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Use financial counseling to improve collections and patient relationships

April 2014
BY REED TINSLEY, CPA, CVA, CFP, CHBC

As out-of-pocket costs rise, you can offer financial counseling to not only collect more money from patients, but also improve your relationship with them. A report by TransUnion Healthcare finds that the average patient payment responsibility on key medical procedures has grown nearly 22% since 2012, and experts tell us these bills become harder to collect as they grow older.

Automated processes such as credit card on file are helpful, and clearinghouses increasingly offer “real-time” solutions so that practices can get patients’ deductible information while they’re in the office. But you still have to convince them to hand over the money owed.

Demand it all?

One school of thought says you should require all patient-responsible payments to be made at the point of service, even compelling the patient to put outstanding payments on his credit card so that the bank is carrying the debt, not the practice. The best policy is the simplest: You’re expected to pay. If that’s a real change in your practice’s culture, contact the patient before the visit. But practices, especially those who expect to see patients with payment issues, prefer bringing the patient into a friendlier “financial counseling” loop that convinces them to pay more of their debts.

I know of one group physician practice that has financial counselors examine a clinic’s patient financial files for issues, such as outstanding balances and charge-offs, and flag problem files for “outbound benefits education and cash collection” calls. Many offices use billers or receptionists as counselors, but this practice uses dedicated counselors who often come from the world of customer service and receive extra training in health care billing. They come accustomed to talking with patients about billing issues.

Who sees the counselor?

Sometimes calls fail to produce results, but the counselors catch the patients when they return to clinic. Not every balance-due patient is approached during an office visit. Usually the decision about which patients to approach is based on the patient’s prior history with the practice. When a patient is identified for counseling, the front desk tells him or her the financial counselor wants to meet with them. You never want patients to have a possibly embarrassing conversation in reception, so the counseling meeting is always held in a private location within the office. Once with the counselor, the patients are reminded of their responsibilities.

Education works

If patients do not have real financial hardships, they should be asked for payment or collaboration on a payment plan. To increase the chances of getting them to pay, the counselor should educate patients on the terms of their insurance: what it covers and what it doesn’t. I’m sure you’ve experienced it but most people have no clue as to what their insurance covers and what it doesn’t cover.

Other counseling tips

Attitude is important. A person can take the best words and intentions and still come off like a bully. Here is one example of an explanation of non-covered services. You could say, ‘You have no coverage. If you want the service, you need to pay $300 now.” But a better way to explain it to the patient would be to say: “We’ve pulled info from Aetna, and the plan you chose doesn’t offer benefits on this service. If you continue, your responsibility will be X dollars.”

Something is better than nothing. With self-pay patients particularly, a discount program may be your best bet to recover payment before the debt falls into the black hole of collections. For older accounts, give you collectors “settlement rights.” Call the patient, tell them if they can pay __% now, the rest of the account doesn’t have to be paid.