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Getting Patients to Pay

Article

The toughest payers to collect from are your own patients. Don't despair, there are things you can do to get paid.

Negotiating with payers for adequate reimbursement requires good preparation and lots of focus by practice managers. The toughest payers to collect from, though, are not commercial insurers or federal programs, but your own patients. For that, you need good practice policies - and a determination to follow them.

When it comes to patients and payment for services, Reed Tinsley says the key is simple: accountability, on both the patient's part as well as practice staff.

Tinsley, an accountant and business adviser, says that careful attention to time-of-service collections is the most important aspect of getting paid by your patients because it’s your best chance of getting what you’re owed and it reduces your A/R. The goal at time of service, he says, should be at least 90 percent of the payment.

And one way to increase time-of-service collections is to accept every reasonable form of payment, especially debit and credit cards. Robert Hill, Jr., with Health Strategies and Solutions in Philadelphia, says people have grown accustomed to using “swipe and go” payment methods at grocery stores, retail shops, and gas stations. Why should yours be the last business in town that makes it harder for people to pay?

"The more money you collect upfront with patients and their families, the better your receivable cycle and the more money you’ll generate for the practice," Hill says.

Working with staff on proper communication and collection of payments "is critical and essential" as "the economics of physician practices are probably worse now than they’ve been at any time in history that we can recall," he adds.

He advises that payment needs to be an understanding between staff and patients handled professionally and with documented policies.

"[Patients need to know] when you come here, we want to provide the best service possible, but there are fees for those services," Hill says. "And it should be an expectation and part of the professional business culture as it is critical to the success of the practice."

Over the past year, the physician services division for Vanguard Health Systems has seen a greater number of self-pay patients, according to its chief financial officer of physician services, Louis D. Papoff. Vanguard has separate LLCs for its four employed physician groups as part of its ownership of four Illinois hospitals.

Papoff says that once the shift to self-pay patients became clear, Vanguard began focusing not just on time-of-service copays, but also on collecting past due balances and old A/R, implementing a system in all its offices that alerts front desk staff to any outstanding balances. This awareness by staff to be more attuned and more sensitive to financial considerations has led to clearer communications with patients and discussion of options, including setting up a payment plan to address any outstanding balances.

The result, he says, has been "a remarkable improvement, which has gone a long way to offsetting some of the difficulties with the payer mix shift and the increase in self pay."

The collections conundrum

With a 41 percent reduction in bad debt, Papoff credits staff for focusing on issues beyond the copay - reducing the cost of sending statements with follow-up letters to patients and the need to hire collection agencies, who take a portion of the outstanding A/R.

"While collections [agencies] are perfectly appropriate for the industry … it is really not a patient satisfier to send someone to collections," Papoff says. "Those patients would like to settle their bill, if done in an appropriate fashion."

To achieve the same results in your practice requires training of staff and possible tweaks to your billing system, but Papoff says having a firm grasp on what is owed to your practice is just as important as knowing your patient mix.

Tinsley says some practices consider sending patient statements a "routine part of their business," but it shouldn't be. A patient should get a 30-day notice to pay, then a 10-day letter, advising them of a window for them to reach the practice to discuss the outstanding debt. Only if there is still no contact should the patients be sent to collections, he advises.

"Anybody who doesn't give a courtesy phone call is not going to pay in a timely manner, so send those people to collections and be done with it," Tinsley says.

Communication is key, Deron Schriver adds, but so is having a good financial policy in place. At The Women's Healthcare Group, where Schriver serves as executive administrator, anytime they have to send more than two statements to a patient, it carries an additional $10 fee, which Schriver says usually spurs prompt payment.

Working with payers for greater reimbursement, taking advantage of possible incentives from the federal government, and streamlining your patient payment process are all key elements in getting paid for the work you do every day. But you should not pick and choose which one you should focus on as they are all important to keeping your practice financially healthy.

"People need to focus on the different pieces of the revenue cycle," advises Papoff. "They are all important and perhaps the best way to break things down is to do so in the tiniest pieces and make sure each of those pieces is being done correctly."

Editor's note: Find out what your peers are getting paid. Read our "2010 Fee Schedule Survey."

Keith L. Martin is associate editor at Physicians Practice. He can be reached at keith.martin@ubm.com.

This article originally appeared in the January 2011 issue of Physicians Practice.
 

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