December's quiet stretch is your best shot at catching billing gaps and prepping staff for Medicare changes. Here's what to tackle before January.
The last week of December has a different feel in most outpatient clinics, the waiting room empties out, the phones go quiet, that frantic energy that defines most of the year finally loosens its grip. I've spent years talking to practice managers and clinic owners, and they all describe this period the same way: it's the only time they can actually think, no fires to put out, no packed schedules demanding attention, just a rare window to step back and take stock.
That's exactly why this stretch matters so much for operational planning. A year end practice checklist isn't glamorous work. It's not the kind of thing anyone gets excited about at a conference, but done well, it functions like preventive maintenance for your revenue cycle. You wouldn't skip an annual inspection on critical equipment, your administrative and billing systems deserve the same attention.
Here's what I mean. January 1st brings a wave of changes that directly hit your bottom line: Insurance policies reset, Medicare updates kick in, Patients who switched jobs or aged into new coverage during open enrollment may not even realize their information has changed. If you catch those discrepancies now, before claims go out, you save yourself significant headaches later.
The alternative? You find out in February, when denials start piling up. And the denial data tells a sobering story. According to HFMA's 2024 benchmarking, initial claim denial rates climbed to 11.8 percent across the industry, that's up from 10.2 percent in prior years. Registration and eligibility errors account for roughly 27 percent of those denials, making them the single largest preventable category. I had to read that twice, more than a quarter of all denials come from verification problems that could be caught before a claim ever goes out.
So let's talk about how to actually run an insurance and billing audit during this window. The approach that works best involves what I call three touchpoint verification. It sounds clinical, but the concept is simple: you verify insurance at multiple points, not just when someone first schedules.
1. First touchpoint: One to three days before the appointment, confirm that policy numbers, group IDs, and patient demographics match what's in your system. Flag any secondary coverage. Note prior authorization requirements.
2. Second touchpoint: At check in, ask patients directly if anything has changed. Collect an updated insurance card if needed.
3. Third touchpoint: Direct payer contact when discrepancies appear. Document the representative's name and reference number for your records.
Why all three? Because roughly 20 percent of patients experience insurance changes annually. New employers, plan switches, policy terminations. Without proactive verification, those changes become denials. The financial stakes here are real, HFMA reports that 22 percent of healthcare organizations lose at least $500,000 annually to denials. Ten percent lose more than $2 million, yet 65 percent of denied claims are never resubmitted. That's money left on the table, recoverable revenue that just... evaporates.
But don't worry, automation helps here. Real time eligibility tools integrated with your practice management system can verify coverage in seconds rather than minutes. One health system documented $18 million in prevented denials within five months of implementing automated verification. Even if your practice operates at a fraction of that scale, the proportional benefit holds.
Your December action item: run a batch eligibility check on all patients scheduled for the first two weeks of January. Flag coverage gaps, expired policies, or missing secondary insurance. Assign someone to follow up before the new year.
Medicare policy updates also take effect January 1st, and several directly affect therapy and outpatient practices. The 2026 Physician Fee Schedule includes a modest conversion factor increase of 3.26 percent for non qualifying participants. But the more consequential changes involve therapy thresholds and telehealth.
The KX modifier threshold rises to $2,480 for combined physical therapy, occupational therapy, and speech language pathology services. Practices exceeding this threshold must document medical necessity with the modifier (that means updating your documentation templates and training billing staff accordingly).
Here's where it gets concerning. Telehealth authorization for PT, OT, and SLP services expires January 30, 2026, unless Congress extends it. If your practice relies on telehealth for therapy services, you need contingency plans for in person scheduling. Monitor legislative developments closely.
Beyond Medicare, there are HIPAA related updates requiring attention. Practices treating patients with substance use disorders face a February 16, 2026 deadline to align their Notice of Privacy Practices and consent forms with updated 42 CFR Part 2 requirements. This isn't optional, outdated forms create real compliance risk.
A proposed HIPAA Security Rule update also remains under review. If finalized as drafted, it would mandate multifactor authentication, encryption requirements, and shorter breach notification timelines. While not yet law, practices should start evaluating their cybersecurity posture, and please, consult with qualified compliance professionals for guidance specific to your situation.
Your December action item here: review intake forms, consent documents, and billing templates against 2026 requirements. Update anything referencing prior year thresholds or outdated policy language. Brief your front desk and billing teams on what's changing.
Now let's talk about your people. Workflow changes announced in December often don't get implemented until February, and by then, weeks of confusion and workarounds have already cost you money. A better approach trains staff before the new year, so updated procedures are already in place when January volumes pick back up.
The American Medical Association recommends a 30 to 60 to 90 day framework for procedure changes. Introduce the concept in week one, practice the new workflow in weeks two through four, evaluate competency by day 90. For year end updates, a compressed version works, identify the highest impact changes, train on those specifically, and schedule a follow up check in for mid January.
Cross training deserves attention too. Holiday staffing often runs lean, a single absence can bottleneck critical functions. Make sure at least two team members understand eligibility verification, prior authorization workflows, and basic claims submission. This redundancy protects revenue during the weeks when mistakes cost the most.
What about new systems? If you've implemented or upgraded software in the past quarter, December is the time to validate that everything works as expected. Test integrations between scheduling, billing, and EHR platforms. Verify that data flows correctly from intake forms to claim submission. Catch errors now, while patient volume is low and fixes can happen without immediate pressure.
I should mention that EHR implementations carry meaningful risk. Industry data suggests 20 to 25 percent of implementations underperform or fail outright. And the most common culprits are inadequate testing, rushed timelines, and insufficient staff training. None of these are technical problems, they're planning problems. Use December's quiet period to address them.
And then there's the question I find most practices avoid: do you actually know your numbers? Improvement requires measurement, yet many clinics operate without clear visibility into their core operational metrics. Before setting Q1 targets, you need to establish your current baseline:
Denial rates. The industry benchmark falls between 5 and 10 percent, best performers maintain rates below 5 percent. If you don't know your current rate, pull a report from your practice management system covering the last 90 days, segment by denial reason (eligibility, coding, authorization) to identify where intervention will have the greatest impact.
Days in accounts receivable tells you how quickly you're collecting. MGMA benchmarks suggest 35 to 45 days as typical, thirty days or fewer indicates strong performance. If your A/R stretches beyond 45 days, investigate the causes. Slow payer response? Internal follow up delays? Claim submission errors? Each requires a different fix:
No show rates directly affect revenue and scheduling efficiency. MGMA's 2023 data placed the median no show rate at 6.81 percent, roughly matching pre pandemic levels. Notably, 42 percent of medical groups now charge no show fees. If your rate exceeds 7 percent, consider whether automated reminders, confirmation calls, or fee policies might help.
Net collection rate measures how much you actually collect against what you're owed. The target is 95 to 96 percent, top performers reach 97 to 99 percent. Every percentage point matters. On $4 million in annual charges, improving from 90 to 95 percent collection represents $200,000 in additional revenue.
You can't improve what you don't track. Pull your key metrics before the year ends. Document your baselines, set specific targets for Q1, and make those targets visible to your team.
Here's the piece that brings it all together: connecting these improvements to actual dollars. Operational improvements aren't abstractions, they translate directly to revenue. One specialty pharmacy case study documented a 32 percent reduction in prior authorization denials, 40 percent faster approvals, and $3.2 million in additional annual revenue after process optimization. Your practice may operate at a different scale, but the proportional math applies.
Consider what a 2 percentage point reduction in denial rates means for your revenue, calculate what a 5 day improvement in A/R timing does for cash flow, quantify the revenue recovered if your no show rate drops by one percentage point. These aren't speculative projections, they're arithmetic you can run against your own numbers.
That calculation makes the case for investing in better verification workflows, staff training, or automation tools. When you know what a problem costs, the value of fixing it becomes concrete.
For years, I managed a mental health practice with over 80 providers and more than 20,000 patients. Now, I’m building the tool I wish I had back then, AI automation that makes intake, insurance verification, and scheduling as seamless as running a healthcare practice should be.
