Patient Collections Boot Camp Part 2 (SlideShare)
Why do you need this boot camp? "The psychology of setting goals is the same," says Aimee Heckman, RCM and medical practice management consultant with 25 years of experience, "whether you're losing weight, trying to get into shape or trying to get your patient collections into shape." People join boot camps to get motivated, learn good practices and have accountability as they make progress toward their goals. The Patient Collections Boot Camp was designed to provide you just that--industry best practices for goal-setting, a paced-out action plan and a whole-office dynamic to revitalize and boost your patient collections.
Finishing off this two-part webinar series, Aimee outlines and models a collections process;that starts long before your patients walk in the door and continues through the follow-up visit. High-performing practices consider every communication touch point with patients as an opportunity to inform them about their financial responsibility and to collect. Aimee shows you how to make this happen in the Patient Collections Boot Camp: Part 2 -- Optimizing Collections Before, During and After the Visit.
A big thank you to our super engaged webinar participants who brought up key questions related to the points Aimee covered. Here's a sample of the questions along with Aimee's responses:
1. For no-show fees is there a state/federal Law of what range we can charge? Are we allowed to charge new patients this fee as well?
There are no real state or federal restrictions on no-show fees, in general; however, there is some question as to whether you can charge Medicaid patients a no-show fee. While it may be permissible to charge a fee to Medicaid patients, the ability to collect it may be limited. For your practice, decide on something standard and include this in your financial policy. Be sure that everyone knows about it, and tell new patients upfront. The challenge for new patients is that you can try and send them a bill, but if they never show up or return, it will be difficult to collect. Your practice needs to determine the value of a no-show appointment, it can range anywhere from $25 to full cost of anticipated service. A proven approach is to have a tiered model. For example, for a first offence, waive the no-show fee. Then charge a nominal fee for the second, and continue to increase thereafter until you decide whether to terminate repeat offenders from your practice.
2. Are patients open to having transparent communication about their payment?
Patients want to know what they will be charged. They should have an idea of what it will cost them to see a doctor. One thing that causes confusion is that many practice fee schedules are set at 2x, 3x, or 4x the Medicare allowable. Patients think the visit cost hundreds of dollars because that is what they see on the bill and it worries them, but we know that we will only get a fraction of that amount. If patients are informed how much or how little you as a provider actually get paid for a visit, they would appreciate it and trust your office more. We should not be ashamed or embarrassed to tell a patient how much a visit is going to cost. It will help the relationship if patients know exactly what is expected of them and what they can expect from their doctor.
3. What fees do we experience with using credit cards on file?
Typically, there is a nominal percentage-based fee, similar to standard credit card transactions. If having a credit card on file process in place increases the chances of getting paid by 50%, you more than pay for the nominal fee alone. Statistically, collecting a patient balance after they leave decreases chances by 40%-50%. The time savings and increased collections is well worth the charge.
4. Can you advise if it is “legal” to add a collections fee to a patient's account that will be forwarded to a collection company, if we provide prior notification to the patient in the office Financial Policy.
We advise you to contact your healthcare attorney about adding these types of fees. However, as a general rule always disclose the fees and abide by the Fair Debt Collections Practices Act. Anybody who collects money from a patient and extends the payment more than 2-3 months needs to be familiar with the both the Fair Debt Collections Practices Act and the Truth in Lending Act. So yes, typically fees can be passed on to the patient, but they must be disclosed ahead of time and terms and conditions need to be included in your Financial Policy. This also goes for any interest you may add to their past due balance. It is not recommended to add interest because it can become more cumbersome for you and subject you to rules of the Truth in Lending Act. Always include any additional fees a patient may come across in your Financial Policy and have your healthcare attorney review it.
5. When our billing manager calls the patients, and says that they owe money in advance (on their deductible, etc.) they end up cancelling or being a no show. Anyway to avoid this? We can almost tell who's going to no show, by how much their balance is because we told them in advance?
In reality, you are better finding out in advance that a patient is unlikely to pay their bills than to find out after you have seen them several times and now you’re not able to collect. The best way to avoid this scenario moving forward is to establish a policy and expectations from the first visit. This includes collecting payment at the time of service for all copays and implementing a credit card on file policy that is consistently enforced. It also may be worth reviewing the script your billing manager uses to call the patients. For instance, see if changing it to include the offer of a payment plan would make it easier for patients to pay and reduce cancellation/no-shows. People often feel they are expected to pay in full and that no other options are available.
6. We continually have issues on declined credit cards given. Do you have any advice on how to diminish this issue?
The solution to this problem depends on the reason for decline, and unfortunately, the reason is not always clear. If the card declines while the patient is present you can ask for another card. When a card declines as part of a stored transaction, such as a credit card on file system, the best solution is to immediately contact the card holder to ask for an updated card.
With the increase in fraud and identity theft, people often report a card as lost or stolen and are issued a new card. Best practice is to have a system in place to identify declined cards and contact the patient immediately. Review your software features that allow you to put an alert in patient records about declined cards. Set the expectation of who should follow up with the patient.
7. When setting up a fee schedule, I always was told to use the formula 125% x Medicare allowable--is that too low? It seems to have worked for me and is in line with my reimbursements?
That is exactly what I recommend. Many practices that I have worked with use 200% to as much as 400% and all this does is inflate your receivables. Keep an eye on your reimbursements for instances that you receive 100% reimbursement of your fee schedule in the rare chance that a payer pays more than 125% of Medicare, but other than that, I recommend sticking with 125% of Medicare as a standard fee schedule.
8. We are debating on implementing a prompt pay policy and are struggling to find any clear legal guidance. Do you provide prompt pay discounts to everyone that owes the practice money? If not, who do you offer it to? If you offer it to patients that have insurance you are contracted with, how is that compliant with your contract agreement stating you will bill patients what is adjudicated? Do you advertise the discount? Do you print the note on the statement somewhere?
It is always a good idea to ask a healthcare attorney to review your contracts and assist in developing any kind of prompt pay discount. One thing that is key with any kind of policy is that you are consistent and that it is spelled out clearly in your financial policy which is provided to all patients. Typically, a prompt payment discount is only applied to services not covered by an insurance policy (which are already discounted to the contractual allowance). Prompt payment discounts are typically applied to self-pay services. Advertising discounts is usually not a good idea because it can be seen as a violation of Stark Laws which prohibit enticing patients into a practice through financial incentives.
9. What is the best per-visit amount to authorize with a credit card on file?
Typically, you will want authorization for at least the amount of your average new patient visit reimbursement and your average established patient visit. This will vary depending on specialty. The most common amount I have seen for primary care practices is up to $200.00. For specialty practices that include testing or other services in a typical visit, the amount may be closer to $500.00. It’s always a good idea to provide the patient an estimate of their total potential responsibility and base the maximum amount to be charged on that estimate.
10. If I have a patient checking in who has met their deductible but forgot their copay payment (despite the reminder), should I continue to service the patient? I would rather send them a bill for the copay than turn them away. Does this seem reasonable or does it help the patient develop bad habits?
Making an accommodation like this one time may be acceptable, but if it happens more than once, it is likely to develop a bad habit. A patient’s past history of payment responsibility will play a big part in any decision to allow a copay to be paid later. As an option, rather than sending them a bill, make it clear to the patient that they will need to provide a credit card over the phone within 24 hours. If they are unwilling to commit to that, it is likely that they didn’t “forget” to bring payment for their copay.
Did Your Miss Part 1?
Be sure to watch Patient Collections Boot Camp: Part 1 -- Preparing Your Technology, Staff and Financial Policy. You don't want to miss out on how to build a strong foundation to enable more effective and streamlined patient collections in your office.