It’s Monday morning at Dr. Know-it-all’s cardiology practice, and everyone is celebrating.
Well, almost everyone.
Holly, the practice administrator with CPC credentials and enough confidence to run a hospital, has just presented her monthly financial report.
“Collections are up 12%! We brought in $103,000 last month!”
Dr. Know-it-all practically jumps out of his chair.
“Excellent! I told you our billing department was doing great!”
Jill, sitting at the front desk, looks up from an insurance card that expired 6 months ago.
“Does this mean we’re getting bonuses?”
Nobody answers.
Meanwhile, Sasha is reviewing the same financial reports.
“Interesting. How much of that $103,000 came from older claims?”
Holly smiles.
“Well, our overall revenue cycle performance is trending positively.”
Sasha looks up.
“That wasn’t my question.”
The Numbers Start Talking.
The practice collected $103,000 last month. That’s real money sitting in the bank, and nobody is complaining about getting paid.
But Sasha notices something Holly’s presentation conveniently left out.
The accounts receivable report shows $72,000 in claims over 90 days old.
Some haven’t been touched in months.
Others were rejected by the clearinghouse and never corrected.
And several accounts have adjustments that don’t match the insurance’s explanation of benefits.
Sasha opens the adjustment report.
“Holly, why was this $2,400 balance written off?”
“Probably a contractual adjustment.”
“Probably?”
Holly adjusts her glasses.
“Well, that’s what the system shows.”
Sasha pulls up the insurance remittance.
The contractual adjustment is already posted. The remaining $2,400 was an unpaid insurance balance that someone wrote off without documenting why. No denial review. No payment investigation. Just another adjustment.
Wonderful. Apparently, the EHR billing software has developed the ability to make money disappear.
The Investigation Gets Interesting.
Sasha keeps digging.
Several claims marked as submitted never made it through the clearinghouse.
Others were accepted but denied by the insurance carrier, with no follow-up documentation.
And a few older claims are approaching their appeal deadlines.
Meanwhile, Holly’s monthly report proudly displays the $103,000 in collections without mentioning any of this.
Dr. Know-it-all walks over.
“What’s the problem? We’re getting paid.”
Sasha turns her laptop toward him.
“You’re looking at what’s coming in. I’m looking at what should have come in but didn’t.”
Holly interrupts.
“Our collections increased 12% compared to last month.”
“Wonderful,” Sasha replies. “But your unpaid claims over 90 days increased 18%. Should we celebrate both?”
Silence.
Even Jill stops asking about bonuses.
A Report Is Not an Investigation.
Here’s what Holly’s report didn’t explain.
The practice collected $103,000, but that number alone doesn’t tell anyone whether the revenue cycle is performing well.
A bank deposit tells you money arrived.
It doesn’t tell you whether every claim was processed correctly, whether payments matched contracted rates, or whether collectible balances are being lost.
And a claim marked “submitted” doesn’t mean the insurance carrier accepted it.
That’s why experienced RCM professionals don’t just look at collection totals. They examine aging reports, clearinghouse rejections, payer denials, payment variances, and adjustments to understand what’s happening behind those totals.
The Final Diagnosis.
Dr. Know-it-all stares at Sasha’s findings.
“So you’re telling me Holly’s reports are wrong?”
“No,” Sasha replies. “I’m telling you they’re answering the wrong question.”
Holly closes her PowerPoint presentation.
Dr. Know-it-all looks confused.
“So we’re making money, but we’re also losing money?”
Sasha closes her laptop.
“Congratulations, Doctor. You’ve finally understood the revenue cycle.”
And somewhere at the front desk, Jill is still waiting to hear about those bonuses.
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