Less Bad Debt: 9 Steps You Can Take to Send Fewer Patient Accounts to Collections

Some clients and patients will never pay, and that’s just part of doing business. Of course, that costs your company money, and ultimately, the consumer. However, there are some steps your AR team can take to increase cash flow and reduce patient collections. Our team of collection experts compiled this list of ways to improve your collection program. 

General Processes

1. Make sure your patient contract includes wording that enables you to recoup the fee associated with collection service. This can also later be used on statements to stress the importance of an account not going into a delinquent status. For example, a bill might say, “Per your signed Patient Agreement, a collection fee will be added to this account, and you will be responsible for the fee in addition to the provider charges.” 
2. Implement a form that ensures you have each person’s email address and cell phone number and that they sign something indicating you may contact them using those channels. This will keep costs down on future collection efforts and provides legal consent to communicate with patients regarding their bill. 

Before the Appointment
3. Collection begins before the patient arrives at your door. Speak with the patient before their visit about their insurance, deductible, and their estimated cost. Explain your payment plans or expectations of payment so they arrive at the appointment ready to pay. According to studies, patients prefer this: 62% of patients said knowing their out-of-pocket expenses in advance of service impacts the likelihood of pursuing care.

• If you are using text messaging or emails to send appointment reminders, also remind patients that “payment is due at the time of service.” 

4. One team member can review the AR of patients coming in the next day so you are prepared with the following data about each person: 

1. 1. • Amount of patient responsibility from prior visits
      • Amount due by the patient for today’s visit
      • Age of this AR 
      • Insurance results (be prepared to go over balance billed, insurance payments and discounts taken, per EOB) 

The Day of the Appointment

5. Your patient should be prepared to pay something based on the information you sent or communicated up to this point. This will reduce confusion and eliminate stall tactics. However, make sure your office has multiple payment options available. The more options, the higher the chance of success in obtaining some payment. Offer the option to use all credit cards as well as HSA payments, checks, ACHs, cash, PayPal, Apple Pay, and an online payment portal. 

6. Offer payment plans. Not everyone can pay a doctor or hospital bill in full, especially for more expensive procedures. Set up reasonable payment plans, but of course, you’ll need to make them acceptable to your practice’s operations budget. Caution: Many laws govern the extension of consumer credit. If your practice is interested in setting up long-term payment plans, make sure you contact an attorney to ensure your credit practices meet all applicable regulatory requirements.

7. Offer a prompt pay discount to encourage early payment. We suggest 20% off if they pay all prior AR on the current date of service. 

8. Set up secure storage of credit card information so you can set people up on auto-pay for their payment plans. 

9. Prepare for handling the non-pay patients. Create a script or cheat sheet for your front desk staff and discuss with them how to work with people who cannot pay. Here are some examples:

1. 1. • “I cannot pay today.” Express empathy and willingness to work with the patient for a plan to obtain payment. Make statements like “We want to keep your account in good standing to ensure there are no issues with future appointments. Let’s set you up on a payment plan that will resolve this balance ASAP.”  
      • “I’ve never had to pay up front before or Can you please bill my insurance first and then bill me?” This is usually remedied by letting the patients know, “With technology, insurance companies are now able to give patient responsibility up front and in order to keep costs down, we have changed our policy to request payment up front.” 
      • “Refusal to pay.”  This is typically given when someone is disputing a balance. Listen to their concerns, confirm or negate their stance calmly and then inform them,“If it’s not a valid dispute and they still continue to refuse payment, our provider will discontinue providing services and escalate collection efforts.”
      • “Do you offer Financial Hardship?” Have a policy in place to provide financial assistance for those that really do need it. Keep in mind: patients may ask but not qualify so you must create your requirements in advance and strictly adhere to your policy. 

The most important thing to remember in these situations is your attitude. Maintain eye contact and confidence. Your office has provided a valuable service to the patient, and payment should be expected. Also, use more “matter of fact” statements vs. open ended.- i.e., “How would you like to resolve this balance today?” instead of “Did you want to make a payment today?”

Implementing processes such as these will significantly increase cash flow. Sometimes, you still need help with policies or help collecting payment. In that case, partner with an Extended Business Office or Collection Agency to minimize the costs of implementation above. That way, your staff can spend less time collecting on old AR and more time providing quality patient care. Contact us to get your office started today.