Encouraging people to part with their money is an ancient and prestigious profession that takes many forms and titles. Sales people, merchants, bankers, money lenders, cult leaders, etc.—the list is practically endless—have been around since the dawn of civilization.
It’s only been in recent years that businesses have had to establish new ways of thinking about payments, with payment cards overtaking cash sales and other forms of currency being introduced (e.g., digital currencies like Bitcoin). The bad debt collection process is practically a science these days, with special forms of technology designed around it.
For healthcare practices, the process of strategically managing funds and collecting on payments has been steadily evolving as well, and, with recent changes in healthcare legislation, advances in technology, and the transition of healthcare into a consumer-focused market, making sure that your practice’s payment collection process is both efficient and effective is more vital than ever.
According to a 2013 TransUnion Healthcare survey, patients with a positive billing experience rate their quality of care with a healthcare provider as higher overall than a patient with a negative billing experience would indicate. Practices need to understand that for many consumers, the billing process can be just as important as the actual care received.
For the financial health of your practice, an effective billing and payment process can also prevent bad debt from becoming excessive. While some bad debt is to be expected, creating an internal collection process or insisting on up front copays can help to whittle down your overall “in the red” totals—something many practices and hospitals desperately need. According to a report published by E&Y in 2014, roughly 38 percent of all debt being managed by third-party collection agencies was healthcare-related. In 2012, hospitals in the U.S. were left unpaid for $45.9 billion in services.
With those kinds of numbers, there’s obviously a problem somewhere.
Below are some potential barriers that your practice might encounter in the payment collection process, as well as some tips for setting up or adjusting your practice’s process in order to keep patients satisfied and bills paid.
Up front communication about payment expectation is vital as an opening policy for any payment/collection process. Once you’ve evaluated insurance, make sure they realize the copay they can expect, then you should also warn that additional charges could be required if any services are not covered by insurance. Your front desk should be aware of services that may or may not be covered. If they’re not, have them do the research. It’s quick work to make a phone call and get accurate information, and that little bit of extra effort can make a patient’s experience much more positive because the more sure information you can provide, the more faith the customer will have in your practice’s abilities to offer quality care.
Urgency, or a lack thereof.
Remember: the sooner, the better. Getting things done up front is essential. For instance, having insurance information that your staff can evaluate before the patient arrives is essential. Either through online paperwork submission or through phone conversation, you should have insurance information up front so that you can better evaluate costs, inform patients, and make arrangements when the patient shows for his/her appointment. Take the copays up front where-ever possible. If a service will not be covered, make sure you inform the patient before he/she arrives and inform the patient of the out-of-pocket costs. There’s no sense in wasting anyone’s time if the cost will be too high for the patient to cover. In cases where accounts are beginning to age past 30 days, be persistent in trying to collect those funds. The longer it ages, the less likely you will be to get those funds at all.
The right technology.
The right software and hardware can be your best friend with payment and collections—while a lack can be your greatest downfall. A good internal software can help you to manage and monitor outstanding payments and an online payment system, through your website, can allow you to give patients plenty of options to cover any outstanding or additional costs. Good payment and collections management can be made 100 times easier with the right tools at your disposal.
If a cost or service can’t be covered by insurance, especially for regular or long-time payments, be open to offering them options. Your patients depend on you to be able to help them and they rely on your practice to care about their needs. Providing options, such as payment plans and a variety of ways to make those payments (cash, check, money order, debit/credit card, online), will show that your practice does genuinely want to help patients.
Staying on top of it.
Most important with your payment process, don’t let it get away from you. Make sure that your staff is constantly monitoring new and old accounts for future costs and outstanding payments. For billing and coding, make sure your staff is regularly checking for any returned billing requests or coding issues and that they’re resubmitting quickly. The longer these issues go unmanaged, the more likely they are to pile up and never be addressed at all.
An efficient payment process is essential for any business, but the medical field has to deal with insurance, copays, and unexpected situations that few other businesses have to address. Even so, it is possible for your practice to plan for possible issues, then respond and communicate effectively. Setting certain procedures in place that anticipate and prevent problems with the concerns listed above will help prevent losses in the long run.