Importance of projecting monthly cash flow

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• Importance of projecting monthly cash flow

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Importance of projecting monthly cash flow
A glazed over blank stare or a stammering of
excuses is what we get from physicians when asked
about their projections for this months cash
flow. Imagine how an employee would feel if they
did not know how their next paycheck was going to
be for. How would they be able to plan their
budget for expenses? They wouldnt know if they
were going to be able to provide for their
family, or if their mortgage was going to be
paid. Then why is that so many physicians and
practice owners fail to estimate how much inflow
they are expecting in coming month. It has sort
of become standard practice within industry that
the people in charge of tracking money coming
simply just roll the dice and leave it to their
luck to get paid from insurance companies. They
feel that there is nothing that they can do and
give up. They become complacent and trust that
they will be paid. There is another way that is
much better way that will help practice
owners. Inflow projection is quite simple. The
number of working days in the month and your
current daily inflow is the basis for the
projection. Below are some areas that need to
address on priority to make sure that you get
your money at the earliest. Make sure bill
claims out every day. It feels like a hassle but
its really only minutes of work per day. It will
be easier for you to stay on-point with your
budget when you have constant flow of income in
your bank account. You should not only try to
send claims out on a daily basis but also go
ahead the extra mile and bill claims out the same
day the patient was soon. Its definitely
lucrative.
Medical Billing Services in Oregon
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Importance of projecting monthly cash flow
If your staff has the habit of completing their
notes over the weekend instead of the day the
patient visited then this needs to be changed
immediately. Similar to DSO it is critical that
staff complete all of their notes that will be
charged out the same day the patient was seen. It
will make it much more accurate to predict your
monthly inflow and will decrease the number of
days out that you will be paid. Keep your A/R in
check by posting monies coming in the same day
they are received. This will also enable you to
understand better the paying habits of your
payers. This is important because Medicare has 14
days from the time they receive the claim to pay
it. If you have any Medicare A/R over thirty
days, thats a problem for you, look into why
thats happening. Blue Cross, Aetna, and
sometimes Blue Shield pay within a week.
Healthnet and Cigna will pay within about ten
days. All of this is important so that you can
customise your follow-up process based upon payer
and know if they are paying on time. You will
need to compute your average inflow per day and
multiple that by the number of working days in
the month. Based upon how much money is posted on
a daily basis, this number will change and this
is why its so vital to send out claims every day
and post on a daily basis. But once you have a
better idea of what youll be bringing in for the
month, youll be able to better plan your
expenses.
Medical Billing Services in Oregon