Accounts Receivable and Collections
Managing what is owed
Accounts receivable (A/R) represents money owed to the organization by payers and patients. Candidates must understand A/R aging, days in A/R, clean claim rate, and the distinction between insurance A/R and patient A/R. Effective collections require timely follow-up, denial resolution, and patient outreach.
Concepts to master
- A/R aging buckets (0-30, 31-60, 61-90, 90+ days).
- Days in A/R and net collection rate.
- Follow-up workflows and tickler systems.
- Patient statements, payment plans, and financial assistance.
- Write-offs and bad debt versus charity care.
Traps in questions
A frequent trap is treating all old A/R as collectible; some is uncollectible and should be written off or classified as charity care. Another is confusing gross collection rate (payments divided by charges) with net collection rate (payments divided by allowed amounts). Questions may also test whether a patient balance should be pursued before insurance adjudication is complete; it should not.
Rule of thumb
Work the oldest dollar first, but never bill the patient before the payer has adjudicated.
Worked example
An account is 120 days old with no payer response. The correct action is to check claim status, not to send the balance to collections. If the payer never received the claim, resubmit; if it is pending, document follow-up.