Accounts Receivable (AR) is the financial lifeblood of your private practice. If your claims are aging past 45 days, your cash flow is actively depreciating. According to the Medical Group Management Association (MGMA), the average small practice leaves up to 15% of its total revenue on the table due to unworked aging AR. Here is your evidence-based 2026 playbook to accelerate AR recovery and collect every dollar you are owed.
The Staggering Cost of Ignoring AR
For a small medical practice, uncollected AR isn’t just a spreadsheet error—it is the difference between expanding your practice and struggling to meet payroll. The Healthcare Financial Management Association (HFMA) reports that it costs an average of $25 to $30 to rework a single denied claim. Worse, 65% of denied claims are never appealed. Proactive AR recovery services are no longer optional; they are a survival necessity.
The Aging AR Cliff: Probability of Collection by Claim Age
The longer a claim sits in your AR report, the drastically lower your chances of getting paid become.
Data Source: Industry Averages compiled by HFMA & MGMA (2025)
The 7-Step Playbook for Rapid AR Reduction
Unlike massive hospital systems, small practices cannot afford to write off 10% of their claims. To maximize revenue, you must implement tight controls at every stage of the patient journey. Here are seven practical tips you can implement this week.
Master Front-End Eligibility Verification
Over a quarter of your billing problems start at the front desk. If a patient’s insurance has lapsed, or if they require a prior authorization that wasn’t obtained, no amount of back-end AR work will save that claim. It will be denied immediately.
Action Step: Verify insurance 48 hours before the appointment. If you lack the staff to do this consistently, consider utilizing dedicated insurance eligibility verification services to ensure every patient who walks through the door is covered.
Optimize Your Charge Entry Process
A delayed claim is a delayed payment. “Charge entry” is the process of translating a patient visit into billable codes. If your providers are taking days to close out their encounter notes, your AR clock hasn’t even started ticking yet.
Action Step: Implement a strict 24-hour rule for locking clinical notes. Accurate coding prevents downcoding and audits. For specialty practices, outsourcing charge entry services ensures that modifiers are applied correctly the first time, preventing immediate payer rejections.
Strict Adherence to Timely Filing Limits
In 2026, insurance companies are tightening their margins. If you miss a payer’s timely filing deadline, the claim is instantly denied, and you cannot bill the patient for the balance. While Medicare allows 365 days, some commercial payers require submission within 90 days.
Action Step: Audit your clearinghouse reports daily. Familiarize your billing team with the exact timely filing limit for claims in medical billing for your top five payers. Set automated alerts for claims approaching the 60-day mark.
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Aggressive Denial Management
Do not let denied claims sit in a pile. The longer a denial ages, the harder it is to overturn. Many practices lose thousands of dollars simply because they don’t have the staff bandwidth to call insurance companies and argue over codes like CO-16 (Claim Lacks Information).
Action Step: Institute a policy where all denials are reworked within 48 hours of receipt. If your in-house team is drowning, professional healthcare denial management services can systematically appeal and recover those lost funds.
Decode EOBs and Post Payments Accurately
Improper payment posting creates “ghost AR”—balances that look like they are owed by the patient, but are actually contractual write-offs. When this happens, patients get angry, and your AR report becomes mathematically useless.
Action Step: Train your staff thoroughly on how to read Claim Adjustment Reason Codes (CARCs). Knowing the difference between a PR (Patient Responsibility) and a CO (Contractual Obligation) is vital. Read our comprehensive guide on what an EOB is in medical billing to train your team.
Maintain Flawless Credentialing
You can have perfect coding and instant claim submission, but if a provider’s CAQH profile expires, or if their Medicare revalidation is missed, 100% of their claims will be denied. Credentialing lapses are silent killers of cash flow.
Action Step: Never let credentialing slip through the cracks. Maintain a centralized roster of all expiration dates. For total peace of mind, utilize a dedicated insurance credentialing service to handle the endless paperwork, CAQH attestations, and payer follow-ups.
Know When to Outsource
Small practices often force their front desk staff to juggle patient care, scheduling, and complex medical billing. This multi-tasking leads directly to billing errors and bloated AR buckets. Specialized billers know how to aggressively chase down unpaid claims.
Action Step: Run a cost-benefit analysis. Often, paying a percentage of collections to a specialized firm yields a higher net revenue than paying a fixed hourly wage to an overwhelmed in-house employee. Explore the medical billing services for small practices that cater specifically to your specialty.
Frequently Asked Questions
What is a healthy AR days average?
For most medical practices, keeping your Days in AR under 35 days is considered excellent. If your average stretches beyond 50 days, it is a massive red flag indicating systemic issues in your claim submission or denial management workflow.
Why are claims from new providers constantly denied?
This is almost always a credentialing issue. If a provider starts seeing patients before they are fully linked to the practice’s group contract, the payer will deny the claim as out-of-network. Ensure you have proper physician credentialing processes in place before a new hire’s start date.
What is the ‘Over 90 Days’ AR Bucket?
This refers to claims that have gone unpaid for more than 90 days since submission. As illustrated in the chart above, the probability of collecting on claims drops dramatically after 90 days, falling below 45%. This bucket requires immediate, aggressive follow-up.
