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Receivables Performance Management (RPM) is the strategic process of monitoring, analyzing, and improving how efficiently a healthcare organization collects payment for services rendered. In medical practices, especially in complex areas like behavioral health, effective RPM is vital for maintaining healthy cash flow, minimizing bad debt, and avoiding financial instability. RPM involves tracking accounts receivable (A/R) aging, analyzing payment patterns, investigating root causes of delays, prioritizing collections, and implementing preventive measures such as insurance verification and patient education. Technology plays a key role in this process by automating tracking and follow-ups. Neglecting RPM can result in serious revenue losses, with uncollected balances over 120 days often being written off. Hansei Solutions emphasizes a proactive, data-driven approach that integrates technology and expert support to optimize collections and safeguard financial health.
Revenue is the lifeblood of every healthcare practice—but earning revenue and actually collecting it are two very different things. That’s where receivables performance management comes in.
Receivables performance management (RPM) is the strategic process of monitoring, analyzing, and improving how quickly and completely an organization collects money owed to it. In medical billing, it’s all about keeping your cash flow healthy and minimizing the risk of bad debt.
At Hansei Solutions, we view RPM as essential, especially in behavioral health and other complex specialties where billing can be intricate and payment delays are common. Effective RPM can transform a practice’s financial health, allowing providers to focus less on chasing payments and more on delivering excellent patient care.
In healthcare, accounts receivable (A/R) refers to money owed for services already delivered but not yet paid. Industry benchmarks suggest that healthy A/R should have a majority of outstanding balances collected within 30-60 days. However, in many practices, claims linger far longer, tying up cash and creating financial uncertainty.
High A/R impacts more than just financial reports. Delayed collections can:
Research shows that once A/R ages beyond 90 days, the likelihood of collecting that money drops significantly. Managing receivables proactively is crucial to avoid revenue slipping through the cracks.
Receivables performance management isn’t just tracking unpaid bills—it’s a data-driven process that identifies problems early and prevents issues from repeating. At Hansei Solutions, we approach RPM with a comprehensive, proactive methodology.
One of the core tools in RPM is the A/R aging report, which shows how much money is outstanding and for how long. For example, balances might be grouped into aging buckets like:
These reports highlight trends that signal trouble. A spike in older A/R balances may suggest payor issues, billing errors, or internal inefficiencies.
Tracking how quickly payors or patients pay their bills reveals which accounts are healthy and which require attention. At Hansei Solutions, we analyze:
This insight helps us identify bottlenecks and prioritize efforts where they’ll have the biggest impact.
When receivables are delayed, it’s important to dig deeper and find out why. For example:
Understanding the cause allows us to implement targeted solutions rather than merely treating symptoms.
Not all unpaid balances should receive the same level of attention. At Hansei Solutions, we focus efforts on balances with the highest chance of recovery. That often means working newer balances aggressively and identifying older balances worth pursuing through appeals or follow-up. We also help providers set realistic collection goals based on the nature of their services, patient demographics, and payor mix.
Effective RPM is as much about prevention as it is about collection. Strategies to improve receivables performance include:
Over time, preventive measures reduce the overall volume of receivables at risk.
Modern RPM relies heavily on technology. Revenue cycle management (RCM) platforms can:
At Hansei Solutions, we integrate powerful RCM tools with skilled human expertise, creating a balanced approach that maximizes cash flow while minimizing administrative burden.
Practices that neglect receivables management can face significant risks. Slow collections erode revenue, force practices to borrow to cover operating expenses, and ultimately threaten sustainability. Worse, balances over 120 days old are often written off entirely, representing permanent revenue loss.
It is estimated that practices lose an average of 3-5% of revenue annually due to uncollected accounts. In a $5 million practice, that could mean $150,000-$250,000 left on the table each year.
A healthy A/R profile generally has the majority of receivables collected within 30-60 days. Practices with higher percentages of aged balances may face cash flow challenges.
At a minimum, A/R aging reports should be reviewed monthly. However, practices facing high denial rates or cash flow issues may benefit from weekly reviews to identify and address problems sooner.
The longer a balance sits unpaid, the less likely it is to be collected. Patients may forget about bills, move without leaving forwarding addresses, or become unwilling to pay old balances. Similarly, payors may impose strict time limits for claim resubmission, causing older claims to be permanently denied.
Technology plays a crucial role in RPM, but human expertise remains essential. Software can identify trends, flag risks, and automate reminders, but experienced professionals are needed to analyze data, appeal denials effectively, and handle complex cases.
Clear communication and timely billing reduce patient confusion and frustration. When patients understand their financial responsibilities upfront and receive accurate statements, they’re more likely to pay promptly and maintain trust in the practice.
At Hansei Solutions, we specialize in helping behavioral health providers and other complex practices strengthen their receivables management. Our services include:
Our goal is to help you maintain a healthy cash flow so you can focus on patient care without the constant worry of delayed payments. Contact us today to learn more.
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