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Podcast: Time of Service Payment - Customer Service and Cash Management

Tom Hajny

Time-of-service collection is a critical component of the financial success of your practice and its customer service mission. The benefits are:

Provides information to the patient – prior to the first visit – enabling them to do personal financial planning q Provides a forum and process for communicating your practice’s financial expectations and mission q Expedites cash flow from patient portion by an average of 60 days q Lowers bad debt expense through effective financial counseling and credit risk management q Heightens staff productivity through reduced self-pay collection follow-up q Lowers cost through reduced statement processing q Fulfills utilization controls of managed care firms (Deductibles, co-payments and co-insurance are designed to remind patients healthcare is not free and to be part of the utilization management process – in fact, many contracts require practices to collect co-pays at time-of-service)

If you have in place an effective pre-visit registration process, a collection at the time-of-service program is already 99% complete. Prior to walking through your door, the patient will be aware they are expected to pay at the time of the visit, any alternative financing option you may offer (i.e. installment plans, financing programs, etc.), and the amount of their expected payment. It will be the mere act of asking, “Will you be paying by cash, credit card or check?” to complete the process.

The Psychological Advantage

A person’s thinking about paying a healthcare bill changes radically the moment they leave the clinic without paying. Before service and at the point-of-service, their health is the number one priority and they have the mind-set of a patient. They are motivated to make payment because they are motivated to maintain or restore their health.

When they leave the clinic, they are no longer a patient – they are now an economic animal with obligations to many different creditors – mortgage payments, credit card payments, utility bills, and their children’s education needs. Your bill will begin competing with all other bills, and, if the patient’s financial situation is tight, your clinic’s bill will always come in last.

Do not lose the psychological advantage. Ask for payment when the patient is most motivated to pay.

The Largest Obstacle to Implementing Time-of-Service Collections

Effective time-of-service collection programs are all about attitude – to be effective your staff has to believe in and sell the program. Programs fizzle because the staff is just too uncomfortable with the idea of asking someone for money. Therefore, take the time to facilitate meeting(s) with your staff to discuss their concerns and to help them develop their collection skills.

Concerns which you may encounter – and a response:

“Asking people for money is bad customer service.”

Yes, surprising people by asking for money - without informing them of your expectation of payment at the time-of-service - is bad customer service. But in the pre-visit registration process you have set the stage for them to expect you to ask them for payment. Any objections have already been overcome. Giving people information to make informed decisions about their financial obligations is great customer service.

“I feel uncomfortable asking people for money, it seems rude.”

In every other phase of a patient’s life they expect to make payment (or arrange for payment) at the point of sale. Staff needs to understand the patient will not be offended, and their fears of the “hostile” patient are unfounded. Have the staff, as a group, write scripts responding to their worst fears. Have them act out the scripts until they feel comfortable. Some staff will be more comfortable (and better at) than others in asking for payment. Rotate staff to see who can get the highest collections – ask the top performers to share their secrets to success with the others.

“I feel uncomfortable handling money, if it gets lost, I’ll be blamed.”

Explain to staff there are accounting procedures to ensure cash is reconciled. These procedures protect the people who handle cash from being accused unfairly of losing or stealing the money. Show them the cash receipts process and how cash will be safeguarded.

Helpful Reminders – Signs and Brochures

You can’t say it too often or in too many different ways. Discrete signs indicating payment is expected at the time-of-service should be displayed at the reception and cashier areas. If, under your managed care contracts, the practice is obligated to collect co-payments and deductibles at the time-of-service, this very helpful information should be displayed.

Brochures, which describe the financial expectations for the patient, should be developed. It should also include information for the patients who are under financial duress and would like financial counseling. The brochure can be effectively used in the financial counseling interview process to walk the patient through the policies of the practice and provides them with a document for future reference. At the patient’s first appointment, have the patient sign an acceptance of the financial policy further enhances a patient’s understanding of the practice’s financial expectations.

Goal Setting

The ultimate goal for time-of-service collections is 100% of all payments for non-insured patients’ self-pay balances and insured patients’ co-payments, deductibles, and co-insurance. However, the first step in the process is to establish a current experience as a baseline for improvement. If your current experience is 10 percent collection of non-insured balances and 30% of co-pay collections, it is unreasonable to expect 90 percent effectiveness next week. In this case, set interim goals leading up to your practice’s effective 100 percent over an appropriate period of time.

High Risk Credit Patients

There will always be patients who present special problems. Despite your best efforts at patient counseling before service, some patients will not be prepared to pay. As your pre-visit registration process improves, the number of patients filling this category will diminish – but what do you if…

…If they are a consistent problem and appear with prior accounts unpaid; it is time to do some financial counseling.

q Find a confidential area where you can talk to the patient q Explain to the patient the policy of the practice and ask them what special circumstances they are under which prevent them from paying their accounts q Listen to their concerns. Only three percent of patients who do not pay are true delinquents – the other 97% have good intentions but need help in their personal finances q As the patient explains their financial situation you will see opportunities which could aid the patient in fulfilling their obligation q Be prepared with the alternative financing options (interest-bearing installment plans, outside financing, or credit cards)

The financial counselor’s mission is to provide information to the patient so they are better able to make decisions. It is also the mission to overcome any obstacles to payment and – before the patient leaves – get a commitment (time of payment and amount).

If, after an examination of their financial status, and it is determined they are able to pay - but refuse – or are habitual credit delinquents then you may come to the conclusion they need to seek services elsewhere. In your Credit & Collection policy address the conditions under which a patient would be terminated. In the Termination Policy detail procedures for notification, time periods, and exclusion for emergency services.

I Left My Wallet in My Other Pants…

For those well-meaning patients who forgot to bring their credit card, checkbook, or cash, there is a technique which makes it easy for your patients to make payment while emphasizing the practices financial policy of payment at the time-of-service. Give to the patient a form, which indicates the amount owed and the payment method (check or credit card). Also, include a self-addressed stamped envelope. Request as soon as the patient returns home they fill in the credit card information (or make out a check), put it in the envelope and mail it back to the practice – today. Hopefully, they won’t forget their credit card or checkbook next time.

11:22 5.35mb download Financial Management

Greenbranch Publishing