Recognize the New Face of Patient Collections

Success relies on front desk staff collections and post-claim payment strategies.

by Mary Pat Whaley, FACMPE, CPC
In the past, collections in medical practices focused predominantly on insurance collections because insurers paid the greater portion of the physician’s fee. Thirty-five years later, the pendulum has swung from the insurance company paying anywhere from 80-100 percent of the physician fee to the patient being responsible for a minimum of 30 percent (up to 100 percent) of the charges.
The industry is facing the most significant change in reimbursement since the introduction of the co-pay in the 1980s. New ideas and tools are needed to manage the change successfully.
New Skills Are Needed
Previously, front desk staff identified the amount of the co-payment on the patient’s insurance card and collected that payment. Now, front desk staff must be much more involved in collections, understand insurance concepts, and feel comfortable discussing financial policies and patient responsibility. Confidence, without coming off as overbearing, patronizing, or uncompassionate, is paramount to collection success. This takes training, scripting, and role-playing with staff.
I don’t recommend that front desk staff do all the heavy lifting, however. Every patient coming to your practice should have heard about your financial policy at least three times before they arrive at the check-in window:

  • First time – when the patient schedules an appointment
  • Second time – when the practice confirms the appointment
  • Third time – snail mail, email, patient portal, or however else your practice communicates with patients

Be sure your check-in person can answer any questions and is able to estimate the patient’s payment portion for that day’s visit.
New Technology Is Needed
Very few medical practices have the wherewithal to estimate patient balances without sophisticated technology. Whether it’s applying the unpaid deductible to a typical office visit charge or understanding out-of-network benefits for an in-office procedure, the busy front desk staff are rarely able to provide a fast answer to “What will I owe today?” (if the patient dares to ask).
One technology option that is available at minimal or no cost is keeping a patient’s credit or debit card on file to charge the balance owed after insurance has paid. Although an estimate of the amount due by the patient is always helpful to mentally prepare the patient, sometimes it just isn’t possible to provide this, even at the checkout desk.
The hub around which credit card on file (CCoF) works is called Payment Gateway Software, which allows you to use a small swiper to securely capture a patient’s credit card information and store it in a third-party, offsite server. The credit card information is encrypted and stored on the web (Payment Card Industry (PCI)-compliant), and can be retrieved to charge the patient for post-insurance claim balances, as well as recurring payments such a payment plan. See Chart B for the benefits associated with using Payment Gateway Software for CCoF.

Improve cash flow Improve liquidity, stabilize finances, protect practice against 90-day grace period for exchange plans, handle high-deductible plans
Eliminate statements Reduce collection expenses, deposits, and staff workload in posting payments
Electronic payment plans “Set it and forget it!” Secure and flexible
Eliminate manual patient refunds Improve patient satisfaction with fast refunds, reduce practice expense
Eliminate bounced checks Reduce collection expense (time and labor)
Reduce/eliminate deposits All insurance payments are EFT starting January 1, 2014, with CCoF, no deposits are required
Faster check-in and -out No need to ask for payment!
Eliminate paper receipts Save time and expense
Eliminate third-party collection fees No need to use collections unless card expires
Eliminate cash drawers and making change Reduces theft, eliminates money handling

A New Mind-set Is Needed
The time has come for medical practices to take a stand on patients being required to pay at time of service, or immediately after insurance pays. For longer than I have been in medical practice management, it has been taboo to talk about money with patients. It’s as if the fact that the patient has been provided a valuable service is beside the point. As you know, it’s crucial that medical practices be viable financially, and that means having the “money talk.”
The money talk begins with a clear, understandable financial policy not hidden under the stack of papers the patient signs, or buried deep in the patient portal registration process. Patients appreciate understanding exactly how your financial policy relates to their specific situation, and having the information out in the open.
Succeeding in the new world of patient collections necessitates staff retraining, implementation of time-of-service and post-claim payment strategies, and a willingness to have frank conversations with your patients. Be sure you’re ready to help your practice make it in the new world of patient collections.
Note: Readers can download a free copy of Mary Pat Whaley’s preferred financial policy here:

Mary Pat Whaley, FACMPE, CPC, is co-founder and president of Manage My Practice, a practice management consulting firm focused on solo and small medical practices. With 25+ years managing physician practices of all sizes and specialties in the private and public sectors, Whaley is a physician advocate and practice management consultant. She holds a Board Certification in Medical Practice Management and is a member of the Durham, North Carolina, local chapter.

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Renee Dustman, BS, AAPC MACRA Proficient, is managing editor - content & editorial at AAPC. She holds a Bachelor of Science degree in Media Communications - Journalism. Renee has more than 30 years' experience in journalistic reporting, print production, graphic design, and content management. Follow her on Twitter @dustman_aapc.

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