Establishing a regular billing cadence is a vital contributing factor to your practice's cash flow. Here, we explore 5 strategies to help you implement a consistent billing cycle for your practice.
A healthy cash flow is one of the top pillars of a successful practice. Yet, over 60% of practices need help to maintain cash flow. A regular billing cadence can help mitigate this risk and improve your practice management.
Billing your patients regularly means receiving prompt payments, averting late fees and collection challenges. You should track your revenues and expenses too, which will help you understand your practice's financial health. It also improves patient satisfaction when they know when you'll bill them and how much they owe.
Understanding the Basics of Billing Cadence
Billing cadence is the weekly, bi-weekly, or monthly frequency you bill your patients within your practice to promote accurate and timely payments.
It encompasses invoicing, insurance claims submission, payment processing, and account reconciliation.
Steps to Establish a Consistent Billing Cadence
Billing isn't always a walk in the park. But when done right, it will grant you control over your practice's finances.
Here are 5 tips for establishing a regular billing cadence to enhance your billing experience:
Monitor Key Metrics
There are a few key metrics you can track to gauge your billing cadence's effectiveness, including:
- Days in Accounts Receivable (DAR) – measures the average days to collect payment from a patient after you provide a service. A lower DAR reflects a healthier cash flow and effective billing.
- Billing Cycle Time – measures the total time it takes to complete the billing cycle, from invoicing to payment collection. A longer billing cycle indicates there may be a few bottlenecks and areas for improvement.
Evaluate and Streamline Existing Processes
You don't necessarily have to start developing your billing cadence from scratch. Begin by assessing your current billing cycle to identify areas where delays and errors frequently occur.
Once you've identified bottlenecks and inefficiencies, implement billing software and electronic health records (EHR) systems to automate billing and coding tasks, capture patient information electronically, reduce manual errors, and improve efficiency.
Transferring this information to billing software that integrates with your existing EHR application minimizes manual data entry and reduces errors.
Define Roles and Responsibilities Within the Billing Team
Now you have a streamlined process in place. Define clear roles and responsibilities for patient invoicing, claims submission, payment processing, as well as follow-up communications within your billing team. Defined roles and responsibilities promote organization and efficiency. Assign each team member a role that aligns with their strengths and expertise or look to outside help from billing professionals to ensure a smooth process.
Remember, poor communication causes up to 70% of costly errors in the workplace. So, encourage regular communication and collaboration among the billing team members to promote a seamless flow of information and tasks.
Set Clear Billing Policies and Procedures
Clear billing procedures and policies prevent delays and misunderstandings by promoting consistency and transparency between your practice, stakeholders, patients, and staff.
Be clear on policies, such as payment expectations, late payments, and discounts.
Once you have these in place, communicate to your staff and patients:
- Patients – use written material, such as brochures, welcome packets, invoices, and appointment confirmation messages. Alternatively, prominently display them on your website and patient portals.
- Staff – use internal communication best practices; explain the policies during training and onboarding and provide regular updates whenever you change the policies.
Develop a Comprehensive Billing Schedule
A well-structured weekly, bi-weekly, or monthly billing schedule is the cornerstone for an effective regular billing cadence. So, create a comprehensive billing schedule covering every cycle stage, promoting consistency and timeliness.
With your schedule in hand, allocate specific days for each stage to establish a well-organized and effective billing cycle.
To ensure you get the schedule right:
- Balance the workload across the billing cycle
- Prioritize tasks that require the most immediate attention
- Use automated reminders and notifications
- Allow some flexibility to address unforeseen events
- Regularly review and adjust the schedule as needed
A billing schedule minimizes delays, enhances efficiency, and helps you become consistent.
Managing Your Billing Cadence Effectively
Once you’ve established a regular billing cadence, there are additional steps that should be taken to optimize the workflow and communicate billing policies to patients and staff:
Enhance Patient Communication
Effective patient communication is integral to any successful practice. It's essential you keep your patients in the loop, especially when you're about to make significant changes, such as introducing a regular billing cadence. This also helps avoid misunderstandings and can contribute to a positive patient experience.
- Educate patients about the billing process – what is their responsibility, when is payment due, and how can they pay their bill?
- Provide transparent cost estimates – ensure they know the cost of services before receiving them to avoid surprises when they receive their bill. Provide cost estimates on your website or during the consultation process.
- Explain insurance coverage and patient responsibilities – they should understand their coverage and any out-of-pocket amounts. You can provide this information in your patient handbook, website, patient portal, or during checkout.
- Offer multiple payment options – make the payment process easy for them by providing multiple payment options, such as online payments, mailed checks, or credit cards.
- Create a user-friendly patient billing statement – your patient billing statement should be easy to understand. It should outline charges, insurance adjustments, patient payments, and contact information for billing inquiries.
Ensure Compliance and Accuracy
Healthcare is among the most highly regulated industries in the country. It's particularly vital you adopt legal and regulatory-compliant billing and coding practices by:
- Staying updated on current billing and coding regulations. Research relevant industry regulatory bodies and leaders, such as the Centers for Medicare & Medicaid Services (CMS). Subscribe to industry publications and newsletters, attend healthcare workshops and webinars, or work with a billing consultant.
- Regularly training your billing staff on the current applicable billing and coding regulations.
- Conducting regular audits, reconciliations, and reporting to identify and correct any errors, overdue accounts, non-compliance issues, and fraud.
Manage Unpaid Invoices and Delinquent Accounts
Maintaining a healthy cashflow largely includes effectively managing unpaid invoices and delinquent accounts through:
- Implementing a systematic follow-up process for timely reminders to patients with outstanding balances. Escalate communication where necessary, such as through phone calls or collection letters.
- Negotiation options, such as discounts, payment plans, deferred payments, charity care programs, and sliding fee scales, for patients facing financial difficulties. You can also help them access prescription assistance programs (PAP).
- Knowing when to pursue collections if a patient fails or delays responding to your payment collection attempts. Enlisting the help of recovery specialists who specialize in medical debt collection can help ensure the financial viability of your practice while maintaining the relationship with your patient.
Your Path to Efficient, Patient-Friendly Billing
Running a successful healthcare practice involves adopting modern technology to promote efficiency, financial health, as well as a positive patient experience. Understanding the basics of establishing an effective billing cadence will give you peace of mind and fewer cash flow problems.
And that's what BillFlash RCM can help you achieve; a streamlined billing and coding solution for enhanced patient care, reputation, and financial performance. Schedule a demo and lay the foundation for a thriving, financially resilient practice.