Payment tracking is an important part of running a successful medical practice. Here are five reasons why.
- So you know how much money you are owed - If you receive a single payment for multiple bills from an insurer and you don’t allocate it correctly, it soon becomes difficult to know which invoices have been paid. That makes it impossible to chase for the outstanding amounts and means you could be forced to write off debts unnecessarily.
- Bad debt soon hits your practice cash flow - Having a healthy cash flow position enables you to pay operating costs such as wages, equipment and rent. An interruption to your income, caused by bad debt, can quickly cripple your business cash flow and is one of the most common reasons for business failure.
- If you know what you have been paid, you can identify shortfalls - Not every insurer payment will cover the full amount invoiced. Identifying the shortfall when allocating payments means you can investigate if this is an error or if you need to charge the patient for the outstanding amount.
- To avoid misunderstandings with patients - Patients can be alienated if your administration appears chaotic and inefficient. For example, it’s polite and professional to acknowledge when a patient has settled their bill and important to notify them promptly if they owe you money. This is difficult if you don’t keep track of what payments you have received, and worse, you could upset a patient by chasing a bill that has already been settled.
- So you can manage your practice better - If you track and allocate payments efficiently, it’s easier to spot worrying trends. If you know late payment is becoming an issue, you can act e.g. by invoicing more promptly, introducing card payments so patients can pay at reception after treatment or using online payment options, such as our integration with patientzone.