“I’ve seen a lot of practices look at the reports but not have any clear expectations or goals in mind. They just look at it and say, ‘This doesn’t look good’ or ‘This looks fine’ or ‘I don’t even know,’” says Hertz.

Instead, compare your data to historical measurements from your own practice. Or purchase benchmark data available by specialty in the Medical Group Management Association’s annual Cost Survey.

Look at old accounts

Next, move in for a closer analysis of the accounts that are more than 120 days old. What percentage are more than 140 days old? Older than 160?

“If 60 is good, 90 is good, but days-over-120 is huge, the reason for that is that there are accounts in there that are over a year and a half old,” says Karen Zupko, founder of Zupko & Associates.

That’s bad news:

Medicare won’t pay on any claims after a year from the date of service. Most commercial payers are much stricter. If you have lots of claims sitting out there that have passed timely filing deadlines, your only option may be to take a deep breath and write them off — and resolve to never let it happen again.

You sure can try to get commercial payers to cut you some slack before you write off ancient accounts. Zupko recently worked with a practice in North Carolina whose staff called a payer, explained that it had been victimized by a very bad employee, and got permission to get some eight-month-old claims processed. But don’t expect this sort of leniency.

If some large claims are near the deadline, make it a priority for staff to hustle those claims or appeals out the door. When working down accounts more than120 days old, “typically, we look at starting with plans that have the tightest filing and appeals deadlines. Those with tighter deadlines get priority, as do accounts with higher balances,” says Beaver.

“The intent is to make sure that accounts that are high-balance or at risk of being lost due to timely filing reasons are being addressed ahead of accounts that are not as time-sensitive or have less of an impact on the cash flow,” agrees Masoud Khorsand, MD, president of Southeastern New Mexico Internal Medicine and cofounder of Catalisse, a company offering outsourced medical billing services.

While you are in write-off mode, clear your books of accounts worth less than $25 and more than 130 days old. That doesn’t mean you have to give up on them completely. Beaver had a client who made a small balance adjustment to clean up the accounts but put an alert on all the related patient accounts. When those patients called in, the scheduler could see what they owed and told patients they couldn’t schedule another appointment until they paid. “If you are in orthopedics, that patient might never call again,” says Zupko of this strategy, “but if you are in OB/GYN, pediatrics, or internal medicine, chances are that person is going to darken your door once again.”

All this is not to say that you should blithely write off accounts as a way to feel more orderly. Hertz worked with one group whose “A/R over 120 days was awful. I told the docs they had a real problem.” An outside physician who worked as this practice’s management adviser met with Hertz and said, “I don’t see what the problem is; you just write it off at 120 days.” He wanted order. But the point, of course, is to collect that money while you can. Any write-offs should be done with much hand- wringing and a plan to make sure it doesn’t happen again.

“A/R problems point to systemic issues,” says Khorsand. “Once you have had a chance to take care of your immediate A/R needs, devote some time to analyzing why the A/R buildup happened in the first place. Maybe you had an experienced biller leave, and to fill the gap quickly you hired someone less experienced. Maybe the front desk person was inexperienced with your practice management software and entered incorrect billing information. With a process-oriented approach, you identify the problem areas and make modifications to your practice work flow to address them. It is quite common for practices to take an episodic approach to fixing their A/R problems. You can be certain that if you have not rectified your work flow, the A/R problem will rear its ugly head sooner rather than later.”

Make sure that not all the attention goes to accounts over 120 days. “I think you are far better off looking at over 90 days and lumping that all together [with accounts over 120 days],” says Hertz. “Over 90 days, you’ve got a problem. By 120 days, it’s too late — or at least close to it.”

Study by payer