An 8-surgeon group in the Southeast had a history of high patient receivables, the result of a long-held culture of “We’ll submit to your insurance and bill you after insurance pays.”
The billing and collections staff worked in the basement—far away and out of sight of the patients who showed up for their postoperative visits owing big bucks.
In a flash of wisdom, the administrator agreed to move the patient-balance collector into a converted closet near the check-out area, and provided the information, tools, and training that enabled her to speak with patients about their balances when they came in for an appointment. In her first month in this role and location, this employee collected more than her annual salary from patients.
It Takes a Program
This is one of our favorite client success stories, and it illustrates a key point: point-of-service (POS) collections do not have to be complicated. But the process does have to be deliberate and coordinated. Practices cannot simply update the financial policy and hope the staff members magically begin collecting. If this is your strategy, we promise that it will fail.
Successful POS collecting requires a program approach. And this approach starts at the front-end of the billing cycle, not “after insurance pays.”
POS collections have never been more important. Health insurance exchanges and payers are increasing deductibles and coinsurances. Physicians are opting out of network. Given these realities, POS collections are vital to your cash flow and effective receivables management.
If you are starting practice, you have a perfect opportunity to open with POS collecting in place. A solo surgeon whom we set up in practice did so, and has collected up-front for office services, scans, and surgeries from his first day in practice. Today, the practice’s only outstanding patient receivables are those of patients on payment plans—and these are less than 1% of total accounts receivable.
We also converted the “after insurance pays” philosophy of a surgeon in the South, implementing both POS collections and surgical deposits. In the first month, his patient payments increased by 40%. Another solo orthopedist reported an increased take-home salary of $90,000 in the first year after we helped his staff collect surgery deposits.
Six POS Program Elements
In 30 years of implementing or training staff to implement POS collections, we have come to recognize the following 6 key elements to include in your program approach: Policies + Procedures + Technology + Training + Monitoring + Coaching.
At a high level, here are the actions your practice will need to take:
1. Update the financial policy with 1 written standard for all physicians.
2. Develop granular procedures driven by the policy; these are the “how-tos” that enable the staff to collect successfully.
3. Implement new technologies, such as cost estimators, recurring payments, and online bill pay.
4. Schedule formal training to ensure that staff members know how to ask for money. (Do not assume they are, can, or will without training.)
5. Measure and monitor the outcome of patient collections and staff performance.
6. Provide ongoing coaching and oversight to maintain motivation and skills.
A blueprint for addressing each one of these actions follows.
1. Update the financial policy
The policy is the set of expectations on which to build all procedures and training. Dust off this document, and review it as a group with the practice administrator. First, strike old language that says the patient will be balance-billed, or will only be asked in the office for his visit copay. Next, strive for clarity. “You will be asked to pay your financial responsibility at the time of service,” really says nothing. Instead, the policy should be direct:
If you are recommended for surgery, our staff will calculate your coinsurance and unmet deductible amounts: 50% of this amount will be collected as a surgery deposit, and the remaining 50% is due on or before the day of surgery. Payment plans are available.
For office visits and services, break down the policy by coverage type. We find that a table such as the one shown makes expectations clear.
Finally, strive for 1 standard policy for all providers. If every provider is allowed to create his or her own set of collection policies, the practice is setting staff up for complexity overload, and collections will suffer.
2. Develop granular procedures
Few practices take the time to translate the financial policy into written procedures that can be followed by staff. The policy establishes the rules, but the procedures tell staff what to do to implement those rules. For instance:
