CMOM FINANCIAL TERMS
Accounts Payable - ANSWER Also referred to as AP - Accounts Payable are
the bills the practice owes to vendors.
Accounts Receivables - ANSWER Also referred to as AR - accounts
receivable are the amounts owed to you by your patients and insurance carriers.
Accounts Receivable Aging - ANSWER Periodic report showing all
outstanding receivable balances broken down by patient/insurance company
from time originally posted. Normally viewed as current, over 30,60,90,and 120
days
Accrual-Based Accounting - ANSWER with the accrual method, you record
income when the service occurs, not necessarily when you receive payment.
You record an expense when you receive goods or services, even though you
may not pay for them until later.
Adjusted Charges - ANSWER Total charges minus write - offs and
adjustments
Assets - ANSWER Things of value held by the practice. Assets are balance
sheet accounts. Examples of assets are accounts receivable, furniture, fixtures
and bank accounts.
Average Billing per Patient - ANSWER total billing per month divided by
total number of patient visits by month. This can also be done for specific
diagnoses treated, new or established patients or even specific CPT codes. Total
, billing per month /total number of patient visits per month + average billing per
patient
Average Cost per Patient ANSWER The total expenses in the given period
usually per month by total patients visited for service during this time it may be
given in months, diagnosis-specific treated and so on and specific CPT and
supplies as well Total Expenses/ total patient = Average Cost per patient
Average Net Charges per Patient - ANSWER Total net collection per month
/Total number of patients by month. Can also be calculated for specific
diagnosis treated, new or established patients, or other specific CPT codes
Total net collections per month/ Total number of patient per month = Average
net charges per patient
Average Collection Period - ANSWER Also called Average Days in A/R. The
average time period for which receivables are outstanding. Equal to accounts
receivables divided by average daily charges; also called collection ratio or
collection period. AR $250,000/average daily charges$ 9,000 = Average of 28
days in receivable. Outstanding accounts receivable/average daily charges
=Average Collection Period
Average months in A/R - ANSWER (Total A/R for the past month) / (average
monthly billing for the past 12 months) Total AR $225,000/$75,000= 3.33
months in AR.
Balance Sheet - ANSWER A snapshot of the practice at one point in time. The
components typically include assets, liabilities, and the difference between,
which is the equity or net worth of the practice.
Accounts Payable - ANSWER Also referred to as AP - Accounts Payable are
the bills the practice owes to vendors.
Accounts Receivables - ANSWER Also referred to as AR - accounts
receivable are the amounts owed to you by your patients and insurance carriers.
Accounts Receivable Aging - ANSWER Periodic report showing all
outstanding receivable balances broken down by patient/insurance company
from time originally posted. Normally viewed as current, over 30,60,90,and 120
days
Accrual-Based Accounting - ANSWER with the accrual method, you record
income when the service occurs, not necessarily when you receive payment.
You record an expense when you receive goods or services, even though you
may not pay for them until later.
Adjusted Charges - ANSWER Total charges minus write - offs and
adjustments
Assets - ANSWER Things of value held by the practice. Assets are balance
sheet accounts. Examples of assets are accounts receivable, furniture, fixtures
and bank accounts.
Average Billing per Patient - ANSWER total billing per month divided by
total number of patient visits by month. This can also be done for specific
diagnoses treated, new or established patients or even specific CPT codes. Total
, billing per month /total number of patient visits per month + average billing per
patient
Average Cost per Patient ANSWER The total expenses in the given period
usually per month by total patients visited for service during this time it may be
given in months, diagnosis-specific treated and so on and specific CPT and
supplies as well Total Expenses/ total patient = Average Cost per patient
Average Net Charges per Patient - ANSWER Total net collection per month
/Total number of patients by month. Can also be calculated for specific
diagnosis treated, new or established patients, or other specific CPT codes
Total net collections per month/ Total number of patient per month = Average
net charges per patient
Average Collection Period - ANSWER Also called Average Days in A/R. The
average time period for which receivables are outstanding. Equal to accounts
receivables divided by average daily charges; also called collection ratio or
collection period. AR $250,000/average daily charges$ 9,000 = Average of 28
days in receivable. Outstanding accounts receivable/average daily charges
=Average Collection Period
Average months in A/R - ANSWER (Total A/R for the past month) / (average
monthly billing for the past 12 months) Total AR $225,000/$75,000= 3.33
months in AR.
Balance Sheet - ANSWER A snapshot of the practice at one point in time. The
components typically include assets, liabilities, and the difference between,
which is the equity or net worth of the practice.
