Make Billing and Collection a Priority Up Front

Ah, the times they are a-changing. And nowhere is that change more evident in healthcare than in the area of billing and collection.

Gone are the days when the physician’s spouse could handle the billing and collection from home. Today the process has become increasingly complex.

As evidence, a recent study by Jackson Healthcare revealed that 62% of physicians believe billing and collection from insurance companies has become more difficult over the past year. Another 61% say billing and collection from patients has become more difficult during the same time period.

David Zetter, founder of Zetter Healthcare, and a member of the National Society of Certified Healthcare Business Consultants, isn’t surprised by the study results.

“The responsibility of the patient has increased exponentially over the last few years,” Zetter says. “As health insurance has become more expensive, employees are paying more, and in turn practices have to collect more money from the patient than they were in the past.”

Good financial policies

As medical professionals, physicians are adept at diagnosing medical problems, but they don’t always have the expertise or the time to stay on top of the business end. That’s why it’s imperative to have good financial policies in place where virtually every employee in the practice is a collection agent.

For example, Zetter says receptionists need to have tools available to them so that when the patient comes in, they know what their balance on account is, they know what their copay is, and they know how to communicate it to the patient so they don’t feel awkward asking for money.

“If it’s done right, if you provide them with a script so that they can say it easily in their own words and it doesn’t sound canned and make it awkward, they’re more likely to get that done,” Zetter explains.

That script, says Zetter, should be short and to the point. For example, “Hello Mrs. Smith. Your copay today is $20. How will you be taking care of that?” Too often, however, Zetter says that conversation goes as follows: “You have a $20 copay. Do you want to pay that today?”

“You don’t give them a choice,” he explains. “And if the patient says they don’t have it, as long as it’s not an acute or emergent situation, then that patient needs to be rescheduled. Because the policy is, you pay your copay when you come to a visit.”

No pressure

Zetter says that, if trained properly, there is no pressure on the staff, or the physician for that matter, when it comes to collections. The copay, he explains, is a contract between the employer, the patient, and the insurance carrier. The contract between the practice and the carrier says that the practice must collect the copay. If the patient doesn’t pay the copay, he or she is in violation of that contract.

“All you have to do is say one time to that patient, ‘I’m sorry Mrs. Smith, but your contract says we have to collect that copay. If we fail to collect it, we can be discharged from that contract, and we would no longer be available to provide services to you. I’m sure you don’t want that to happen,’” Zetter illustrates. “Very easy, simple scripts, communicated properly. It can put a guilt trip on them.”

Going through that process while training your staff and revamping financial policy may take some work, Zetter admits, but the change is well worth it.

Analyzing the bottom line

Maximizing your billing and collection efforts doesn’t end with collecting the copay, however. Zetter says it’s critically important to have the proper metrics in place to analyze trends. For example, how much of accounts receivable is comprised of copays? It’s important to understand which patients had copays, who paid it and who didn’t, and then follow up with staff members to find out why the copays were not collected.

“Run patient account reports, and provide billing and collection metrics to your staff so they can see the data over a period of time.”

And, adds Zetter, make certain to have current fee schedules from your payers.

“If you have them entered into your practice management system, then when the carrier pays you $100 for a service, your practice management system would flag that and say you should be paid $104 instead,” Zetter says. “That increases the percentage of what you are under-collecting. Re-train your staff, and help them understand that the days of old are gone. You can’t [not collect what you are properly owed] or you’re going to go out of business.”