Radiology Coding Alert

Use these tips to maximize positive cash flow into your practice.

Whether you’re more focused on the coding elements or the practice management components of your radiology practice, you should be acutely aware of all the relevant yearly cash flow trends impacting your physician’s revenue.

Specifically, this means having a grasp on the charting of your accounts receivable (A/R) data. In evaluating this information under the right lens, you can gain a much better understanding as to which factors are positively and negatively influencing your practice’s cash flow.

Have a look at five helpful recommendations to stay organized and on top of all the data that’s impacting your physician’s financials.

1. Chart four key billing variables monthly. Payments, charges, closing A/R, and adjustments. This won’t require advanced software skills — you can simply use your spreadsheet program (such as Microsoft^® Excel) and a simple line graph. You can obtain these four variables easily from your monthly reports, and they’re useful because they serve as basic cash flow indicators. You’ll want to chart the entire previous year using the numbers from monthly reports. Then, as you add to the chart each month, you’ll be able to spot changes in the basic patterns that can indicate problems or other influencing factors.

2. Analyze the peaks and dips in your chart. Some fluctuation is normal because of a physician on vacation, a particularly busy month, or stepped-up appeals efforts. On the other hand, excessive fluctuations in charges, payments, or A/R can indicate a problem.

Inconsistent charge entry can cause ups and downs in payments and closing A/R. This may not be a big deal as long as the cash flow is still there. But if cash flow slows down every time charge entry drops and your practice struggles to pay the bills, then this problem merits attention. Practices often pull billers away from their duties to fill in for an absent medical assistant or other staff member. What the practice doesn’t realize is how important a biller’s duties are to the regular office operation.

3. Remain vigilant. Check your chart every month to identify new problems. If your office has staff turnover or other interruptions, use the chart to make sure your billing office stays on top of charges, appeals, and collections. If you notice your A/R starting to climb, you’ll know quickly that you need to focus on the billing staff’s efficiency and your appeals process. Without a complete A/R chart, you have no way to tell quickly if your office is doing its work correctly.

4. Strive for your optimum A/R. Every practice is different, so your optimum A/R may be rightfully above or below the average. Chart out your A/R and analyze the factors affecting it, but don’t stop there or you might be leaving money on the table. Use the insight you gleaned from your chart to make appropriate billing changes, such as more frequent charge entry and appeals work, or sending accounts to collections sooner.

5. Predict next month’s cash flow. A clear understanding of your normal billing trends (demonstrated by your chart) will grant you the power of prediction. For example, if your chart indicates that money consistently decreases around the holidays or during the summer, your practice can plan accordingly. Cash flow does follow cyclical patterns based on various external factors. It’s beneficial to predict the unavoidable cash flow downturns so you don’t find yourself unprepared.