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Ericka L. Adler, JD, LLM has practiced in the area of regulatory and transactional healthcare law for more than 20 years. She represents physicians and other healthcare providers across the country in their day-to-day legal needs, including contract negotiations, sale transactions, and complex joint ventures. She also works with providers on a wide variety of compliance issues such as Stark Law, Anti-Kickback Statute, and HIPAA. Ericka has been writing for Physicians Practice since 2011.
Here are some very basic strategies that may help medical practices to do a better job of collecting payments from patients.
I recently attended a seminar to listen to advice from a collection company that exclusively handles collections for physician practices. Putting issues with payers and health exchanges aside for the moment, the presenter proposed some very basic steps that may help practices to do a better job collecting. I know this is advice many of my practice clients can use, as most fail to effectively implement one or more of the following:
1. For new or infrequent patients, ask them to complete a package of materials before their appointment. Access can be provided online before the patient’s visit or the materials can be sent by mail or e-mail for the patient to complete before the visit. The approach taken depends on the practice’s technological capabilities and permission provided by the patient. Successful collection activities require complete and accurate patient information, which includes:
• The patient’s full name and middle initial
• The patient's address
• The patient's social security number
• Telephone numbers for the patient and spouse
• Employment information for the patient and spouse
• The patient's insurance information (including copies of insurance card and driver’s license)
• The patient's e-mail address with a permission box allowing the practice/agent to use it
• Information on the nearest friend or relative not living with the patient, and
• The patient's date of birth
Although I never really gave it much thought, this data is the most helpful in allowing patients to be tracked down, even if they have moved. As a patient, I tend to refuse to offer my social security information (or any information on friends or relatives), so practices might find some objections in collecting this information.
2. As discussed in previous blogs, a practice must be upfront about getting paid for its services! It should be made clear to patients immediately that they are expected to cover copays and known deductibles at time of service. Patients unwilling or unable to pay should be rescheduled; provided, in the event of an emergency I would recommend the patient be seen. Having clear policies that are shared with patients can help a practice collect more fees upfront. Accepting credit cards can also make payment of fees more convenient for patients who prefer this option.
3. According to data presented at the seminar, 75 percent of medical offices don’t even try to call a patient that is delinquent in paying, even though calling patients is considered the most effective technique to recover debts. To become more comfortable in reaching out by telephone to patients, practices should develop a script, which might include the following:
• Identify the patient, and the caller
• Request payment in full. If not possible, ask if a payment plan might work.
• Make sure you understand and document what the patient says.
• Once you reach an agreement, make sure the patient understands that if he doesn't honor his commitment or follow the payment plan, he may be sent to collections without notice.
• Update your files. Anything learned in the conversation may be helpful if you need to make future calls. Make sure any payment plan that has been agreed to is properly documented and put into a tracking system.
• At all times be calm, respectful, and polite.
4. Don’t wait too long to try to collect! In the first year, the probability of a practice collecting a past due account drops by 10 percent every 30 days. This means that the longer a practice waits, the less likely it is to collect. Make sure you have an effective policy that combines letters and calls to patients and then send the bill to collection as soon as you complete the process. Make sure you work with an agency that lets you approve whether you want a patient to be sued and always use an agency that is licensed and has a reputation for acting lawfully and professionally. Don’t forget that a signed Business Associate Agreement is needed with any agency you choose.
There is no perfect way to collect patient payments, but every practice should have an effective policy, and it should tweak that policy until it gets the best results. I think most practices will agree that leaving money on the table is simply not an option anymore!