Dental Accounts Receivable
How Dental Practices Can Improve Accounts Receivable
A healthy accounts receivable process helps dental practices collect earned revenue more consistently, reduce aging balances, and maintain more predictable cash flow. This guide explains practical ways U.S. dental practices can improve AR management and strengthen their revenue cycle.
A practical guide for U.S. dental practices
What Is Dental Accounts Receivable?
Dental accounts receivable, commonly called dental AR, represents money that is owed to the practice but has not yet been collected. These balances can include outstanding insurance claims, patient balances, unpaid invoices, and other amounts that remain open in the practice's accounts.
Managing AR effectively means more than simply looking at the total outstanding balance. Practices need to understand how old the balances are, why they remain unpaid, who is responsible for payment, and what action is required to resolve them.
A structured dental AR recovery process can help practices prioritize outstanding balances and improve collection workflows.
Why Is Accounts Receivable Important for Dental Practices?
A practice can have a strong patient schedule and still experience cash-flow problems when earned revenue is not collected efficiently. Aging accounts can tie up cash and require staff to spend additional time researching claims, contacting insurance carriers, and communicating with patients.
Effective AR management helps practices identify outstanding balances earlier and establish consistent follow-up procedures. It also gives practice leadership better visibility into the financial health of the revenue cycle.
Improve Cash Flow
Collecting outstanding balances consistently can help practices maintain more predictable cash flow.
Reduce Aging
Early follow-up can help prevent unpaid balances from becoming increasingly difficult to resolve.
Improve Visibility
A structured AR process gives practice leadership better information about outstanding revenue.
Reduce Administrative Work
Clear workflows can help staff spend less time repeatedly researching unresolved balances.
Understand Your Dental AR Aging
AR aging helps practices understand how long outstanding balances have remained unpaid. The exact aging categories used by a practice can vary, but reviewing balances by age can help identify which accounts need attention first.
0–30 Days
Recently outstanding balances that should be monitored and followed up according to the practice's workflow.
31–60 Days
Balances that may require more active follow-up to prevent unnecessary aging.
61–90 Days
Older balances that may need additional review and focused collection action.
90+ Days
Aging balances that often require prioritized review to determine the appropriate next step.
Practices should avoid treating every AR balance the same. Prioritization based on age, balance, payer, claim status, and other relevant factors can make follow-up more organized and efficient.
Follow Up on Outstanding Insurance Claims
Insurance claims are a major part of many dental practices' accounts receivable. A claim that remains unresolved can delay payment and increase the amount of work required to collect the revenue.
Practices should establish a consistent process for identifying unpaid claims, reviewing claim status, determining the reason for nonpayment, and taking the appropriate next action.
Identify Unpaid Claims
Maintain visibility into claims that have been submitted but have not yet resulted in payment.
Review Claim Status
Determine whether the claim is pending, denied, rejected, under review, or requires additional information.
Take Appropriate Action
Follow the payer's process for correcting, resubmitting, appealing, or otherwise resolving the claim.
Document Follow-Up
Maintain clear records of follow-up activity and the next action required.
Consistent claim follow-up works closely with effective dental claims management and helps prevent outstanding insurance balances from being overlooked.
Address Denied Claims Quickly
Denied claims can become a significant source of aging AR when they are not reviewed and followed up consistently. Practices should identify the reason for the denial and determine the appropriate action as quickly as practical.
Effective dental denial management can help practices organize denied claims, identify recurring problems, and improve the overall revenue cycle process.
Questions to ask when reviewing a denial
- • Why was the claim denied?
- • Can the issue be corrected?
- • Is additional documentation required?
- • Does the claim need to be resubmitted or appealed?
- • Is there a deadline for additional action?
- • Is this denial part of a recurring pattern?
Improve Patient Balance Collections
Patient balances are another important part of dental accounts receivable. Clear communication about expected responsibility, accurate account information, and consistent collection procedures can help practices manage patient balances more effectively.
Practices should establish clear procedures for communicating balances, answering patient questions, documenting payment arrangements when applicable, and following up on unresolved balances.
Provide clear financial information
Keep patient account information accurate
Respond to billing questions consistently
Document payment arrangements appropriately
Follow established collection procedures
Monitor unresolved patient balances
Keep Payment Posting and Account Reconciliation Accurate
Accurate payment posting is important because practices need reliable account information to understand what has been paid, what remains outstanding, and whether balances have been applied correctly.
Inconsistent posting or reconciliation can make AR reports less reliable and may create additional work when staff have to investigate account discrepancies.
Measure the Health of Your Dental AR
Practices cannot improve what they do not measure. Reviewing a consistent set of AR metrics can help leadership understand where revenue cycle performance is improving and where additional attention may be required.
Total accounts receivable
AR aging by category
Outstanding insurance balances
Outstanding patient balances
Denial volume and value
Collection performance
Unresolved claims
Follow-up activity
Reviewing these metrics regularly can help practices identify trends before aging balances become more difficult to resolve.
A Practical Plan to Improve Dental Accounts Receivable
Improving AR does not have to begin with a complete change to the practice's billing operation. A structured review can help identify the areas with the greatest opportunity.
Step 1: Review Aging
Identify how much outstanding AR is in each aging category.
Step 2: Find the Largest Balances
Prioritize significant outstanding balances for appropriate review and follow-up.
Step 3: Review Denials
Identify recurring denial reasons and determine whether workflow changes could prevent them.
Step 4: Review Unpaid Claims
Identify insurance claims that remain unresolved and establish clear follow-up actions.
Step 5: Review Patient Balances
Evaluate how patient balances are communicated, documented, and followed up.
Step 6: Track Results
Monitor AR metrics over time to determine whether collection efforts are improving.
For practices that need additional support, a dedicated revenue cycle partner can help manage appropriate parts of the AR workflow while the practice continues focusing on patient care.
Dental Accounts Receivable FAQ
Frequently Asked Questions
What is dental accounts receivable?
Dental accounts receivable is money owed to a dental practice that has not yet been collected. It can include outstanding insurance claims, patient balances, and other unpaid amounts.
How can a dental practice reduce aging AR?
Practices can focus on timely claim follow-up, denial resolution, accurate payment posting, patient balance communication, and consistent monitoring of aging accounts.
What is dental AR recovery?
Dental AR recovery refers to the process of reviewing and following up on outstanding balances to help a practice collect revenue that remains unpaid.
Can outsourced dental billing help with accounts receivable?
Depending on the service arrangement, an outsourced dental billing partner may support insurance follow-up, denial management, patient balance workflows, reporting, and other accounts receivable activities.
NEXTGEN HUB
Need Help Improving Your Dental AR?
NEXTGEN HUB supports dental practices with accounts receivable recovery, dental billing, denial management, insurance verification, and other revenue cycle workflows.