Healthcare reform is affecting more than just healthcare practitioners; it’s also impacting patients. That’s because reform efforts aren’t limited to provider-centric payment initiatives (namely, the push to adopt pay-for-performance models). Healthcare reform also has led to new trends in insurance plans. The number of patients with high-deductible health plans is rising steadily, which means patients are becoming increasingly responsible for the costs of their own care. The result: today’s patients are more invested—and actively involved—in their care decisions than ever before. But, they’re also holding more of the purse strings, which means it’s imperative that clinicians up their patient collections game. That means developing a process for ensuring you’re collecting copays and any other balances your patients owe.

The State of Rehab Therapy in 2018 Guide - Regular BannerThe State of Rehab Therapy in 2018 Guide - Small Banner

Getting Paid Matters

We know—you got into health care so you could help people feel better. You didn’t do it for the money. But that doesn’t change the fact that you deserve to get paid for the services you provide. You are running a business, after all. That being said, it’s crucial to collect what you’re owed—from all sources, not just payers. According to this NextGen Healthcare document, “a greater percentage of practice revenue than ever is coming from patients,” so “better performing practices are taking every step possible to minimize bad debt and optimize patient collection.” The same source cites Medical Economics as saying, “What you collect from insurance companies covers your overhead. What you collect from patients goes to your bottom line.”

Collect Upfront

NextGen also reported that a SuccessEHS study on patient accounts receivable found that only 21% of patient balances that aren’t collected at the point-of-service are ever collected. That means you can kiss goodbye 79% of the money you don’t collect upfront. That’s an awfully big number. With that in mind, here are eight tips for ensuring your patients actually pay (adapted from this source and this one):

1. Communicate Expectations

Be clear about what you expect from your patients regarding payment—and when. That means everyone on staff must know your payment policy and be able to clearly communicate it to patients at touchpoints that you deem appropriate. For example, when a patient calls to schedule his or her first appointment, whoever is doing the scheduling should inform the patient that his or her co-pay—and any other financial responsibility—will be due at the time of service.

2. Verify Eligibility

Before the patient arrives for his or her first visit, you should know the fine print on your patients’ health insurance coverage, including the required copayment (if there is one). That way, you’ll know:

    1. that the patient’s insurance covers your services, and
    2. how much—if any—financial liability falls on the patient.

Having this knowledge at the get-go can be a huge help in ensuring not only proper patient payment collection, but also clean and complete claims. And that, in turn, improves your chances of collecting payments from insurers without having to deal with rejections, denials, or appeals.

3. Estimate Cost

Once you know the patient’s insurance information, you’ll be better equipped to estimate the cost of your services—which, according to the NextGen publication, requires “calculating procedural charges, analyzing historical data, evaluating contract pricing between your organization and the payer, and applying patient insurance benefit information to establish an estimated patient financial obligation at the earliest point of contact.” While cost estimation does require some legwork, the benefits—which include improving upfront collection, boosting patient satisfaction, and minimizing days in accounts receivable—are worth it.

4. Collect Outstanding Balance When Scheduling Next Appointment

This is a good habit to get into: if a patient with an outstanding balance calls to schedule his or her next appointment, take this opportunity to collect the payment due. In fact, you also may want to consider adopting a policy indicating that your clinic will stop seeing patients with overdue balances past a certain dollar amount or date threshold. If they’re unwilling to pay—and unwilling to adhere to your collections policies—they may not be the best fit for your clinic. And if the situation continues, you may end up amassing charges that you’ll never be able to collect.

5. Save Credit Card Info on File

Establishing a credit card on file (CCOF) program can improve collection speed and cash flow. However, you should only keep patient credit card information on file if PCI guidelines–and your payer contracts—allow for it. If your practice accepts credit cards, NextGen suggests that you research the best processing rates and terms.

6. Consider Financing Options

Most patients want to pay their bills and settle their balances—if given the opportunity to do so. According to a 2009 Mckinsey survey of retail healthcare consumers (cited in the NextGen document), the number-one reason patients gave for nonpayment was a lack of financing options. Furthermore, “a 2010 MGMA study shows that 74% of better performing practices assist patients with finances, offering financial incentives to resolve balances faster.”

7. Handle Collections Internally—for as Long as Possible

The ACA International reports that medical practices recover less than $14 for every $100 owed once they turn bad debt over to third-party collection agencies. To keep more of your own money, establish a policy that addresses bad debt, and make sure patients and staff understand it. Then, enforce it.

According to Greenway Health, only 32% of patients who owe money ever receive a collection letter from the practice. Need help creating one? For the secret to collection letters that work—and two free collection letter templates—check out this post.

8. Use Technology

NextGen encourages providers to get creative with their collections methods. While staff may find asking for payment uncomfortable, technology doesn’t. Using kiosks—like those used to print boarding passes at the airport—for check-in and check-out could provide a “familiar way to improve upfront collection of patient copays and outstanding balances as well as increase check-in efficiency.” This way, patients can view their bill and pay with a credit card immediately after arriving at, or immediately before leaving, your office. (You also could use an iPad with a credit card reader attachment.)

Watch for Loopholes

According to the NextGen Healthcare article, “the Affordable Care Act (ACA) promises some positive outcomes, including allowing practices to access more specific real-time adjudication from carriers.” Eventually, this will mean more accurate patient collections. But the ACA isn’t all good for providers. Thanks to a legal loophole, insurers are required to provide patients with a three-month grace period for policy premium payments. Insurers will pay provider claims during the first month that a patient doesn’t pay his or her premiums—even if the beneficiary is eventually terminated for non-payment. However, they can withhold claims—or retroactively take back paid balances—during month two or three. If a patient ends up losing his or her coverage, providers must seek payment directly from the patients.

Want a cheat sheet for optimizing patient collections in your practice?

Enter your email below, and we’ll send you a handy one-sheet you can use as a reference document in your office.

Please enable JavaScript to submit form.
  • Combatting Health Insurance Illiteracy: How to Help Patients Understand Their Plans Image

    articleApr 24, 2017 | 5 min. read

    Combatting Health Insurance Illiteracy: How to Help Patients Understand Their Plans

    Last week, WebPT’s Brooke Andrus wrote a post explaining why patient confusion about insurance coverage can translate into problems for your clinic—everything from angry and frustrated patients to unpaid balances. According to PJ Cloud-Moulds—author of this Physicians Practice post —“there is a huge gap between reality and what the patient thinks happens with their insurance plan.” That’s why—whether it should fall on providers’ shoulders or not—many PTs, OTs, and SLPs are stepping up their educational game to …

  • The Private Practice Owner's Guide to Fair Compensation Image

    articleJul 22, 2016 | 12 min. read

    The Private Practice Owner's Guide to Fair Compensation

    As a business owner, your life would be a whole lot easier if there were set-in-stone rules for determining what’s fair when it comes to employee compensation. Unfortunately, there are not—which is why it’s so important to create compensation packages that not only fall within or exceed local averages, but also feel good for your practice and your employees. After all, everyone in your practice is working toward the same goals: a thriving business and satisfied patients. …

  • MCIDs: What Are They, and Why Do They Matter? Image

    articleDec 28, 2017 | 3 min. read

    MCIDs: What Are They, and Why Do They Matter?

    Things aren’t always as they appear, and that’s certainly true when it comes to measuring the success of rehab therapy treatment. As any therapist knows, if you make decisions based on observational data alone, determining whether or not your treatment is making a difference can prove difficult. That’s why outcomes exist: they give therapists an objective, concrete way to measure patient improvement. But, a positive outcome score isn’t necessarily enough to tell you that your physical therapy …

  • How to Stay in Business in this Uncertain Healthcare Environment Image

    articleJun 29, 2017 | 17 min. read

    How to Stay in Business in this Uncertain Healthcare Environment

    Health care as we know it is changing. But that’s nothing new, right? Health care has been in a state of flux for a while now—what with ever-changing payer regulations and the steady push toward more patient-centric, value-based collaborative care. And while putting patients first is surely good for everyone, increasing regulations—and decreasing reimbursements—can make it challenging for providers to keep up, let alone keep the lights on. That’s why we’ve spent much of this quarter discussing …

  • How to Manage Change in Your PT, OT, or SLP Practice Image

    articleSep 19, 2016 | 5 min. read

    How to Manage Change in Your PT, OT, or SLP Practice

    As the old saying goes, the only constant in life is change. Yes, it’s a bit cliché, but it’s true nonetheless. And for those working in the healthcare space—including private practice PTs, OTs, and SLPs—change is an especially prevalent aspect of day-to-day operations. After all, the whole point of all this healthcare reform hullaballoo is to change the manner in which providers deliver—and receive payment for—their services. So, whether they like it or not, practice leaders must …

  • Suppressing Sticker Shock: How to Handle Your Patients’ High-Deductible Health Plans Image

    webinarFeb 23, 2017

    Suppressing Sticker Shock: How to Handle Your Patients’ High-Deductible Health Plans

    Copayments, coinsurances, unresolved balances—oh my! Any one of these can cause headaches for healthcare providers, but as healthcare reform efforts shift more and more financial burden to insurance beneficiaries, today’s practitioners are increasingly facing all three. And these challenges are not only hurting their patient acquisition and retention rates, but also their bottom lines. Tired of spending time verifying benefits only to lose those patients to copay sticker shock? Stuck in a constant cycle of pursuing past-due …

  • The PT Patient's Guide to Understanding Insurance Image

    downloadApr 3, 2017

    The PT Patient's Guide to Understanding Insurance

    Patients are shouldering a greater portion of their healthcare costs than ever before. But when they don’t know the specifics of their coverage, they can end up with much bigger bills than they bargained for—and that often leads to unpaid balances and unfinished treatment plans. Bring them up to speed—and improve your practice’s collections and patient retention—with this guide. Patients will learn: What it means for a service to be “covered.” How to define common insurance terms. …

  • Automation: The Closest Thing to Cloning Yourself Image

    articleApr 5, 2016 | 6 min. read

    Automation: The Closest Thing to Cloning Yourself

    If cloning were possible, we could be everywhere at once. But it’s not—yet—so, for now, we must resort to finding other ways to stretch our reach. That’s where automation comes in. By identifying the tasks and activities that truly require your warmth and expertise—and then automating everything else—you can maximize your time as well as your staff’s. If you read yesterday’s post on optimization , you may already be connecting the dots: automation is a great way …

  • Down with Denials! 5 Claim Fixes to Make Sure Your PT Clinic Gets Paid Image

    webinarApr 19, 2017

    Down with Denials! 5 Claim Fixes to Make Sure Your PT Clinic Gets Paid

    One denied claim might not sound off your billing alarm bells—but in reality, it should. That’s because—as with faulty plumbing—one leak often indicates a much larger issue. And all too often, rehab therapy practices fail to act quickly enough—and soon find themselves wading in a flood of lost revenue. But there are simple, proven, and affordable ways to not only plug your billing holes, but also reinforce your whole system so you’re less likely to bust a …

Achieve greatness in practice with the ultimate EMR for PTs, OTs, and SLPs.