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COLLECTIONS

Why you need an office policy on collecting fees

Most medical practices take time once a year to create new office goals or a business plan and, hopefully, to upgrade their policy manuals. And consideration of collecting on co-pays and deductibles needs to be an integral part of that business plan, according to Michael Glass, a medical consultant with Transworld Systems Inc. (TSI).

Why bother with an office policy?

The business of medicine is becoming increasingly challenging. Doctors across the United States are experiencing significant organizational changes, enhanced technology, and an ever-changing regulatory environment. In that climate, according to Glass, having sound office policy on collections is more important than ever.

Imagine building a house without a blueprint or taking your family on vacation without a destination or itinerary. “Your (medical) practice is no different,” says Glass. “Without formal planning and office policy you will miss good opportunities and make serious and expensive mistakes.”

Two parts of a well-designed medical practice are office practice versus office policy. Legally, Glass says, there is a significant difference between the two.

“The lowest level of organizational behavior is a business practice,” he says, adding that this includes the day-to-day responses to patients coming into your office or calling in.

“Certainly, we all get good at just responding to the ongoing daily events,” he says. But it helps to have a policy guide those responses.

Creating an office policy on collections

Everyone benefits from having strong office policy. That process begins with sitting down with your staff and physicians and creating good culture and communication around developing office policy. Hopefully, you are consistently examining and discussing what has changed in your practice and what should be a priority in the coming months. And collections is likely on the priority list for every practice.

“An accepted office policy on collecting co-pays and deductibles is important. Discuss and create one for your office,” says Glass.

If you are billing patients afterwards for services rendered, Glass says there are three key items you need to consider:

  1. A hard date for payment.
  2. Elimination of any references to bills being 30, 60, 90 or more days old. This only encourages patients to delay paying for as long as possible.
  3. Having a reference on the bill to the option of paying on-line and telling them how to do so.

Many medical offices are now asking patients for a copy of their credit cards to be kept on file so that any incidentals can be billed directly to a card. You can explain to patients that doing so is a way to keep office costs under control. (Remember: It is important to notify patients when payments are charged to a credit card.)

If bills remain unpaid and members of your accounts receivable staff are talking to patients, the conversation should end with an agreement by the patient to pay the bill by a firm date.

If the patient still does not pay, your policy should be that staff will either telephone the patient or send a letter saying that if payment is not received by X date, the matter will be referred to a collection agency.

Putting your office policy in action

Once you have created office policy, you need to put it in a manual. That manual should be sitting on the table at every staff meeting, so that people can refer to it. The manual needs to be reviewed and updated periodically to ensure it is up to date with current laws and requirements, and that payment procedures are understood and consistently applied by all staff.

For example, your front-line office staff likely tell patients to bring either a debit card, credit card or checkbook along with them to their appointments. It can help their efforts, when staff can say to patients that it has been the office’s policy since (whenever) or that the doctor has asked them to collect fees from patients at the time of service.

“It will make a significant difference in keeping your office running smoothly,” he says.

Glass also recommends having payment options readily accessible on your website to make it easy for patients to pay for their share of services.

Conclusion

Glass says a medical office that does not have good policy surrounding its operation will struggle.

If good people are employing mediocre policy, or if mediocre people are using good policy, there may be frustrations, but the results will still often be satisfactory. However, he says, if good people are employing good policy in a medical practice, the results will always be good.


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