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January 08, 2014 12:00 AM

Practice Makes Perfect: Defining an approach to self-pay patient collections

Owen Dahl
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    Dahl

    Last June, the Medical Group Management Association released the results of a questionnaire that ranked members' most-pressing practice management challenges. In this edition of "Practice Makes Perfect," we'll tackle No. 4 on that list: collecting from self-pay, high deductible and health savings accountable patients.

    Medical practices are continuing to explore new and innovative ways to serve patients. Often, collecting for services provided is secondary. According to the MGMA Cost Survey report, multispecialty practices reported 3.4% of total practice revenue from self-pay collections. Some practices report a much higher percentage of revenue from self-pay collections. This could be a result of patients having higher co-pays, high-deductible insurance plans or practices serving more uninsured patients. Whatever the case, it is important for your organization to have a well-structured approach to patient collections. This includes defining the who, what, where, when, how and why of your collections efforts.

    Who: The entire practice staff should understand the patient collections protocols. It is important for staff to be trained properly in contacting patients' insurance companies and verifying their plans before their visits to determine whether their insurance is valid and what copays and deductible amounts can be collected. Almost every patient will have some amount of out-of-pocket responsibility. Keep in mind that Medicare patients might be part of a Medicare Advantage plan, so they will have different copay than the 20% due from traditional Medicare patients.

    What: Train staff not only to complete the verification of coverage, but also what to do with this information. This could be as simple as collecting a $20 copay from the patient, but it could also include a deductible, especially if the patient is seeing a physician for something other than a “routine” office visit.

    Where: The most effective patient-collections method is through the front-office staff at the time of an appointment. This eliminates the statement mailing costs and is an opportunity to ensure that the patient understands the bill. Make sure to properly prepare the front-office staff to answer questions about patients' bills and provide information to help patients who might need payment plans or other options.

    When: There is always difficulty in determining when to collect from patients. The basic recommendation is to collect prior to service. However, in certain cases where additional services might be provided, or there is uncertainty about what level of code will need to be provided, it might be better to wait to collect after the visit at checkout.

    How: Staff should be well-trained and use scripts. In many years of working with organizations, I've also found that it helps the staff significantly when they practice the scripts and run through different scenarios. It also helps staff understand how best to serve patients and how to answer frequently asked questions.

    Practices might run into situations when a patient cannot pay at the time of visit. This requires billing the insurance company and then sending a statement to the patient. If the patient is unable to make payment then, it is necessary to define what constitutes a “delinquent account” —the number of statements that have been sent to the patient rather than the number of days the bill has been unpaid, for example—and what will be done with an account once it has becomes delinquent.

    Owen Dahl

    Independent consultantMedical Group Management AssociationEnglewood, Colo.
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