Some Ideas to Improve Patient Collections

April 9, 2018

According to ACA International, 29% of adults have medical debt or trouble paying medical bills. From these numbers, it’s apparent that something needs to be done to improve patient collections.

Some physicians are making the often times drastic switch to nontraditional payment programs in hopes of a remedy. But there are ways to improve patient collections while avoiding dramatic changes for your practice.

Give patients more payment options

Your practice benefits when patients pay their outstanding balance. So, if a patient wants to pay using a reasonable method, there shouldn’t be any restrictions to doing so. This means allowing patients to pay by cash, check, debit/credit card and through an online payment portal.

This last option is critical as Americans move toward online bill paying because of convenience and also because today’s patient is very tech savy. Patients don’t have to travel anywhere or write anything by hand in order to pay their bills online. A 2006 New York Times article reported that 35% of Americans were paying bills online. One can only assume the number has risen dramatically since then.

Set a standard payment policy

Your practice should have a clear, standardized payment policy that patients are aware of. The reasons are two-fold: it provides backing during difficult payment discussions and gives patients a set of consequences for not paying.

When your collections staff is trying to collect payment from a patient having a standard policy reduces the patient’s wiggle room. They don’t have the option of saying “Oh, I thought I could pay it later,” if it’s clearly outlined in your policy.

And if your patients face consequences for not paying in a timely manner (the consequences are up to you), paying their medical bills becomes more important. If a patient doesn’t pay their light bill their lights go out, which makes paying the light bill a top priority. Make paying medical bills a top priority as well.

Finally, make sure your staff is accountable for implementing your payment policy. Is the front desk collecting copayments and deductibles? How is your business office collection staff doing? Make sure you have the checks and balances in place to monitor how well staff is implementing your collection policy.

Dangle a carrot for your staff

Try using an employee incentive program to boost your collection rate. An incentive program should offset its own cost by increasing the revenue each collections employee brings in.

For instance, say each collector at your practice brings in $2,000 in unpaid expenses each month on average. If you offer staff members a $100 gift card if they increase that number to $2,500, you’d bring in an extra $400 per month in revenue from motivated employees who meet the goal. If some employees don’t, there’s no harm done.

The key is in planning the program carefully. Analyze your numbers, so you can find the point at which your practice can offer a motivating incentive to employees while increasing overall revenue.

Be persistent, not annoying

There is a fine line in collections between reminding your patients that they need to pay their bills and harassing them. The FTC’s Fair Debt Collections Practices Act (FDCPA) draws the line.

You should call patients to remind them of their debts and try to work out payment, but you must call during “reasonable” hours per the FDCPA. Between 8 a.m. and 9 p.m. are considered reasonable hours. Also, calling by phone too frequently is in violation of the FDCPA, although what constitutes as too much is not defined. Violating the FDCPA can leave you open to a lawsuit.

Remind any collections staff to remain cordial in all interactions with patients. Patients are more likely to work toward payment with someone friendly, rather than with someone they find threatening.

As it’s the last step in the revenue cycle management, it’s essential to improve patient collections. It would be a shame to let all the steps leading up to collection go to waste.

Are you hungry for more information about maximizing profitability? Our Actionable Analytics whitepaper should keep you satiated.

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