Improving Profitability: Reducing Days in AR

Ep. 113: Kristle Young – Improving Profitability: Reducing Days in AR

Here’s what to expect on this week’s episode. 🎙️

Reducing Days in AR? It starts before the claim is even filed.

In this week’s episode, Kristle Young, COO of Collective RCM, shares the key drivers behind high-performing revenue cycles for ASCs—and what to fix first if your AR is aging fast.

🔑 Key takeaways:

30% of AR across sampled ASCs is over 90 days old. Once a claim hits 90+ days, your chance of collecting drops significantly.

The biggest fix? Pre-service financial clearance. Verify insurance, check for authorizations, and give patients upfront cost estimates.

Clean claims = fast payments. Target a 98% clean claim rate and track denials to catch broken workflows.

Partial payments are up from 41% → 56%, while total payments are down from 26% → 17%. Rising deductibles, payer delays, and bundled payments are all factors.

Embrace AI to streamline claim status checks, denial analysis, and even appeal prep.

Listen to the full episode to hear how your ASC can reduce write-offs, boost collections, and make smarter use of automation.

Episode Transcript

[00:00:00] Welcome to this week in Surgery Centers. If you are in the ASC industry, then you are in the right place every week. We’ll start the episode off by sharing an interesting conversation we had with our featured guest, and then we’ll close the episode by recapping the latest news impacting surgery centers.

We’re excited to share with you what we have, so let’s get started and see what the industry’s been up to.

Hi everyone. Here’s what you can expect. On today’s episode, we are carrying on with our series on improving profitability. Last week, we explored how AI and automation can boost your ability to collect outstanding balances with Melanie Howett. This week we have Crystal Young from collective RCM on to share some tips on how you can reduce days in ar.

In our news recap, we’ll cover a few trends from the annual Ask a conference. Shoulder replacement growth, a new joint venture agreement between Cleveland Clinic and [00:01:00] Regent Surgical, and of course, end the new segment with a positive story about this year’s recipient of the Nap Gary Award. I hope everyone enjoys the episode and hears what’s going on this week in surgery centers.

Nick: Crystal, welcome to the show.

Kristle: Yes, thanks for having me.

Nick: Crystal, before we dive right in here can you give us just a little bit of an overview on collective RCM and your role with the company?

Kristle: Absolutely. Yeah, so, again, my name’s Crystal Young. I’m the Chief Operating Officer for Collective RCM. We are a full service revenue cycle management company located here in Plano, Texas.

And we’ve been in business for. I guess 15 plus years. But our staff together has about 35 plus years in RCM experience. I myself have been in healthcare for 30 plus years . We focus pretty much on hospitals, [00:02:00] ASCs laboratories. Intraoperative neuromonitoring services, physician groups, and again we do everything from A to z all the way from patient financial clearance all the way through, posting and patient financial services.

So we are definitely a full service revenue cycle management company.

Nick: Fantastic. And wanted to ask you about a couple of metrics and KPIs today as it relates to the RCM process and get your take as a, as an expert in the space. And then thought we could also touch on HST State of the industry report.

We’ve got some good data from our customers. And thought we could iwe some of those stats into the conversation as well. And so if we jump into it, if we think about the revenue cycle process days in AR is a north star metric for a lot of our customers looking to manage that down, right?

And so why is reducing days in AR so critical? [00:03:00] To the overall financial health of an A SC?

Kristle: Sure, absolutely. So, as we know, days in AR is a really a key indicator of how efficient an A SC is converting services into cash. So if you have an A SC where there are high AR days you automatically, that means delayed cash flow and that is a huge pain point for an A SC.

The more days in ar you’re gonna have more write offs. Potential liquidity issues that can impact your operations. And outpatient ASCs, they have some tight margins, right? So faster reimbursements are crucial for their cash flow because they’ve gotta be able to vet back in supplies their staff, their patient care.

So always the goal should be shorten that revenue cycle maintain compliance and accuracy and keep that cash flow coming in very quickly.

Nick: Right. And if we tie this to [00:04:00] our state of the industry report that I mentioned, we found that 30% of AR from the customers we sampled is greater than 90 days old.

And so if you think about that, greater than 90, we typically wanna avoid, what are some of the most effective strategies you found in terms of lowering those days in ar?

Kristle: Sure. Yeah. So as we just said, aging AR is a major red flag for an A SC, right? And statistically when a claim gets in that 90 day range.

Your chances of collecting on that claim can reduce down to 30%, so you obviously don’t want it to get there. So effective strategies for keeping it out of that range. One important thing is pre-service financial clearance. You wanna make sure you’re verifying your patient’s insurance, that you’re checking to see whether the patient needs an authorization for their upcoming service.

And also it’s [00:05:00] very important to have a strong patient cost estimate process in place where you are able to get that patient, their financial patient responsibility ahead of time so that patient can make an educated decision about how they’re going to pay that. Deductible or that co-insurance, you don’t want your patient coming in that morning and being hit with an unexpected large amount because there’s enough stress that the patient’s going through, right?

They’ve got surgery. So as soon as a patient gets put on the schedule, getting that cost estimate done, making that phone call to the patient and then giving them options, right? So. Offering them a payment plan with, yourself. The A SC obviously, ideally is to get it all upfront but also offering them a payment plan option or payment.

There’s companies out there that’ll finance patient responsibility as well. So that [00:06:00] is a very effective strategy. Because if you don’t get authorizations, then you’re gonna get denials, you’re gonna get your claims in those 90 plus days ar and you’re not gonna get paid another effective strategy.

It’s just being very proactive on your claims management. Try to submit clean claims first. You really want your RCM company to be at about a 98% clean claim rate, and also be very diligent in tracking your denials because your denials indicate your foundational workflow, right? If you have a lot of denials and authorizations, and you’re obviously your pre-service financial clearance protocols broken.

Nick: Right? Yeah,

Kristle: yeah. You wanna fix that foundational issue. So proactive claims management is important. Automating claim edits. Scrubbing can significantly cut down on rejections, getting those clean claims out right away before they don’t get into your older days of ar. Another [00:07:00] strategy is having patient payment optimization.

Again, offering easy digital ways for the patients to pay, setting up automated payment plans because if you don’t get that patient payment, then you’re gonna result in a lot of your claims being partially PLA paid. Right. So, and you wanna communicate clearly with your patients about their responsibilities upfront.

And again, having a dedicated follow-up team on claims. You can use automation. Where you can have your automated tools automatically go out and check on claim status to proactively look and see, hey, is it paid? Is it in the process of paid? Is it denied? Is it looking for a medical record request where you’re not waiting for that correspondence to come in the mail?

That can reduce your days in ar but having a very focused team that is structured around looking at claim status paying attention to how your payers pay. So if [00:08:00] Medicare pays within 14 days and you have a claim sitting out there at 45, you shouldn’t let it get there. Get to that point anyway, but look at your payer reimbursement timeframes and pay attention to when they normally pay their normal trends.

So you know, what to follow up on.

Nick: Fantastic. And so as you’d expect, there’s a lot in there to optimize, right? In terms of the effects days and ar, if you were to pick out maybe two or three. Right. So we have days in ar, but are there some leading indicator KPIs, whether that’s around clean claim rate, as you mentioned, or denial rate are there any leading indicators that you would look at to say these are the two or three most important that will predict an impact days in ar?

Kristle: Yeah, I think, again, I think one of the main leading factors is that pre patient financial clearance step. Because you, if you, maybe the patient gives you some [00:09:00] insurance, it’s not even active. Right. And then you and you weren’t effectively checking. ’cause every payer is different on whether they need an authorization or not.

I think that is a number one thing, making sure that pre foundational patient verification. Authorization process and providing cost estimates. ‘Cause you don’t wanna try to collect that money later and patients can take a long time to pay or not pay at all. So that’s one. And then I think the second thing is that really that claim.

Proactive follow up. That is key. Because if you can react to a claim quicker and waiting for, like I said, correspondence to come in the mail, the chances of you getting that cashflow in faster is huge. Huge.

Nick: Okay, great. Wanted to ask you about another stat and trend we found in hst state of the industry report.

And so in that report we saw that. We looked at [00:10:00] 2003 to 2004, so year over year there was an increase in partial payments from 41% to 60 56%, so 41 to 56 but a decrease in total payments. I. From 26% to 17%. And those payments combine both the payor side and the patient side. And so any thoughts on why that may be the case in terms of lower overall payments, but more partial payments?

I.

Kristle: Sure. Yeah. I think there’s several factors that could contribute to this statistic. I do think that higher patient financial responsibility is becoming an issue because insurances are just not as good as they used to be. Like I said, I’ve been in, I’ve been in healthcare for 30 plus years.

I’m like. Man, the insurances don’t cover what they used to be. So

Nick: yeah, so

Kristle: you got rising deductibles, you got rising co-insurance, rising copays. I think more patients are struggling to pay their balance. So I think that is leading to increased [00:11:00] partial payments. So again, it goes back to my importance that I stressed earlier about having that conversation, that financial transparency conversation with your patients and.

Maybe having outside patient financing options for your patients. Then the a SC doesn’t necessarily have to carry that burden, right? They may experience a small haircut off the top, but it may be worth it for them. Their profit margin may still be. Good enough where they would rather have 4,500 instead of 5,000, lose that $500 to ensure that they get that payment upfront.

So I think that is encouraging a part of a reason for partial payments. I think there’s also payer reimbursement challenges. A lot of payers are pushing back with lower allowable amounts. Again, it goes back to payers don’t wanna pay. They’re in the, they’re in it to make [00:12:00] money and you know they’re gonna push back with lower allowable amounts.

They’re gonna try to increase your denials. They’re going to ask for medical records to hopefully delay the payment, or hopefully that you don’t respond to a medical record request. And then it’s funny, with all the automation and everything that’s going on, I think we’re also seeing slower payment processing from payers.

And then I think too, there’s a shift in payment models. I think ASCs are seeing more bundled payments. So your total payment is going down because they’re saying, well, this is bundled together. That’s a factor. I think improper coding combinations can cause this to happen can decrease the overall total payment while only making a partial payment.

Also medical record documentation is key to support the code that you bill, right? So they may ask for medical records, and maybe that medical documentation doesn’t support the full payment on the claim. Maybe you billed [00:13:00] something, you did something, but you didn’t document it. So medical documentation is key.

And then also just I think economic pressures, again, this goes back to patient’s ability to pay. We’ve got inflation, we’ve got financial strain on patients and affects it that impacts their behavior on how they’re gonna pay. So again, I think strengthening upfront collections, streamlining patient financing options, and also being proactive as an RCM company.

And encouraging your client or your a SC to be very proactive with your contracts. Payer negotiations are key and also an RCM company needs to monitor contract management, right? So having a practice management software that allows you to load in the contracts. That shows the true allowables that this a c is supposed a SC is supposed to get is crucial, right?

Because you may think you [00:14:00] got, $60,000 for the claim, but maybe the insurance was supposed to pay 65,000. So you have to monitor that you’re getting paid what you’re contractually supposed to be getting paid.

Nick: Yep. So I think those are things that

Kristle: can be contributing to those statistics.

Nick: Sure. Follow up question for you. You touched on patient financing options. What have you seen to be the best options in the market?

Kristle: I really there’s a lot of different options out there. But I really think the most effective strategy for an A SC is to look at outside patient financing options.

There’s a lot of companies out there trying to get that burden off of the a SC ’cause a lot of patients want a payment plan, right? And I’ve seen in my experience, you can get a patient on a payment plan, they’ll maybe pay, they’ll be good for about three months after their surgery, and then they just drop off the planet, right?

So it’s [00:15:00] very effective to, the financial health of your A SC is to provide that patient. There’s obviously CareCredit. Experian I think offers some options. I’m drawing a blank on another one, but there are a lot of options out there that you can engage with, and it’s a very small percentage off for the A SC, but they’re getting that money up front.

Nick: Sure. Yep. Yep. Got it. Okay. So we’ve touched on several of the factors that are important to driving down days in ar. If we look at that from the vantage point of what’s the most inefficient today is there anything that you’d call out in this overall RCM process that’s inefficient for a lot of centers today?

Kristle: Yeah, so I think again, one of those things that, you know, when we come in and we’re asked to re, to engage with the new A SC, we see a lot of claims in ar, and a lot of them are just simple denials for authorization, and that is such an easy [00:16:00] fix. Right, but they don’t have a front office staff, or they don’t have an RCM team really thoroughly engaged in making sure that pre-financial patient clearance is performed accurately.

They just maybe assume that, well, United Healthcare didn’t need an authorization for a total knee. So they assume that Blue Cross doesn’t need an authorization, right? Yeah. You have to be very in tune to that. And my rule of thumb is even if you think that you haven’t had authorizations needed on a certain procedure for a certain payer, you check anyway because that patient may have a unique.

Insurance that is a little bit different and they do require that authorization. So I think one of the major inefficiencies I see is just that patient pre-ver verification, financial clearance. Inefficient charge capture and coding errors is also an issue. So if you don’t have good preference cards and your nurses aren’t [00:17:00] documenting all your supplies or your implants, if we could be missing supply charges or missing billing for an implant, then also having a good coding company coding team that’s going to make sure that everything is coded to maximize reimbursement, right. Or coded correctly so you don’t get a denial. Regular audits using ai assisted coding tools can also improve that accuracy. AI and automation is just.

A huge topic right now, right? So the most the more you can utilize AI and automated processes, the better you’re gonna be.

Nick: And where specifically, ’cause everybody’s talking about AI and where does it come into play in revenue cycle and elsewhere for an A SC, where specifically do you see the most potential for AI within the revenue cycle process?

Kristle: Well, I think analyzing denials. Is huge. Right? And being able to look and see what denials are really hitting your A SC [00:18:00] and drilling down on what those are and fixing the foundational, root cause of what’s causing them. Right. But you can use AI in a lot of different places. The automated claim status follow ups where you don’t have to, you used to be able to you’d have to have 30 collectors, right?

And they’re picking up the phone and they’re calling Blue Cross, they’re on hold for two hours. You have that automated ai. Claim status tool, right? It drastically and it spits back a report for you and you just took of, you just took care of looking at statuses on 50 claims in an hour versus, 10 people having to make phone calls.

So it’s a huge improvement in cash flow using AI tools for checking verification benefits checking to see if an authorization is needed. Automated posting of denials. The, if you get that automated posting quicker, then you can react to that denial faster and fix it, and that improves your cash flow.

Just, sending out [00:19:00] automated messages, doing an automated AI message to your patients. Hey, you have a payment plan. You’re on a payment plan, you have an upcoming payment due on May 15th. Just wanted to remind you, there’s all kinds of things. AI can also start to be used in preparing appeal letters.

If you have a certain denial, maybe for medical necessity you could have an AI tool that can also build that appeal letter, go and grab medical records, prepare that packet for your collector, and they just have to review it. Again, faster turnaround time on any appeals you might have to write.

But in addition to that, other inefficiencies again, lack of structured follow-ups. I’ve hit on that a few times here, but you’ve gotta have a strong PO process for payer follow-ups. So to lead into that, again, that AI automated claim status tool is just a game changer.

Nick: Fantastic. Crystal, one more question for you, and we do this with our guest each week. What’s one thing our listeners can do this week to improve their surgery [00:20:00] centers?

Kristle: Yeah, I think, an actionable step that an A SC could take as a project is going and audit their top 10 unpaid claims over the last 90 days.

Try to identify some common trends. Across those top 10, and I bet you’re gonna find a very core foundational issue whether it be approvals sorry, authorizations that were missed. Or is it a certain payer that’s just constantly asking for medical records? Or is it a certain payer that’s not paying on time or, just is it coding errors? Just really drill down and see why they’re not paid. ’cause I guarantee you’ll find a core foundational issue that can be addressed on the front end that can fix that problem.

Nick: Fantastic. Crystal, thanks so much for joining us today.

Kristle: Yeah, thanks for having me. I appreciate it.

Erica: As always, it has been a busy [00:21:00] week in healthcare, so let’s jump right in. As, a’s annual conference was held from April 30th to May 3rd in Colorado and brought together thousands of a SC industry leaders, I personally had such a great time at the show and a huge thank you to all of you who came to the HSC booth to chat and share positive feedback about the podcast.

Sometimes I feel like I’m just. Talking to myself out here, so to be able to talk with so many listeners was so much fun for me. Aside from that though, here are four themes and key takeaways from ASCA 2025. The first data automation and tech adoption are non-negotiable. Across the exhibit hall and breakout discussions, the message was consistent tech enabled ASCs are better positioned to succeed.

Automation is transforming workflows from streamlining revenue cycle processes and clinical documentation to improving inventory management and reducing compliance risk. Data analytics was also front and center with many leaders looking for smarter [00:22:00] ways to track KPIs or key performance indicators and spot operational inefficiencies.

So the main takeaway was clear here. Embracing the right tools isn’t just about efficiency. It’s essential for scaling your a SC, staying compliant and meeting the growing demands of patients and payers alike. The second key theme that I saw was that leadership development is super important amid staffing shortages.

So with staffing shortages still top of mind. Many conversations and sessions focus their attention on how to build resilient teams and retain high performers. Leadership development emerged as a top priority with discussions around how emotional intelligence, thoughtful delegation, and structured evaluations can create a more stable, supportive workplace culture.

There was broad recognition that a strong leader doesn’t just manage operations, right? They influence retention, morale, and the long-term health of the center. So culture, communication, and team alignment are just [00:23:00] as important as clinical outcomes when it comes to a SC success. The third theme that I noticed leading ASCs focus on maximizing profitability and long-term value.

So a key theme across the conference was the growing emphasis on strengthening financial performance and planning for long-term success. Attendees and vendors were all talking about how you can focus on strategies to improve payer reimbursement, increase revenue per case, and enhance overall profitability.

There was a strong push towards mastering financial data, so from understanding statements to analyzing cost drivers to better inform operational decisions. Related hot topics included real estate monetization, growth planning, and preparing for a potential sale. Financial literacy is clearly becoming a competitive differentiator for a SC.

Leaders aiming to scale or future proof their organization. And lastly, total joints continue to take center stage. We talked about this our in our recap last year, [00:24:00] and I’m sure we will be talking about it in our recap next year. So total joint replacements, hot topic among attendees exploring new service lines.

Many were exchanging advice on launching and scaling outpatient joint programs from building out infrastructure to navigating payer relationships and optimizing patient outcomes. The conversation emphasized that high acuity growth is possible with the right clinical, operational, and financial foundation in place.

Many sessions covered certification processes, patient selection, and staffing models to support success. With strong interest in ortho expansion, total joints were seen as a major opportunity, especially for ASCs ready to invest in long-term differentiation and value-based care readiness. Now that is really just the tip of the iceberg when it comes to what was else was covered at asca.

There were so many great sessions. The keynote speaker, Melissa Stockwell was amazing. All the parties and networking events were great. It really was a fantastic week, and once again, [00:25:00] thank you to ASCA and everyone who puts in so much time planning and running the event. It was a huge success and we’re already looking forward to DC in 2026.

All right, next story. Shoulder replacements are quickly catching up to hips and knees in the outpatient surgery world, despite being approved by CMS years later, doctors speculate that shoulders have been a bit behind because patients can live with a bum shoulder a little easier than a bad hip or knee.

That mindset is shifting and it seems to be shifting fast. Recent data showed that more total shoulder arthroplasties, so TSAs are being performed overall and even more patients are being discharged home from inpatient cases on same day basis. The 2019 American Academy of Orthopedic Surgeons Shoulder and Elbow registry shows that 71% of patients were discharged to their homes from 2015 to 2020 same day, and from 2020 to 20 23, 70 9% were [00:26:00] discharged within the same day.

Another important piece is just educating patients on how well-suited shoulder replacements are to the outpatient setting. Surgeons like Dr. David Dare, North Carolina and Dr. Corey Reed in Buffalo say the procedure is often less painful than other shoulder surgeries, especially with nerve blocks that reduce the need for post-op pain meds.

Patients go home in a sling feeling little to no pain and don’t require the intensive recovery that comes with hips or knees sometimes. The key to success, though standardized protocols, streamline trays, and clear patient education. At Excelsior Orthopedics, they’ve built a program around consistency. So the same instruments, same instructions, same equipment, making it easier for staff, and very predictable for patients.

And as Dr. Dayer put it, my patients are resting at home two hours after I make the incision. It’s a complete paradigm shift. So what does this mean for ASCs? Shoulder replacements represent a major growth opportunity with improved pain [00:27:00] management and strong patient outcomes. TSAs are a perfect fit for surgery centers and for centers, already doing rotator cuff repairs.

Adding shoulders may be less of a leap than you think, and could be the next big move in expanding your already existing orthopedic service line. All right. Third story, very exciting news for the A SC industry. Cleveland Clinic. One of the most respected names in healthcare is teaming up with Regent Surgical to expand a SC access across the us.

The partnership announced May 7th is focused on developing new ASCs and strengthening Cleveland Clinic’s outpatient care delivery. Cleveland Clinic is a nonprofit, academic medical center and research powerhouse with over 82,000 employees, nearly 6,000 physicians and researchers, and more than 280 outpatient facilities.

In 2024 alone, the system handled over 15 million outpatient visits and performed 320,000 surgeries and procedures. [00:28:00] And then Regent Surgical, who’s based in Franklin, Tennessee, manages a SC partnerships in 13 states and is no stranger to high profile collaborations Earlier this year, they also partnered with Mass General Brigham to grow a SC services in New England.

So with Cleveland Clinic as the majority owner in the new venture, all ASCs will carry the Cleveland Clinic brand. The move follows a series of innovative collaborations by the system, including a telehealth venture with Amwell and a partnership with Amazon’s one Medical. Alright, so why does this partnership matter?

It really just signals a continued shift. Major health systems aren’t just embracing ASCs, they are doubling down and fully investing. By partnering with specialized operators like Regent, they’re looking to scale quickly and can do so strategically. For a SC Leaders, this is a clear sign that the future lies in collaboration, branch strength, and meeting patients where they are efficiently, affordably, and closer to home.

And to end our new segment on a positive note at the ASCA [00:29:00] 2025 Conference in Colorado, Kathy Wilson was honored with the nap Gary Legacy Award for lifetime achievement in the A SC community. The award presented by Dr. David Shapiro recognizes individuals who exemplify integrity, leadership, and commitment to quality and safety, and ASCs and honors individuals with at least 15 years of service.

Wilson most recently served as executive director of the A SC quality Collaboration from 2021 to 2025, where she oversaw operations and advanced quality reporting efforts in partnership with federal agencies. Her work significantly shaped the Assc QCs national influence, especially in educating stakeholders about CMSs a SC Quality reporting program.

Previously, Wilson spent nearly a decade at AmSurg where she developed a quality and risk management program for over 260 surgery centers and created a comprehensive data repository. Before that, she held leadership roles at HCA Healthcare for over a [00:30:00] decade. Wilson expressed a deep gratitude for the recognition and shared the honor with fellow quality and safety professionals in the field.

Her decades long dedication to advancing outpatient surgery standards earned her the unanimous vote of ASCAs Board of Directors. Now, I have had the pleasure of working with Kathy directly and can personally attest to just how knowledgeable, brilliant, and kind she is, and this award is so well deserved.

And that officially wraps up this week’s podcast. Thank you as always for spending a few minutes of your week with us. Make sure to subscribe or leave a review on whichever platform you’re listening from. I hope you have a great day, and we’ll see you again next week.