Collection Costs on the Rise

In previous posts, we presented the risks and challenges facing healthcare providers in the face of high deductible health plans: patients may not have funded their HSAs sufficiently in order to cover the amount of their new higher deductible, and employers and plan administrators may not have adequately educated their employees and members regarding the risks and responsibilities that come with these new plans.  These factors cause risks and challenges of their own, with many potential hidden costs.

First, providers are put in the awkward position of providing the needed education that should have been done by the employers and the plans.   

Second, if the patient has an in-network plan, the provider’s contract may prohibit collecting cash at the time of service.  The provider is also required to submit a claim on behalf of the member.  If this is one of the first claims of the plan year, it’s likely the entire allowed amount will be due from the patient.

Third, the provider will still need to expend all of the same resources to have the claim processed as they would if they were getting the cash from the carrier.   

And last, not only does the provider expend the resources for processing the claim, but also for the expense of the subsequent statements and patient follow-up.  This could lead to a delay in payment for another 15-30 days or more.

Given these hidden costs, favoring upfront collections when at all possible is the best strategy.  Revisiting legacy contracts that are prohibiting this practice should be a priority.

On Call Medical implements and manages highly customized, comprehensive and cost-effective medical billing and account receivable solutions proven to dramatically improve the profits, revenues and quality of life for independent health care providers.

What is the role of the follow up visit in the revenue cycle?

Did you collect the copay at the initial visit?  

Has the payer processed the first visit claim?  

What is the patient responsibility?  

Have you automated the follow up call?

This is yet another opportunity to make a real connection with your patient.  The patient may be considering whether to make your practice their medical home.  In addition to reminding the patient of their visit, make a connection, ask how they’re doing, askabout the kids, make sure the person calling can make a personal connection, remind the patient of their outstanding balance, can they pay now or will they bring the amount due with them to the visit.  It’s likely the patient just forgot and will be more than willing to make the payment immediately, they just need to be asked.  Thank them and remind them that you look forward to seeing them.

Patients are looking for basic customer service.  Train for this, and you will stand out from the crowd.  Patients will be coming back and sending their friends and family.

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On Call Medical implements and manages highly customized, comprehensive and cost-effective medical billing and account receivable solutions proven to dramatically improve the profits, revenues and quality of life for independent health care providers.

Is it possible to collect at the time of service if the total might change?

This question addresses the issue of good faith estimates.  Being able to generate a good faith estimate is essential in today’s healthcare office.  As patients and insureds are experiencing more coming out of their pockets, price has become an important factor when deciding on providers and procedures.  And if you are not the least expensive in town, you especially have to communicate your value and differentiate yourself in the healthcare marketplace.  

In order to provide an accurate estimate, several questions need to be discussed and updated processes put in place.

• Do you know your contracted rates for each carrier with which you have a network agreement?
• If so, is this information available in a usable format?
• Do your carrier agreements prohibit you from collecting from patients until after the claim has processed?
• Are staff trained to use carrier rate information to generate estimates?
• Who is responsible for compiling and producing the estimates?
• Is an estimate viewed by staff as a hassle or a patient relationship building opportunity?
• How do you use the good faith estimate to communicate your value?
• What is your disclaimer?  Has it been reviewed by counsel?
• Have all staff been trained to respond to a request for an estimate?
• Are you proactive in providing estimates?

Even if the cost of the procedure(s) do change, a good estimate process will minimize issues down the road.  The estimate provides staff with important information when talking with patients in the collection process, should that be needed.

In Minnesota, providing a good faith estimate is not an option, it’s required by law when a patient requests one.  An on-line service, Medcare Compare, gives the provider an easy tool to generate a good faith estimate for patients.  Once configured, this tool is easy to use and saves the office staff considerable time and frustration. 

The new healthcare environment is presenting yet another opportunity.  Are you taking advantage of it? Are you using good faith estimates?  What is your experience?