How to Audit Mental Health A/R Over 30, 60, and 90 Days

Age tells you how long, not why

An aging report answers one question: how long has this been outstanding. It is a useful triage tool and a poor diagnostic one, because two balances of the same age can have nothing in common.

A claim sitting at 62 days because the payer has it and has not finished, a claim sitting at 62 days because it was denied on day 9 and nobody worked it, and a balance sitting at 62 days because it is the patient’s share and no statement has gone out are three different problems. Sorted by age they look identical.

So run the report by age to decide where to start, then immediately re-sort what you find by cause.

What each bucket usually means in a behavioral health practice

• Under 30 days. Mostly normal float. What matters here is not the balance but the exceptions: anything already rejected or denied in this bucket is late, not early.
• 30 to 60 days. The bucket where process failures become visible. Claims that were rejected and never resubmitted, denials nobody has triaged, authorizations that lapsed mid-episode.
• 60 to 90 days. The bucket where the cause is usually already known and unactioned. If a claim reaches here without a documented next step, the problem is workflow rather than payer behaviour.
• Over 90 days. Some of this is genuinely still moving: appeals, coordination of benefits, secondary billing. The rest is the practice’s honest write-off risk, and it is worth separating those two before anyone talks about “bad debt”.

Timely filing is the deadline that quietly converts the third and fourth buckets into permanent losses, and it varies by payer and by contract. A balance that is merely old is recoverable; a balance past filing is not.

Re-sort by cause, in five groups

Take whatever the aging report gave you and put every line into exactly one of these:

1. Never arrived. The payer does not have the claim. A rejection was missed, or the file never went. A claim status enquiry answers this: ASC X12N 276/277 is the adopted standard for a claim status request and response.¹
2. Arrived, still in process. Genuinely waiting. Note the date and stop touching it.
3. Adjudicated and denied. There is a decision and a reason code. This is appeal or correction work, not follow-up work.
4. Adjudicated and underpaid. Paid, but not at the contracted rate. This group is the one practices miss, because the claim looks closed.
5. Patient responsibility. Copay, coinsurance or deductible, identified on the remittance by the PR group code.² This is a statements and collections problem, not a payer problem.

Those five groups go to different people and different processes. An aging report that has not been split this way sends everything to one person, who works it in the order it happens to be sorted.

What to do with each group

• Never arrived: establish whether the payer has it before resending anything. Resubmitting a claim the payer already holds usually produces a duplicate rejection.
• Still in process: set a review date based on that payer’s usual turnaround and leave it alone until then.
• Denied: read the adjustment reason code and the remark code beside it before deciding whether this is a correction or an appeal.²
• Underpaid: compare the paid amount to the contract, not to the charge.
• Patient responsibility: get it onto a statement and a payment plan. It is not going to resolve itself in the aging report.

The audit is worth running monthly, and its output is a pattern

One month of this tells you what is outstanding. Three months tells you which of the five groups keeps refilling, and that is the finding worth acting on.

If group one refills every month, the problem is that rejections are not being seen. If group three refills, denials are being worked one at a time without anyone asking why the same denial keeps arriving. That is the question VixisTrace™ is built to answer, and it is a different question from “what is outstanding”.

Deeper reading: insurance aging report analysis and how to recover aging medical receivables.

Related reading

• Insurance aging report analysis
• How to recover aging medical receivables
• A rejected claim is not a denied claim
• Mental health billing and revenue cycle management