Effective revenue cycle management (dental RCM) is essential for maintaining financial health and maximizing collections while ensuring patient satisfaction. Key to this process is the regular generation and analysis of critical reports. Let's delve into the essential reports every dental office should run, their frequency, and why they are crucial for practice success.
1. Patient Accounts Receivable (A/R) Report:
The A/R report provides insights into outstanding balances owed by patients. It categorizes accounts by age, allowing dental offices to identify overdue balances and take proactive steps to collect payments. It's recommended to run this report weekly to ensure timely follow-up on overdue accounts and maintain healthy cash flow.
2. Insurance Aging Report:
Similar to the A/R report, the insurance aging report tracks outstanding claims submitted to insurance companies. Running this report weekly helps identify aging claims and facilitates timely follow-up to accelerate reimbursement timelines and minimize revenue leakage. If your software provides an “unbatched procedures” or “unattached procedures” report, or something similar, this should be run at the same time as your insurance aging report
3. Production Report:
The production report outlines the total value of dental services rendered within a specified period. It provides a snapshot of practice activity and revenue generation. Generating this report regularly, typically on a monthly basis, helps track practice performance and identify trends over time. This report should be generated in totality, as well as by provider.
4. Collections Report:
The collections report details payments received from patients and insurance companies. It compares actual collections to the total value of services rendered, providing insights into revenue realization. Running this report monthly enables practices to evaluate collection efficiency and identify opportunities for improvement. This report should be run in totality, as well as by provider, and payment type.
5. Adjustments Report:
The adjustments report documents any write-offs or adjustments made to patient accounts. It helps track adjustments made for contractual allowances, discounts, or bad debt. Generating this report monthly ensures accurate accounting and transparency in financial reporting.
6. Deposit Report:
The deposit report records all payments deposited into the practice's bank account, including cash, checks, credit card payments, and electronic transfers for both patients and insurance payments. Running this report daily ensures accurate reconciliation of daily deposits and financial records. This report should also be generated monthly to track your practices overall growth and financial health from a metrics standpoint.
Expert tip: Use your reporting to calculate your collection percentage after each month ends. Successful offices should be collecting 98% or more of what they produce.
Calculation of Collections Percentage: Take your last 12 months of collections, and divide that by your last 12 month’s net production. That is your collection percentage. This can be done for any aligned span of time you wish to track.
Effective revenue cycle management in dental practices hinges upon the regular generation and analysis of critical reports. By consistently running and scrutinizing reports such as the Patient Accounts Receivable, Insurance Aging, Production, Collections, Adjustments, and Deposit reports, dental offices can gain valuable insights into their financial health, maximize collections, and ensure patient satisfaction. These reports enable practices to identify overdue balances, aging claims, track practice performance, evaluate collection efficiency, and ensure accurate accounting. Moreover, utilizing these reports to calculate the collection percentage provides a clear metric for assessing financial success. By implementing a robust reporting system and leveraging insights gleaned from these reports, dental practices can streamline operations, optimize revenue streams, and ultimately thrive.
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