Is Your Old A/R Worth Working? How to Decide What to Chase and What to Write Off.
An aging report tells you how long a balance has been open. It does not tell you whether that balance is collectible or why it is still there. A claim may have been submitted before a provider’s enrollment was complete. An authorization may be missing. A payment may have been received but posted incorrectly. Charges may have sat too long before submission. By the time the account reaches 120 days, someone is expected to resolve it with a payer call. That call may be necessary, but first, we need to understand what has happened,how it got there, why it took so long to address it and what did we learned from it.
I have reviewed accounts with pages of follow-up notes: calls made, portals checked, claims resubmitted, another follow-up date entered. Yet the notes still do not answer two basic questions: What is the practice actually owed, and what will it take to collect it?
Before assigning another round of follow-up, I want the team to answer six questions:
- Did the payer receive the claim?
- Was it denied or paid, and what does the payer’s response show?
- Is the remaining balance consistent with the contract?
- Is a correction or appeal still available?
- Do we have proof of timely submission?
- Is the balance actually owed by the payer or patient, or was a payment or adjustment missed?
Those answers should lead to one of three decisions:
Work it. Escalate it. Document and adjust.
Work it. The balance is supported, and there is a viable path to payment. Identify the next action, assign an owner, and set a deadline.
Escalate it. The account needs help beyond routine follow-up. That might mean resolving an enrollment issue, obtaining missing records, reviewing an authorization, or addressing a payer processing error. Identify what is needed and who can move it forward.
Document and adjust. The balance needs correction, or no viable collection path remains. Document the reason and route it through the practice’s adjustment approval process.
Age and billed charges alone cannot make that decision. A $20,000 charge may represent only a small remaining contractual payment. A modest balance may be readily recoverable once someone identifies and corrects the issue. Patterns matter, too. Fifty unpaid claims tied to one enrollment issue need a coordinated review. The billing team and practice can determine which claims are recoverable, what needs to be corrected, and how to catch the issue before more claims are affected. The same applies to recurring authorization denials, late charges, unanswered records requests, and unapplied payments. The billing team’s findings can help the practice improve the process while both work toward resolving the outstanding accounts.
There is also a compliance side to this work. Routinely waiving Medicare copayments and deductibles can raise federal anti-kickback and beneficiary inducement concerns. An adjustment based on an individual patient’s financial hardship or unsuccessful reasonable collection efforts is different from automatically clearing patient balances because they have reached a certain age. These circumstances may support an adjustment when applicable requirements are met. A written policy should explain the circumstances that support an adjustment, the documentation needed, and who may approve it.
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Credit balances deserve the same attention. A duplicate payment or overpayment may mean the practice is holding money it is not entitled to keep. The review needs to establish where the credit came from, whether money is owed to a patient or payer, and what refund or reporting requirements apply. Removing the credit from the report does not resolve the obligation.
For that reason, an old A/R review should look at both what is owed to the practice and what the practice may owe back.
Each account should reach a supported decision. If further action is needed, there should be an owner and a deadline. If an adjustment is recommended, the record should explain why. Leaving an account open indefinitely does not preserve revenue. A lower A/R number tells only part of the story. How much was collected? How much was corrected? How much was written off, and for what reasons? Those answers show what the work has accomplished and where further attention is needed.
I review old A/R to recover what we still can and to understand why those balances got there. Every account should end with a supported decision: collect it, escalate it, or approve the appropriate adjustment.
The measure of a successful review is more than a smaller aging report. It is money recovered, balances resolved correctly, and fewer claims aging for the same reasons.
Author
Terry Salz
Director of Compliance & Operations
With more than 30 years of leadership in revenue cycle management, Terry is one of the industry's most experienced voices on billing, compliance, and payer audits. She founded IMB (now part of MBS) in 1996, after years of managing physician practices, and has since supported hundreds of practices. At Integrity One Group, she heads compliance, making and managing systems that ensure every process, claim, and workflow is accurate, audit-ready, and built to withstand payer scrutiny. Her expertise spans coding, payer policy, and audit response, including TPE, RAC, SIU, and UPIC reviews. Her work has been published in Medical Economics. She has taught medical billing as an adjunct professor and spoken at state, regional, and national conferences.
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