Aging (0-30, 31-60, 61-90, 91-120, Over 120) all track outstanding Insurance and Patient Receivable, segmented by the number of days they have remained unpaid from the Transaction Date. These metrics include balances from both active and inactive providers and are not impacted by receipt collection, but rather by how collected receipts are allocated to procedure codes. Aging is calculated based on Treatment location and Treatment provider.
- Aging (0-30): Aging (0-30) all track outstanding insurance and patient receivables, that have been unpaid for up to 30 days from the Transaction Date. This bucket typically represents the healthiest segment of accounts receivable because payments in this range are considered most likely to be collected without additional follow-up. have remained unpaid.
- Aging (31-60): Aging (31-60) includes slightly overdue balances, often due to minor processing delays, insurance verification, or slow patient payments, highlighting the need for proactive follow-up.
- Aging (61-90): Aging (61-90) signifies increasing financial risk, as balances in this category are more likely to experience delays from claim denials, pending patient payments, or administrative inefficiencies. Monitoring this metric helps practices identify problem areas in revenue cycle management and prioritize collections before accounts become severely overdue.
- Aging (91-120): Aging (91-120) represents significantly overdue receivables that require immediate follow-up to avoid revenue loss. A high value in this category suggests inefficiencies in collections or unresolved claim disputes. Addressing these balances promptly through claim resubmissions or patient outreach can prevent further aging.
- Aging (Over 120): Aging (Over 120) includes severely overdue balances that are at high risk of being uncollectible. As accounts move into this category, they become increasingly difficult to collect, often requiring escalated follow-up, collection agency involvement, or write-offs. A high percentage of receivables in this bucket indicates inefficiencies in the revenue cycle and may require process improvements in claim tracking and patient payment strategies.
- Patient Aging: Patient Aging tracks unpaid patient balances across all aging categories including contracted balances (balances from codes linked to payment plan). High patient aging indicates challenges in collecting self-pay amounts, such as copays, deductibles, or out-of-pocket expenses. Since patient payments are often more difficult to collect than insurance reimbursements, monitoring this metric helps practices enforce effective payment policies, such as upfront collections, automated reminders, and financial assistance options. High patient aging can indicate issues with billing transparency, follow-up procedures, or payment plan adherence.
- Insurance Aging: Insurance Aging tracks unpaid insurance balances from insurance carriers across all aging categories. This metric is essential for tracking outstanding claims and identifying reimbursement delays due to pending approvals, denials, or processing errors. Since insurance payments make up a significant portion of dental practice revenue, high insurance aging suggests potential inefficiencies in claims submission, follow-ups, or appeal processes. Regular analysis of this metric helps practices reduce claim aging, improve cash flow, and prevent unnecessary write-offs.
- Total Aging: Total Aging represents the complete Accounts Receivable (AR) balance, including insurance receivables, patient balances, and contracted balances (balances from codes linked to payment plan). This metric provides a holistic view of financial health, helping practices assess revenue cycle efficiency. A high percentage of aging over 90 or 120 days indicates a need for more efficient claim follow-ups, patient payment enforcement, or better financial policies. By regularly reviewing total aging, dental practices can improve their cash flow, revenue cycle efficiency, and overall financial stability.
Other AR Related Metrics
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Inflated Ortho Aging: Inflated Ortho Aging represents the total outstanding balance from orthodontic procedure codes that have been checked out but are not associated with an Ortho plan. Since Ortho treatments are typically managed through structured payment plans, any Ortho codes billed outside of a plan can lead to inaccurate aging balances and potential revenue tracking issues.
- Monitoring this metric helps practices:
- Ortho treatments being billed without a formalized payment plan
- Incorrect categorization of procedures, leading to inflated receivables
- Potential billing or claim submission errors
- High values in this category may indicate the need for billing corrections, plan adjustments, or better tracking of Ortho treatments within the practice management system. Regular monitoring ensures that orthodontic revenue is accurately reflected and appropriately managed.
- Inflated Ortho Aging is calculated based on Treatment location and Treatment provider.
- Monitoring this metric helps practices:
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Insurance AR Days: Insurance AR Days (Accounts Receivable Days) measures the average number of days it takes for insurance claims to be paid after initial submission. This metric is a key indicator of the efficiency of your practice's claims processing and reimbursement cycle.
- It is calculated considering only currently closed claims that had initial submission in the date selected, and calculates the number of days it took to close these claim. A higher number of AR days suggests delays in insurance payments, often due to issues such as:
- Claim denials or rejections
- Delays in payer processing
- Inaccurate claim submissions or missing information
- By tracking Insurance AR Days, dental practices can identify bottlenecks in the revenue cycle, implement timely follow-up on unpaid claims, and improve cash flow. Typically, lower AR Days indicate a faster and more efficient claims process, helping practices maintain healthy financial operations.
- This metric is calculated based on Claim Location, Treatment Provider.
- It is calculated considering only currently closed claims that had initial submission in the date selected, and calculates the number of days it took to close these claim. A higher number of AR days suggests delays in insurance payments, often due to issues such as:
| Note: If there are no claims that are in closed status, that had initial submission in the selected date range, this metric would not show any value. |
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Day Sales Outstanding: Days Sales Outstanding (DSO) is a key financial metric that measures the average number of days it takes for a practice to collect payment after a service is provided. It includes both patient payments and insurance reimbursements and is calculated by dividing the total accounts receivable by the average daily revenue.
- Day Sales Outstanding = Total Aging / Average Daily Revenue, where Average Daily Revenue = Gross Production (TXN)/ Number of days in the selected date range.
- A lower DSO indicates a quicker collection process, suggesting that the practice is efficiently converting its sales (or production) into cash. Conversely, a higher DSO may signal:
- Slow collections, either from patients or insurance
- Inefficiencies in billing and payment follow-up
- Potential issues with insurance claims processing or patient payment plans.
- Monitoring DSO helps practices understand the effectiveness of their revenue cycle management and provides insights into cash flow health. By reducing DSO, practices can improve their financial stability and operational efficiency.
Related Articles
- Claims Metrics
- Gross and-Net Production Metrics
- Other Production Metrics
- Gross and Net Collection Metrics
- Other Collection Metrics
- Patient Metrics
- Appointment Metrics
- Treatment Related Metrics
Practices can use this simple guide to learn all about aging-related metrics.