Abstract
This paper talks about the significance of finance for medical office. Patient care is an important medical facility that can be made effective through appropriate financial responsibilities. It considers difference between billable revenue and collections. It also talks about advantages and disadvantages of using computerized banking for a medical office and thoughts regarding comparison of computerized banking and paper banking. This paper also includes that how standard banking is safer and better than computerized banking.
Difference between Billable Revenue and Collections
There are two types of medical practices that consider two different types of patients. These patient types include walk-in patients and corporate patients. Billable revenue is the money that is received from the patients for the services or care that is provided by the healthcare organization to them. Billable revenue may either help or hurt the patient in different conditions (McClatchey, 2001). It helps the patient, when he/she is able to pay the amount for the services and care, but when patient is not able to pay; it turns into collection and hurts them. Billable revenue is the revenue to the practice. On the other hand, collections are money that is to be received from the patients, but they have inability to pay for any kind of service or care. Collections may have different means from person to person. For example, the mean of collections for cashier is day to day collections from the patients, because cashier tally the amount daily (Dunham-Taylor & Pinczuk, 2006). Collections almost certainly mean the cash flow of practice for the boss to determine that how much money came in a month.
Hindering by a Disparity between Receivables and Collections
A medical office might have two areas to be hindered by a disparity between receivables and collections. First, a medical office may separate collections and receivable that put strain on the resources and cost of office for a long time period. It would make clear about what is owed by receivables and what is owed by collection. The separation of receivables and collections may be difficult in initial stage (Melicher & Norton, 2010). The process of receivables may take a long time that could hinder the collection process, which increases the expenses for the office. At the same time, there is another option for medial office to shot out collections and receivables with the help of an outside organization. For example, medical office may hinder the receivable through insurance companies, but again it would increase expenses of the office (Wager, Lee, & Glaser, 2009). It is because the office has to pay a lot of amount of office collection to the insurance companies and also take a long time to process through claim. Hence, the medical office would be more hindered rather than helped to separate or differentiate receivables and collections.
Collection of 60 Days Past Due Date Bills
A medical office goes about collecting bills that are 60 days past due. First, it should send a notice once the due date has been past and the notice should be sent out at 60 and 90 days. During this time period, office must make attempts to reach to the party by making phone calls or use any other way (Spors, 2008). In addition, it is also important to send monthly statement to the party after 45 days. After 60 days past due, it is difficult to start drop the recovery, but still office have chance to regain the amount. The office should send a series of three or four demand letters with every 10 days. It would be remembered to the party that client is handled over to a collection agency to recover the collection. The office must hand over 60 days past due account to a collection for the collection process. It is because after 100 days, it is not possible to hand over the collection process to a collection agency and it can be lost by the office (Fordney, French & Follis, 2007). Along with this, it is a good approach to collect debt by making good relationship with the patients to recover the money.
Advantages and Disadvantages of Using Computerized Banking
The use of computerized banking has both advantages and disadvantages for a medical office. Computerized banking is more important for a medical office rather than a systematic or manual banking. It is because systemic banking uses physical handling of checks, which can be more risky and security-prone to the medical office (Dunham-Taylor & Pinczuk, 2006). So, the medical office can lose crucial information. Computerized banking is helpful to determine any inconsistency in any financial transaction. Along with this, it is also significant to track and get all the records of the transactions that are made by the medical office. All these transactions can be made on behalf of medical administration and patients of the office. It also ensures about timely billing and payment on demand and provides paperless statements, ease of deposits, payroll and ACH and multiple people can access account. On the other hand, it also has some disadvantages such as security issues, signals, faulty devices, delayed statements, internet connection and loss of human touch (Wager, Lee & Glaser, 2009). Computerized banking creates security issues, because banks are protected with firewall that can be break within their network. It also reduces interaction with people, who are associated with banking experiences.
Standard Banking and Computerized Banking
Standard banking is quite safe and secure banking rather than computerized banking. It is because computerized banking cannot identify the theft concern and increases security measures along with accessibility of anti-virus and anti-spyware programs. Now a day, anyone can hack and phish the online accounts of the customers of the banks (Ennew & Waite, 2012). On the other hand, clients and consumers hand over valuable items in their safety deposit boxes with the help of bank representative or bank manager with their physical presence. At this time, local banks can interact with their customers at individual level. In standard banks, consumers are more protected in terms of their identity theft. For example, physically taking of check to a bank is more secure that requires identify proof to withdraw check or cash. Banks are also using surveillance cameras and engaging a larger number of security guards to increase the security (Narayan-Parker, 2002). Criminal cannot rob a bank by holding a gun to one’s personal computer with the standard way. Thus, standard banking is better than computerized banking in concern of protection from identity theft aspect of banking.
d ed.). USA: John Wiley & Sons.