In a medical practice, what does accounts receivable refer to?

Accounts receivable in a medical practice refers to the amount of money that the practice is owed for services rendered to patients but has not yet been paid. This includes outstanding invoices that need to be collected from patients, insurance companies, or other payers.

Payments made by patients, while they are indeed a part of the overall financial transactions in a medical practice, do not capture the essence of what accounts receivable signifies. Accounts receivable encompasses the total that is pending collection; thus, it specifically includes bills that have been generated for charges incurred by patients but are not yet paid, emphasizing the practice's right to receive those payments in the future.

Expenses, on the other hand, relate to the costs incurred in running the practice, while funds received for services rendered pertain to money that has already been collected rather than what is still owed. Therefore, accounts receivable correctly identifies the outstanding amounts that the practice expects to collect in the future from provided services.