Reports in Hand = Cash in the Bank
Remember the good ol’ days? You know, the ones in which your schedule was booked for months, the patients were flowing like Champagne from a fountain, and you were rolling in the green - or at least you thought you were. Then came the recession; it put a cork in the bubbly, made Swiss cheese of the schedule, and as for cash flow, accounts receivables went from so-so to “uh-oh.”
The truth is, you probably have little or no idea what your receivables were before the economy hit the skids, because you were most likely racing through your days too quickly to give nary a glance at the figure. And, after all, enough patients were paying up front and in full. Ah yes, the good ol’ days.
By the time 2008 rolled around, practices had come a long way in educating patients about payment expectations. Gone were the days of patient dictated payment plans - “I would like to pay $50 a month on my $1,200 bill that way I’ll have it paid off in just two years. No problem, right?” Practices put their collective feet down and said goodbye to the banking biz. Policies were not only adopted, they were actually implemented. Business staff became more comfortable with confidently explaining financial policies to patients, and patients were more willing to accept them. Then economic circumstances changed, and dental teams panicked.
Two years later, it’s time to hit the pause button on practice panic and pay attention to what I’m about to tell you. We all know that the economy has undergone a series of changes and challenges over the last several months. That being said, the expectation remains: Practice collections should yield 98% for treatment currently being performed. Should you be sensitive to your local economy? Absolutely - but not at the expense of the practice’s financial solvency. It’s time to issue a collections correction and get your accounts receivables back on track. But before you dig out, you have to dig in - into key practice reports that is. These are your guide to cash in the bank.
The Accounts Receivable Aging Report
The Outstanding Insurance Claims Report
Now that you’ve carefully reviewed these key practice financial reports, you have a much better understanding of where your practice financials stand, and you are ready to take action.
Next week, six steps to solvency
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