In July I wrote an article on "Maximize Reimbursement: 4 Strategies for Success", which can be found by clicking here. Here is a follow-up article containing strategies on maximizing the accounts receivable (A/R) process.
Today's tough economic times put more strain on patients to meet their financial obligations, which puts even more pressure on providers to remain profitable. The following strategies will increase the likelihood of being paid promptly, while being considerate to those patients with limited means to pay.
Arranging for payment prior to a patient's procedure substantially increases the chance of collecting outstanding balances while decreasing the staff costs to collect outstanding balances. Medicare and several other payers prohibit providers from collecting patient portions prior to claims being adjudicated. So, what can be done? Successful centers are utilizing a credit card authorization form which authorizes payment via credit card up to a certain dollar amount once the claim is adjudicated. So the contractual issues of collecting from patients prior to their procedures are averted, while the chances of collecting payment increase significantly.
Providers are encountering an increasing number of patients without the ability to pay their high out-of-pocket costs. It is recommended therefore to have a sound financial hardship/charity care policy in place. This policy should be applied to any patient claiming indigence, and include discounts based on the Federal Poverty Standards put out yearly by the U.S. Department of Health and Human Services.
An alternative to patients who don't qualify for charity care but are having difficulty paying their out-of-pocket costs is to offer financing through a third-party financing company. One such company, CareCredit, offers patients interest-free financing with six, twelve, and eighteen month plans. The cost to the facility is marginal, and is easily offset by savings in staff collection costs and time value of money. The center will receive payment in full, within two business days wired directly to their bank account. In most cases, the financing company assumes all the risk, so if the patient defaults no money is offset to the practice. In turn, the patient gets a longer period of time to pay their balance interest-free, so it's a win/win situation.
Patient financial counseling is an often overlooked position in many ASCs, especially in smaller centers. This position is very important however, to ensure patients understand their benefits and to make arrangements for payment. The patient financial counselor should explain the benefits in detail to all patients, arrange for payment of out-of-pocket costs, and assist indigent patients in applying for financial hardship/charity care. Even if a center opts not to arrange for payment in advance, the chances of a well-informed patient paying their financial obligations post-procedure are much more likely than one that hasn't undergone financial counseling.
Another way to ensure you're maximizing your A/R process is to have a sound collection policy in place. The collection policy should specifically state what happens to accounts as they age. Many facilities turn their account over to pre-collections after 60 days. Once the pre-collect letter service has expired without payment, the accounts are turned over to a collection agency. Patients should incur a charge when their account is in pre-collections and again when s/he is sent to the collection agency. The policy should also set guidelines for follow-up. For example, patients with balances less than $500 will receive at least one follow-up call, while balances greater than $500 will receive three follow-up calls from the facility prior to being sent to pre-collections.
Finally, ASCs should have a solid financial policy in place specifically stating the center's billing and collecting practices, as well as the patient's financial responsibilities. If a facility decides to implement a pre-collect and/or collection agency charge, they should be specifically stated in the financial policy. It's also advisable to include language that it's ultimately the patient's responsibility to understand their medical benefits as well as any charges denied by their private insurance carrier.
By arranging for payment prior to procedures, increasing payment options for patients through financing companies, implementing a charity care policy, and performing financial counseling for patients, centers increase the likelihood of being paid promptly for procedures. A sound collection policy backed up by an implicit financial policy provides the groundwork for continued A/R success.
Learn more about Regent Surgical Health.
- Hospital/Surgeon/Management Company Joint Ventures: A Key Strategy For New and Continued Success For ASCs
- Maximizing Board Productivity
- 4 Current Trends Driving the Value of ASCs