Days in accounts receivable (A/R) measures how long it takes, on average, to collect payment after a service is delivered. The longer it gets, the more cash is tied up, and the harder older balances become to collect.
Start by measuring it consistently
You can't improve what you don't measure the same way every month. A common approach is to divide total outstanding A/R by your average daily charges over a recent period. Whichever formula you use, use it consistently and track it alongside your A/R aging buckets (0–30, 31–60, 61–90, 91–120 and 120+ days).
Fix the front end first
A surprising share of slow payments start before the patient is even seen.
- Verify eligibility and benefits before each visit
- Secure prior authorizations ahead of time
- Capture accurate demographics and insurance details at check-in
- Collect copays and known patient balances at the time of service
Clean data at the front end means fewer rejections and denials later.
Submit clean claims quickly
Every day between the visit and submission adds a day to A/R.
Shorten charge lag
Set a clear turnaround target for charge entry, and reconcile completed appointments against entered charges daily so nothing is missed.
Scrub before you submit
A rules-based scrub catches missing data, authorization gaps and payer-specific errors before the payer does. A higher first-pass rate is one of the fastest ways to bring A/R down.
Work A/R by priority, not by age alone
Not every open claim deserves the same attention. Prioritize by:
- Dollar value, so the largest balances are worked first
- Timely-filing risk, so claims nearing payer deadlines are worked before they expire
- Payer behavior, since some payers need earlier and more frequent follow-up
Document every touch on the account so the next follow-up starts where the last one ended.
Don't let denials sit
Unworked denials are among the biggest contributors to aging A/R. Work them promptly, appeal when appropriate, and track root causes so the same issues stop recurring.
Make it visible
Share A/R metrics with practice leadership every month: total A/R, days in A/R, aging buckets and top payers by outstanding balance. Visibility creates accountability, and makes it obvious when something changes.
When to get help
If your A/R keeps creeping up despite your team's best efforts, it may be a capacity problem rather than a process problem. A free revenue audit can identify where balances are stuck and what's realistically recoverable.