RMK HOLDINGS INC.
Five Ways: Prevent Bad Debt Collections & Patient Balances
Updated: Dec 6, 2022
Moving accounts to collections might work for some patients but it is still a last resort step. You want to keep bad debt collections at a minimum. Although there are techniques to help prevent bad debt collections, the idea is the same - collect as much as you can, as early as you can.
Receiving payments at the front end means they will be gone at the back end. And as you know, old debt is hard to collect! Why? Some reasons include bankruptcy filings, relocation, misplaced records, and department turnover.
Unfortunately, because of the health care system with its growing deductibles, copays, and specialty pays that increase the financial burden on your patients, the number of them avoiding payment is also growing. In fact according to industry stats, multiple healthcare providers report that more than 50% of patients with commercial insurance are stalling on payments. Here are five thoughts about heading off collection transfers:
1. Broaden Payment Transaction Points
Make sure the ability to swipe a credit card is no more than a few minutes away. Some hospitals and physician practice groups are installing card readers in every department and as a result, have noted double-digit increases in collections.
2. Collect at EVERY Touchpoint
A touchpoint occurs at a human interaction between provider and patient. Make sure these instances include a collection opportunity or a frank discussion about the patient’s financial obligations. Ensure the patient always know what they owe. The role of collecting is no longer just limited to the back office.
3. Implement an Early Out Collection Process
An early out program increases the number of self-pay payments prior to sending to collections, as patient contacts are increased over and above what your billing team can complete. These are patients that you help with payment arrangements and by establishing a good working relationship before matters deteriorate toward the collection stage. Often, it’s good to engage with early out partners that know the ways to contact and locate self-pay patients. They generally increase recovery thereby preventing bad debt collections to traditional third-party collectors.
4. Establish a 24/7/365 Payment Option
Paying bills online has become a normal way of doing business. Not having an online option available may even prevent patients from paying for healthcare services.
5. Accept All Payment Types
This means any credit card, cash, check, and short and long-term payment plans. Also, be willing to work with those struggling to pay. Some combination of down payment, credit card and check might work.
Finally, every member and organization stakeholder needs to be aware of the financial approach in your practice and act accordingly. Schedule training for those hesitant to bring up financial matters to patients and include role playing - both live and over the phone. This will aid to boost your team's approach, confidence, recovery.