The questionWhy do unpaid claims lose value after 90 days?
Short answerUnpaid claims lose value because the chance of collecting drops sharply once A/R is over 90 days old, while every follow-up costs staff time. Instead of average days in A/R, a better measure is how much arrives within 30, 60 and 90 days of the visit, with a target of 80 percent in 30 days. Fixing eligibility, authorizations and documentation, and collecting the patient's share at check-in, speeds that up.
Picture a claim that's 60 days past the visit. By now, someone on your team has probably checked on it. Maybe called the payer. Maybe mailed a statement. Every one of those steps costs staff time.
And the whole time, the clock is running.
Illustrative, not actual figures.
Why this matters to you
The chance of collecting a claim drops sharply once it passes about 90 days from the visit. By about 180 days, it levels off near whatever you'll ever get. Filing deadlines close. Appeals get harder. Patients get harder to reach.
Meanwhile, chasing costs real money. Once staff time is counted, a single follow-up call or mailed statement can cost $25 to $30. For a small balance, you can spend more chasing it than it's worth.
The cheapest claim to collect is the one nobody ever has to chase.
"But our numbers look normal"
They may well be. Your accounts receivable, the money you're still waiting on, might match industry benchmarks. The trouble is, those benchmarks treat a big pile of aging claims as a fact of life.
An average "days in A/R" figure, or even the share of A/R over 90 days, tells you how long the typical claim waits. It tells you nothing about how much came in early, or how many claims like that 60-day one are sitting in the queue.
And there's a catch. A written-off claim leaves A/R right away. A billing team that writes off the hard claims can report an A/R that looks excellent while your practice quietly loses money it earned.
Ask yourselfWhen your A/R looks great, ask what was written off to get it there.
A better question: how much arrives in 30 days?
Instead of asking how long claims wait, ask how much of what you're owed actually shows up fast. It's a sharper test than your net collection rate alone, because it shows speed as well as totals. Here's how to find out.
- Pick a month. Take every visit from one month, at least four months back, so the money has had time to arrive.
- Add up what you're owed. Use the contracted amount for those visits, including the patient's share, not your list prices.
- Add up what arrived, by day. Total the payments received within 30, 60 and 90 days of each visit.
- Divide. What came in within 30 days, divided by what you were owed, is your 30-day rate. Repeat for 60 and 90.
Our target is a 30-day rate of 80% or more. Practices at that level rarely have a backlog or an A/R problem worth talking about.
Ask yourselfOf what you were owed for visits four months ago, how much had arrived by day 30?
Where the fix lives
Most slow money starts before the claim is ever sent: insurance not verified, an authorization missed, a note that doesn't support the code. Fixing those is usually faster, and cheaper, than hiring more billing staff to chase.
It's better for your patients, too. When the last thing your practice does is chase a balance a month after the visit, that's often what the patient remembers. Getting it right at the visit means the last thing they remember is the care.
The cheapest money: collect at the window
Here's one of the biggest leaks, and it happens in plain sight. A patient checks in, gets seen, and walks out without paying her share: the copay, the deductible, the balance from last time.
Now that money becomes a statement. Then a second statement. Then a phone call. Each one costs staff time, and every week it waits, the odds of collecting it drop. Some of it never comes in at all.
The fix is simple to say: know what the patient owes before she arrives, tell her, and collect it at check-in. Practices call this point-of-service collection.
- Before the visit. Verify coverage and estimate the patient's share ahead of time.
- At check-in. Ask for the copay and any past balance, every time, with a clear script your front desk is comfortable using.
- When it's more than she can pay. Offer a payment plan on the spot, instead of sending it to statements.
Patients usually prefer it, too. Nobody likes a surprise bill a month later.
Ask yourselfHow much of what your patients owe was collected at check-in last month?
How Practice Now helps
- We measure what your A/R report doesn't show. Your 30-, 60- and 90-day rates, and your write-offs by reason, side by side, so you see how fast money really arrives and what's quietly disappearing.
- We fix the slow money at the source. Eligibility, authorizations, documentation and collecting the patient's share at check-in, in whatever order gets the most money in the door fastest.
- We aim for 80% in 30 days. Get there, and the backlog, the chasing and the write-offs mostly take care of themselves.
You take care of the patient in front of you. We make sure the visit gets paid while it's still worth something.
Sources Medical Group Management Association (MGMA) DataDive on aging A/R; industry analyses of collection rates by claim age.
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Terms used here are defined in the Practice Performance Glossary.