A/R Best Practices: How to Lower Your Days in A/R

Days in accounts receivable (A/R) measures how long, on average, it takes your practice to get paid after a service is billed. The higher the number, the longer your revenue sits with payers and patients instead of in your bank account.

How to calculate days in A/R

Divide your total outstanding A/R by your average daily charges over the last three to six months. Many practices aim to keep days in A/R under 40, although the right target depends on your specialty and payer mix.

Seven habits that keep A/R low

1. Submit clean claims quickly

Every day a claim is not submitted is a day added to A/R. Aim to send claims within 24–48 hours of receiving charges, and scrub them against payer edits first.

2. Work A/R by aging bucket

Split outstanding claims into 0–30, 31–60, 61–90 and 90+ day buckets. Give priority to high-value claims that are approaching timely filing limits.

3. Follow up before claims go quiet

If a claim has no response after the payer’s normal processing time, check its status. Waiting for a denial letter costs weeks.

4. Fix denials at the root

Appeal or correct each denial quickly, and track the reason. A repeat reason points to a process that needs fixing upstream.

5. Post payments accurately

Post ERAs and EOBs promptly and flag underpayments against your contracted rates. Incorrect posting hides balances that should be followed up.

6. Make patient balances easy to pay

Clear statements and online payment options shorten the time patients take to pay their share.

7. Review A/R every month

Look at the trend, not just a single number. A slow rise in days in A/R is an early warning sign.

Conclusion

Lowering days in A/R is about consistency: fast submission, steady follow-up and fixing the causes of denials. If your older buckets keep growing, a focused A/R cleanup can recover revenue you may have already written off.