Getting Patients to Pay
Patients depend on physicians and assume they're empathetic. But when it comes to paying for services, a few patients expect that empathy to include letting your fee go if they ignore the bill.
The reasons for non-payment vary: Some people think they were overcharged and believe that because you're a doctor, you won't miss the money. Others are confused about insurance reimbursement or want to wait until the insurer pays so they know how much they really owe. A few may be struggling financially, especially after an illness.
While most businesses can resort to aggressive collection actions when customers refuse or delay payment, the American Medical Association (AMA) expects physicians to exercise greater diplomacy. In the meantime, keeping your practice financially healthy requires keeping patient accounts current. So what can you do? Before accounts receivable get to the problem stage, consider making some changes to help keep the cash coming in and your patients loyal:
Don't Hesitate to Ask
Medical office personnel are sometimes reluctant to ask for payment. Although most doctors' offices post signs that read: "Payment is Due at Time of Service," the staff doesn't always take the rule seriously. So why should patients? Your staff should be trained not to feel bad about firm, diplomatic requests for payment.
It Starts With the First Phone Call
With the next ring of the telephone, your staff can begin to establish payment expectations by politely reminding people who want appointments that their portion of the bill is due before they leave the office.
When accepting new patients, get as much information as possible before the first visit, including names, addresses, Social Security numbers, work phone numbers and emergency contacts. That makes it easier if you need to track them down later. It also gives your practice a chance to assess a patient's financial condition so you won't be taken by surprise if payment becomes a problem. The initial phone call is also a good time to make sure your services are covered by the patient's insurance and find out what authorizations you need.
Before the patient sees a doctor, your office staff can verify the insurance --- and sometimes the status of the deductible involved. If the insurance contract allows it, your employees can ask for whatever co-insurance payment is due (Some contracts prohibit doctors from asking for co-insurance before the payer examines the claim and issues a benefits explanation.) You can also remind the patient if a co-pay or a Medicare deductible is due that day.
Some offices routinely ask new patients to sign statements of financial responsibility, especially if the medical procedures they are about to have aren't likely to be covered by their insurance.
Physicians may want to end office visits by offering to answer questions about payment, or reminding patients that they can pay by credit card if your practice offers that option. Patients who don't mind being difficult with a receptionist sometimes have a harder time refusing payment to the doctor.
If a patient has an outstanding balance that has been ignored, your receptionist can offer to set up a workable payment plan to clear up the account. You might want to suggest an amount they can afford each month, as long as it's reasonable. Once that's done, the receptionist can give them a courtesy card to remind them when the first payment is expected.
Billing -- and Trying to Avoid It
Whenever possible, it's a good idea to avoid generating patient bills that have to be mailed. It can cost more than $5 every time you send a bill. Obviously, for small balances, the amount due can be eaten up quickly by the cost of repeated billing. Once patients understand that payment is expected at the time of service, there should be few accounts receivable. Here are some items to add to each bill:
- Set the time when payment is expected. For example: "Payment Due Upon Receipt of Invoice."
- Remind patients if you accept credit cards.
- State that payment arrangements are available if necessary.
Although the AMA discourages "harsh or commercial collection practices," its policies do state that "a physician who has experienced problems with delinquent accounts may properly choose to request that payment be made at the time of treatment or add interest or other reasonable charges to delinquent accounts."
When doing this, however, the AMA says the patient must be notified in advance of the interest or other reasonable finance or service charges by taking measures such as posting a notice in the waiting room, distributing leaflets describing the office billing practices and including appropriate notations on billing statements. Practices also need to check state laws related to interest and finance charges to ensure they are in compliance.
Outside Collections -- the Last Resort
If you haven't succeeded in collecting on accounts that are 120 days old, the likelihood of securing payment without the help of a collection agency is pretty grim. According to the AMA, however, no account should go to a collection agency or attorney that the physician hasn't personally reviewed and approved. Before taking that step, make every assurance that the accounting is correct and all other options have been exhausted. The AMA also urges doctors to ensure that there are no extenuating circumstances that might make payment a hardship.
If you do need to resort to an outside collection firm, the AMA suggests that you find one willing to use less aggressive tactics, such as letters and phone calls. In no case should a collection agency go beyond letters and calls -- to court actions and other harsh methods -- without giving you the opportunity to review the account first. Actions made by an agency on your behalf reflect on your practice.
Relationships with patients are obviously based on trust. So you probably want to do everything possible to avoid aggressive collection tactics. Establishing payment expectations early and training your staff to collect before the patient leaves your office may be enough to prevent most problems. But when it comes to parting with money, some people who are able to pay remain tightfisted. With those patients, you may have to turn up the heat.