AAFP members can ask a question at the Practice Management Help Desk.
Asia Blunt, MBA, CPC
Practice Management Strategist
Plan to watch this first in a series of quick, easily digestible online education modules. In only a few minutes, you'll gain a better understanding of accounts receivable and how it impacts your bottom line.
After watching this presentation, you will:
Revenue cycle management includes tracking claims, making sure payment is received, and following up on denied claims to maximize revenue generation. Several metrics can help you determine whether your revenue management cycle processes are efficient and effective.
The first metric is Days in Accounts Receivable (A/R). Days in A/R refers to the average number of days it takes a practice to collect payments due. The lower the number, the faster the practice is obtaining payment, on average.
Best Practice Tip
Days in A/R should stay below 50 days at minimum; however, 30 to 40 days is preferable.
First, calculate the practice’s average daily charges:
Next, calculate the days in A/R by dividing the total receivables by the average daily charges.
Understanding your practice’s revenue cycle will help you anticipate income and address issues preventing timely payments. Keep the following in mind when evaluating your revenue cycle and A/R processes:
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Days in A/R