecting a practice that does not offer a preferred choice of payment. Introducing more payment options can help a practice generate a more consistent cash flow.
The dental regulatory landscape is constantly evolving. As these guidelines especially for billing keep evolving, the practice needs to invest in periodic training for the billing team. The training could be through online courses or attending lectures or workshops.
Such sessions will keep the team updated on the latest CDT coding changes and general best billing practices. The practice can also consider deploying automated solutions that can simplify the billing process. This can offer additional time for the staff to take up different challenges.
As a general understanding, insurance companies determine a time limit for making claim payments. From the perspective of the dental practice, this translates into timely filing of the claim. Hence, the team needs to submit the oldest claims first as the expiration date for filing these claims will come first.
This makes it imperative for the team to carefully review and control the insurance aging report as missing the filing date can cause a permanent loss for the practice.
The team needs to know how the insurance aging report works. If a claim submitted by the team is not paid after having submitted it, these claims then get added to the list of unpaid insurance claims. Such claims can be categorized as claims not received by the insurance company or claims that have not been posted by the insurance company for payment.
This insurance aging report captures all outstanding claims arranged according to which insurance company the claims were presented.
The dental team might ignore the insurance aging report. This task can be laborious but needs attention as the financial health of the dental practice can be affected if the volume of unpaid claims starts rising.
A weekly review of the insurance aging report can keep the team alert, and each claim can be analyzed to determine the cause for denial or non-payment. Follow-ups can then be to the insurance organization for payment or the reasons for resubmission.
Dental billing best practices and a smooth collection process drive cash flows that improve operations. The team needs to outline all elements that can help to speed up payments including verifying insurance policy details, reviewing insurance aging reports, and keeping tabs on late payments.
