What is the industry standard formula for calculating A/R days?

Q: What is the industry standard formula for calculating A/R days? We have struggled with this and our self-pay/workers’ compensation tend to keep us about 48 days. 

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Luke Lambert, CEO of ASCOA: MGMA does an annual bench marking survey and the formula they use for days AR is:  Total AR/(Total annual gross charges)x(1/365)

We also struggle with collecting self pay quickly if we don’t collect it on the day of surgery.  Typically, prior to surgery we work out the payment arrangements and take all forms of payment including Care Credit.  We try to avoid at all costs payments plans with the patients.

Share your thoughts with us about this question by e-mailing Scott Becker (sbecker@mcguirewoods.com) or Rob Kurtz (rob@beckersasc.com).

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