10 ways to cut unpaid medical billings
How often do your delinquent accounts cross the line into pro bono or free service because patients ignore them?
"It should be the physician who decides who gets the free service through an explicit arrangement with the patient," says Denver-based Transworld Systems Inc. district manager Yon Regan.
Yet when a practice lacks assertive collection procedures, it effectively allows many collectible debts to become charity by default. "And, it's the unintentional pro bono that pulls you under," Regan explains.
If you follow Regan's tips described below, you can prevent many debts from occurring in the first place and improve the payment rates on your accounts receivable:
1. Write a collections policy detailing who will ask for payment and the point that will occur in the patient encounter.
Develop and adhere to a billing schedule.
2. Stipulate in your policy that copayment is due when services are rendered.
A discreet plaque at the registration desk spelling out your policy prepares patients for a verbal request. "It ruffles some feathers, but it's best to ask for copayment upfront," advises Regan. He adds, "If people are not prepared with their co-payments, explain that you will reschedule their appointments for a time when they will have their copayments."
Do staff know tactful ways to collect?3. Train your staff how to tactfully ask for copayments.
Emphasize the importance of this procedure. (Watch upcoming issues of QI/TQM for suggestions on developing scripts to help your front office staff acquire those skills.)
4. Don't let copayments slide.
Regan warns that insurance companies and managed care organizations have been known to interpret that practice as a way for providers to pass co-payments on to the insurers. Insurers, in turn, bill the providers for each co-payment not collected from patients.
5. Send out patient bills and insurance claims promptly.
6. Keep current on unreported address changes by taking advantage of the U.S. Postal Service's address correction feature.
Here's how it works: Print "address correction requested" on your billing envelopes one or two lines below your return address. If your addressee has moved without notifying you, the Post Office will note the forwarding address (or absence thereof) on the envelope and return it to you for a 20-cent fee.
Have policy in place for billing mistakes7. Contact all overdue accounts every month.
8. Develop a procedure for correcting billing errors.
If you make a mistake on a patient's bill or insurance claim, admit it and correct it promptly.
9. Learn your state's collection rules for creditors and follow them to the letter.
Contact your state attorney general's office for local laws.
10. Don't delay using third-party collections assistance.
"The typical national average on a past-due medical account is 273 days," Regan notes. "And that's way too long." He suggests using flat fee agencies who charge $5 to $10 per problem or patient. Understand that while applying the suggestions on this list will significantly reduce your delinquent accounts, some debts will escape your best efforts and even those of collection professionals.
[For more information on developing effective collections policies and procedures, contact Yon Regan, Transworld Systems Inc., 303 E. 17th Ave., Suite 210, Denver, CO 80203. Telephone: (800) 480-0741 or (303) 832-1011. Fax: (303) 832-1064. E-mail: [email protected].]
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