Billing Problems We Solve
Reducing High Days in AR
Days in AR is the revenue cycle’s thermometer — useful only when you decompose the fever into the specific delays that add up to it.
Days in AR — receivables divided by average daily charges — summarizes the whole revenue cycle in one number, which is both its power and its trap: a high reading tells you something is slow without saying what. The fix starts with decomposition: how many days come from charge lag, submission lag, payer processing, rework cycles, unworked follow-up, and patient balances — because each segment has a different owner and remedy.
Symptoms
- Days in AR above specialty-typical ranges (often cited: under 35–40 days for well-run practices)
- The number creeping upward across quarters without a volume story
- Month-end cash unpredictable relative to charge volume
- Nobody able to explain which stage of the cycle contributes what
Possible Causes
- Front-of-cycle lag: charges and submissions days behind service
- Rework cycles from rejections and denials adding weeks per affected claim
- Follow-up gaps letting no-response claims sit uncounted weeks
- Patient-responsibility balances aging without statement and collection discipline
- Aged junk in the AR inflating the numerator with dead weight
Operational Impact
- Working capital financed by the practice — every excess day is money the practice lends its payers interest-free
- Decisions made on distorted signals when the metric mixes live receivables with dead inventory
Where Outsourced Support Helps
Compressing days in AR is cumulative discipline across the whole cycle — daily charges and submission, prompt rework, scheduled follow-up, patient-balance workflows — which is the definition of what a production billing operation does. Our revenue cycle management engagements baseline the decomposition and then work each segment, reporting the number and its components monthly.
Honesty note: No billing partner can guarantee recovery amounts or revenue improvements — results depend on your claims, payers, documentation, and deadlines. What we guarantee is disciplined process and honest measurement.
Practical Steps to Fix It
Decompose the number
Measure each segment’s contribution — the diagnosis usually surprises: practices blaming payers often find half their excess days in their own lag and follow-up gaps.
Fix the biggest segment first
Charge lag responds to daily entry discipline; follow-up gaps to cadence; patient aging to statement and estimate workflows — sequenced by impact.
Purge the dead weight
Triage and clear genuinely uncollectible aged AR with documentation, so the metric measures live receivables and improvements show truthfully.
Trend it monthly with consistent definitions
One agreed formula, tracked monthly with segment detail — days in AR only guides decisions when its movement is explainable.
Frequently Asked Questions
What is a good days-in-AR number?
Commonly cited: under 35–40 days indicates a well-run cycle for many specialties, with procedure-heavy and comp-exposed specialties running structurally higher. Your own trend and decomposition matter more than the league table — a stable 45 with clean composition beats a volatile 38 hiding dead inventory.
Our days in AR improved after write-offs — did we actually get better?
Partly bookkeeping: purging dead AR shrinks the numerator without collecting a dollar, which is legitimate hygiene but not cycle improvement. Read the metric alongside net collection rate and segment lags to distinguish real acceleration from balance-sheet cleaning — honest reporting shows both.
Services and Related Problems
Stop managing this problem. Fix it.
Request a free billing assessment and get a clear, no-obligation review of your claims process, denial patterns, and accounts receivable.