Our medical billing department actively engages with our healthcare practitioners including wound specialists, professional nurses in practice, specialists, and general practitioners. These healthcare practitioners work long hours and, like any other business, have to keep a close eye on their revenue, expenses and cashflow as they have to pay accounts, order stock, and pay salaries.
Of late we have noticed a substantial increase in unpaid patient accounts, and we have been busier than ever to recover unpaid debt through interventions and patient payment plans, to improve our healthcare practitioners’ cashflow and levels of revenue.
But what can you do, from a practice management’s point of view, to improve the overall payment of outstanding accounts? We believe a better understanding of the overall picture will go a long way in reducing outstanding debt. Here are 5 reasons we found why patients don’t pay their bills and what you can do about it:
Of late we have noticed a substantial increase in unpaid patient accounts, and we have been busier than ever to recover unpaid debt through interventions and patient payment plans, to improve our healthcare practitioners’ cashflow and levels of revenue.
But what can you do, from a practice management’s point of view, to improve the overall payment of outstanding accounts? We believe a better understanding of the overall picture will go a long way in reducing outstanding debt. Here are 5 reasons we found why patients don’t pay their bills and what you can do about it:
1. INCORRECT CLIENT INFORMATION
The entire relationship with a patient starts with obtaining and recording the correct client information. Here we are referring to the basics such as telephone number, email, physical address, medical aid details etc. Without this basic data set, it is virtually impossible to do any follow up actions.
Take the time to implement a client management system, both electronically and in a manual format (if possible). This information is vital to follow up on payments (late or otherwise), confirm further appointments, and to provide other services to the patient.
2. MEDICAL AID SUSPENSION
This may come as a surprise, but in many cases a patient’s medical is suspended as a result of lapsed premiums or a depleted savings account. In many instances, patients are not even aware of this. The lapse in premiums can be due to unemployment or other financial or account issues.
There are two ways of dealing with this matter. Firstly, if it’s a new patient, let them settle their first consultation account in full, and let them claim from their medical aid. This gives your administrative team an opportunity to verify the medical aid details and to properly set-up the patient account. Secondly, if it is an existing patient, let your administrative team confirm the current medical aid details and that the account is still active.
3. LOSING TRACK OF ALLOCATED PRESCRIBED MINIMUM BENEFITS (PMB’S) SESSIONS
When patients are awarded PMB status, they receive a limited number of sessions. Some patients divide these sessions between different healthcare practitioners. In some practices the healthcare professional keeps record of the sessions, in others the onus of managing the number of allocated sessions is the responsibility of the patient. As a general rule, we find that the practices keeping track of the PMB sessions, have less issues than those who leave it up to the patient to manage.
An effective Customer (patient) Relationship Management (CRM) system will make allowance for adding and keeping track of PMB sessions, which would make it easier for administrative staff to manage, and indirectly improve, the financial management of that patient’s account.
4. INEFFECTIVE PATIENT ACCOUNT MANAGEMENT
We find a great deal of payment issues can be avoided if the interaction between the patient, the practitioner and the management team is done efficiently. Send invoices to clients as soon as possible and make sure you can process card, EFT, and cash payments at the practice.
Get into the habit of immediately notifying clients if there are issues with processing or receiving medical aid payments. Flag problem accounts early on in the process and ensure that there is a well-defined late-payment penalty clause printed on your invoices, and that patients are aware of this.
5. PATIENTS DON’T SHOW UP FOR APPOINTMENTS
While the matter of billing patients who did not honor an appointment is a contentious issue with certain ethical implications (a topic I will write about at some point in the future), it is still fair for a practitioner to expect compensation for the lost appointment, even if only a partial payment. Keep in mind, in certain cases patients just honestly forgets or have a real unforeseen emergency. The best way to deal with these incidents is to take each case on its own merit. A great starting point for any healthcare practitioner is to evaluate the real financial impact on your revenue of no-shows.
A proven way of dealing with no-shows is to implement an automated sms-system (some CRM’s offer this as a function) to remind patients of their appointments. In conjunction with such a system, it will also be wise to implement a cancelation policy. Such a policy can create a framework for full or partial payments depending on the cancellation period. Same day cancellation or no-shows, for example, will attract a cancellation fee, but cancellations 48 hours prior to the appointment will have no cancellation fee implications. Of critical importance is that the patient is informed, and acknowledges being informed, about the implementation of a cancellation policy.
CLOSING REMARKS
The golden thread that runs through all the matters under discussion, ultimately comes down to implementing effective administrative management, and taking a pro-active approach to management of the practitioner-patient relationship. Effective financial management of a healthcare practice starts with something as simple as checking the status of a medical aid or confirming a patients employment.
Clear, open, and regular communication with patients go a long way in keeping outstanding payments under control. If your outstanding debt is approximately double the size of your monthly invoicing, then you should definitely give us a call for a free and no-obligation consultation on how to reduce your levels of patient debt.
Please feel free to explore some of our other Medical Billing blog articles specifically for Healthcare Practitioners.