Chapter 15- Financial Systems- Accounts Receivable

Elsevier items and derived items Copyright © 2016, 2011 by Mosby, Inc., an affiliate of Elsevier Inc. All rights reserved.
Financial Systems:
Accounts Receivable
Chapter 15
1

Financial Systems:
Accounts Receivable
1. Define the key terms in this chapter.
2. Explain basic mathematical procedures and
how to use decimals and percentages.
3. Describe common bookkeeping systems in
dentistry.
4. Identify special bookkeeping situations that
can occur in a typical day and identify their
solutions.
Lesson 15.1
2

Financial Systems:
Accounts Receivable (Cont.)
5. Explain the production of patient statements
and discuss identity theft.
6. Discuss the importance of establishing
financial arrangements and the functions of a
credit bureau.
7. Discuss the rules for collecting late payments
and the function of a collection agency.
Lesson 15.1
3

Bookkeeping Systems
 Two types of financial systems are used in
the dental office:
 Accounts receivable
 Accounts payable
4

Accounts Receivable
 Includes all production
 Data are entered for:
• Treatment rendered to patients
• Payment received
• Calculations for new balances
 Computation of the data leads to determination of
the amount of the current accounts receivable
5

Accounts Payable
 Includes all financial obligations, or money
that is owed by the dentist (outgoing money)
6

Financial Records
 Protection for both the dentist and patient
 Information for tax purposes
 Data for business analysis
7

Financial Records
 Bookkeeping
 The recording of financial transactions
 Accounting
 The recording, classifying, and summarizing of
financial and business records
8

Mathematical Computations
 Enter data accurately
 Avoid embarrassment
 Avoid patient dissatisfaction
 Reduce possibility of loss of cash flow
 A technological failure means computations
must be done manually
9

Decimals
Correct: 0.5 Incorrect: 0.5
2.8 2.5
+ 30.50 + 30.50
33.80 60.50
10

Decimals
600.75 2 decimals (multiplicand)
× 0.20 2 decimals (multiplier)
120.1500 2 + 2 = 4 decimals
11

Percentages
5% = 5 = 1
100 20
7.5% = 7.5 = 75 = 3
100 1000 40
15% = 0.15
12

Percentages
$ 670
× 0.80
$ 536
13

Computerized Bookkeeping System
 A single entry can be transferred to a:
 Financial record
 Patient statement
 Insurance form
14

Components of a Computerized
Bookkeeping System
 Opening the program
 Locating account information
 Editing account information
 Adding, inactivating, or transferring a patient
15

Bookkeeping System
 Name or ID number
 The provider
 Patient’s address, telephone number
 Personal data (Date of birth, gender, and
age)
 Social Security number
 Employment and insurance notes
 Preferred pharmacy
16

Patient Information Screen
17
Courtesy Patterson Dental, St. Paul, Minnesota.

Walkout Statement
18
Courtesy Patterson Dental, St. Paul, Minnesota.

Bookkeeping System
 Backing up data
 Prevents loss of information
 Use CD-ROM, DVD, external hard drive, or other
storage device
 Use off-site backup service through the Internet
19

Special Situations
 Credit balance
 Nonsufficient funds (NSF) check
 Courtesy discount
 Debit and credit cards
 Healthcare credit cards
20

Statements
 Indicate the charges, payments, and
balances of accounts for the preceding month
 Usually sent once per month
 May be on the same day (first, fifteenth, thirtieth)
 May be on a staggered basis according to the
alphabet (suggested for large practices to
maintain a better cash flow)
21

Identity Theft
 Be mindful of unknown individuals
 American Dental Association information
 Online search for the latest information
22

Establishing Financial Arrangements
 Conform to community standards
 Reflect the attitude of the dentist toward the
patient’s welfare
 Represent sound business concepts
 Present in written form to the patient
 Provide options to the patient
 Policy should be followed all times
23

Types of Payment Policies
 Cash only
 Payment of statement in full
 Extended payment
24

Using a Credit Bureau
 Collection
 Bankruptcies
 Judgments
 Lawsuits
25

Aging Accounts
 Provisions of the Fair Debt Collection
Practices Act of 1996
 No harassment, oppressive tactics, or abusive
treatment
 No making false statements to a debtor
 No calling at work if employer or debtor objects
and requests no calls
 No calling before 9 AM or after 9 PM
 Speak only to debtor
26

Collection Letters
 The recommended sequence is:
 Reminder
 Inquiry/discussion
 Urgency letter
 Ultimatum letter
27

Telephone as a Collection Instrument
 Remember, privacy is required
 Biggest mistake: Waiting too long to follow up
28

Collection Agency
 Reputable
 Follows federal and state guidelines
 Make sure agency will not start legal action
without the dentist’s consent
 Make sure agency understands a patient’s
needs
29

Collection Agency
 Debtor’s full name
 Last known address and phone number
 Total amount of account
 Date of last entry on account (credit or debit)
 Debtor’s occupation
 Business address and phone number
 Any other pertinent information
30

Collection Agency
 Send no more statements
 Indicate the transfer to the collection agency
on the patient’s financial record, giving the
date of transfer
 Refer the patient to the agency if the person
contacts the office
 Report the amount to the agency when
payment is received in the office
 Rely on the agency staff members to do their
job
31

Questions?
32

Chapter 15- Financial Systems- Accounts Receivable

More Related Content

What's hot

Similar to Chapter 15- Financial Systems- Accounts Receivable

More from HeatherSeghi

Recently uploaded

Chapter 15- Financial Systems- Accounts Receivable