Technology now allows practices to offer prepayment services to patients. Here’s how it can help your practice’s bottom line.
In many parts of the country, the economy is still in recovery while healthcare costs are continuing to rise. The end result for physician practices? More stress when it comes to getting patients to pay in a timely manner, and less-than-ideal collection rates.
Technology now allows practices to offer prepayment services to patients. But can such technology really help a practice collect payments at (or even before) the time of service? And will patients actually take to the idea of paying earlier rather than later?
For Holly Springs Pediatrics in Holly Springs, N.C., the answer to both these questions is yes. But there has to be a good incentive in place.
“It’s very hard getting money from people up front,” practice billing manager Judy Downing told Physicians Practice. “With the economy the way it is, we have so many people out of work. And they don’t look at a doctor’s office as an actual business. They look at it as ‘oh, let me bring you my chicken, and we’ll trade this chicken for your healthcare.’”
Tapping into its eligibility verification technology from its billing vendor, InstaMed, which is integrated with its Office Practicum practice management software, Holly Springs Pediatrics recently started offering “prompt-pay” benefits for patients who pay their bills early. Charges are based on the estimated cost of the medical services.
“We give them three different options,” said Downing, noting that these options are presented in a self-pay agreement form. “They can pay the estimated charges and receive a 30 percent discount if they pay the balance in full. Or they can pay 50 percent of their estimated charges and if they pay within 30 days, they get a 20 percent discount. They can pay a minimum payment and make an arrangement with the billing department.”
By offering these three options, practice has improved collections, and is seen as more flexible by patients. It has also reduced patient no-shows.
“We have had a lot of success with people paying it because they get that discount,” said Downing.
Aspen Valley Hospital, which uses the same InstaMed program, has also seen a 124 percent increase in collections over the last four years since it started offering a 20 percent adjusted discount off the patient’s portion of the bill for paying in full at the time of service. Along with their two satellite hospital facilities, the hospital initially offered a 5 percent discount but found the 20 percent discount to be more successful.
Additionally, the practice reduced overall patient collection costs by 65 percent.
“We start by telling a patient when we schedule, then the financial counselor will call and go over the expectation and say, ‘by the way, we offer 20 percent [adjustment] if you take care of your payment in full,” Debby Essex, the hospital’s director of admissions, told Physicians Practice. “Also, there’s a call before the patient comes to the front desk, and when they come to the front desk. They’re fully informed.”