Get What's Owed Your Medical Practice

March 26, 2013

Here is step-by-step guidance to getting paid what is owed your medical practice, starting with strong policies and staff training.

Every medical office has two major goals they must meet in order to be considered successful: taking good care of patients and making enough money to stay in business. Most providers I know personally have patient care as their top priority, which is admirable. However, without proper attention to the finances, the provider will soon be out of business. In truly successful practices there is a healthy balance of attention to both patient care and finances.

The financial health of the practice involves two basic aspects: what is collected and what is spent. As someone who has worked in every medical office position from reception to billing manager, I have a unique perspective of the "what is collected" aspect. I like to call it "The Collection Cycle." Most would consider the start of the collection process when the patient is at the check-out window, but the collection cycle actually begins before the appointment is even made.

The Collection Cycle begins with policies. Put into writing the collection rules and expectations for your practice. Some questions to answer with this policy are:

• When will we collect the patient’s copay/deductible/co-insurance?

• Will we do monthly billing?

• Will we charge interest on unpaid balances?

• Will we utilize a collection agency?

• What will we charge self pay patients?

Once the policy is written, train your staff. Make sure each office employee knows what is expected and what to do when expectations are not met. One important point to make is that financial matters should be handled by the staff trained to handle them, not the clinical staff. You wouldn’t want the file clerk in the exam room giving injections, and you shouldn’t have nurses discussing finances with the patient either.

The next step in the cycle is the appointment. Gather all pertinent information including reason for the visit and insurance information. Schedulers should have at least a basic understanding of what is and is not covered by insurance. For example, you would want a scheduler to know that liposuction would not be scheduled under insurance.

Confirmation is the next step in the cycle. The appointment should be confirmed a day or two beforehand so that you can fill any cancellations and avoid having unpaid time on your schedule. Also, insurance benefits should be confirmed before the appointment. This allows you to know exactly what to collect and avoids the situation of filing a claim and later finding out the policy was terminated. We assume that patients know their benefits, but it is my experience that the majority do not. In the past two years, many insurance plans in our area have transitioned to high deductible policies. Patients have not yet grown accustomed to the change from office visit copays of $25 or $30 to all visits being subject to a deductible. This is why you have to confirm their benefits. Clearly communicate to the patient, especially a new patient, what is expected of them at that appointment. For example, if you are going to ask them for their copay at the appointment or if their insurance is out of network, tell them when you are confirming the appointment. Ugly confrontations at check out can be avoided by proper communication.

The front desk is the next step. This is where you verify you have everything necessary to see that patient. For example, you would make sure their insurance was on file and benefits verified. Even the most diligent processes sometimes fail allowing a patient to arrive for their appointment with insurance of which you were not aware. This is the last stop before services are rendered and your last chance to make sure you have the green light.

The check-out window is typically where money is actually collected. Two questions must be asked and answered at check out:

1. Does the patient need another appointment?

2. What does the patient owe, including today’s visit and any previous balance?

No matter what other duties a check-out employee has, answering these two questions is their paramount responsibility. The amount due should be clearly stated to the patient. I highly recommend that it is not stated to the patient like this, "Do you want to pay this today?" When given the choice of paying now or later, the majority of patients will choose to pay later. Having to send them a bill only adds to offices expenses.

The billing office is the last step in the collection cycle. This is where the insurance is billed and collected, or more accurately, billed, fought over, and then finally collected. I highly recommend that billing employees are thoroughly familiar with insurance contracts so that they can catch payment errors quickly. Do not back down from fighting for what is rightfully due. If there is a patient amount remaining due, the billing office should be both sending statements to the patient and alerting the front desk so that the unpaid balance can be collected at their next appointment. Thus the cycle continues.