Charging a late fee has a potential hidden benefit, too. It forces staff to get busy on patient billing and follow up. Busy staff might figure they’ll get to patient accounts later on — and never really get to them. But if patients start getting bills with late fees attached when they’ve never seen other statements or gotten a phone call, you’ll hear about it. Staff have an additional spur to get accurate bills out on schedule.

Another possibility is to charge patients for any fees related to sending their account to collections, including a 30 to 35 percent charge and any legal fees, Hausfeld suggests.

“For us, it’s a leverage point. We’ll say to a patient, ‘You owe $1,000. With a collection fee it’s $1,350. If you pay today, we can settle it at $1,000.’”

Of course, you’ll want to document late fees or collection fees in the financial policies patients get when they join your practice. Make sure to remind them, as well, during the collection process.

And keeping your eye on the ball is key.

Track results

“The most important issue of all is looking at what your motivation is for doing this,” Capko insists. “Is it valid?”

Don’t assess any sort of fee as a money-making scheme or to punish patients.

“Anytime you can avoid being punitive you are better off in any relationship,” suggests Capko.

Rather, your goal is to hold patients accountable.

Measure, then, whether collections actually are faster. Monitor whether your fees are alienating patients or referral sources. Assess whether the process of following up on fees is costing more than you are collecting.

If you focus on what you are taking in through late fees, you’ll be less focused on collecting fast in the first place. Again, your target is improving collections, not making money off of late fees. That’s penny-wise, pound-foolish.

Don’t get mad. Get paid.

Pamela Moore is a senior editor with Physicians Practice. She can be reached at pmoore@physicianspractice.com.

This article originally appeared in the April 2008 issue of Physicians Practice.