As well as cash flow being an essential indicator of the health and success of your healthcare practice, it can influence business strategies and any decisions as to where your practice needs improvement. If used well, cash flow analysis can be a better tool to understand your finances and your business’s future direction. It can be a great asset to your healthcare practice, and employing it right can put your business in good standing.
However, this isn’t as easy as it sounds. Collecting owed money is a process that has become increasingly difficult in healthcare. For instance, in the last two months, FICO has de-emphasized medical debt on credit scores, meaning that money that patients owe to hospitals and healthcare professionals does not influence credit ratings as they used to. They have become less significant, with around 30% of Americans also having inactive account collections, contributing to this pressure.
Healthcare practices should now be prepared to compete for collectible money, which previously was not a significant priority nor concern. This means staying on top of patient accounts with delayed pay and employing new tools to ensure cash flow efficiency with your accounts receivable sitting at a reasonable to a high number. All financial concerns, such as medical coding and billing, must also be continually monitored at a high level.