Double Your Cashflow

One of the most neglected areas of the billing process is the healthcare provider's strategy on collections. Healthcare providers are notoriously weak in this area and, as a result, have spent decades giving their services away for free. They assume that patients will gladly pay their bills so rather than collecting at the time of service, providers opt to send out patient statements. They also assume that patient payments never really amount to much so they don't aggressively pursue collections. Unfortunately, these assumptions have bankrupted 20% of providers in Ohio alone. 

When you stop and take the time to do the numbers, these "at the time of service collections" will make or break your business. Let's say outstanding balances and co-payments amount to a total collection of $100.00 per day. (This is a very small number, but we'll use it anyway.) That amounts to $500.00 per week. That's $25,000.00 per year (50 week year). Now imagine your yearly totals when you begin implementing an aggressive collection strategy. But there's more…

Along with doubling your cashflow, "at the time of service collections" will sharply reduce the cost of statements, outside envelopes, return envelopes and postage, while also freeing up your staff for other work or even eliminating some staff members altogether. Aggressive "time of service collections" will significantly reduce the need for billing a patient 2 or 3 times requesting payment (that is IF payment is ever made). "Time of service collections" will considerably reduce collection problems which translates into a decreased need for a collection agency.

Medical insurance companies have known for quite some time that healthcare providers are reluctant to collect money at the time of service for fear of offending their patients. They've taken advantage of these fears by implementing higher and higher co-pay, coinsurance and deductible amounts . You may be inclined to believe that these higher amounts would have more of an adverse effect on the medical insurance companies than they would the physicians. After all, you might reason, insurance companies don't want to offend their members any more than the physicians want to offend their patients. So why, then, would a medical insurance company want to keep these co-pay, coinsurance and deductible payments so high for their members?

Simple. Medical insurance companies know that because healthcare providers won't collect money at the time of service they'll opt to send out statements instead. These statements have the provider's name and address splattered all over these bills, thereby creating the perception that the provider is the one charging all the money, not the medical insurance companies. Think about it.

These high co-pay, coinsurance and deductible strategies also create a situation where insurance companies pay almost nothing for various types of claims. Let's say, for example, that the "allowed amount" or the contracted rate for an office visit is $45.00. By raising the member's co-payment amount to $45.00 the insurance company pays absolutely nothing while the members pay it all. Medical insurance companies bank on the provider's poor collection strategies which they know will result in free services for their members. Pretty devious, wouldn't you say?!

To DOUBLE your CASHFLOW you must tactfully, yet aggressively, collect co-payments and all outstanding balances AT THE TIME OF SERVICE. The most effective way to collect money at the time of service is:

  • Make it as easy as possible for patients to pay all outstanding balances.
  • Tell patients in advance that they are expected to pay all outstanding balances at the time of service. 
  • Make sure all payment policies are posted on the waiting room wall and in the office, along with being printed on various patient forms that require the patient's signature.
  • Post a notice that you will charge a billing fee if you have to send out a bill for a co-payment.

After we too were swindled out of thousands upon tens of thousands of dollars for multiple medical management software packages and billing franchises, we found that ONLY ONE billing system will do EXACTLY what it is has been designed to do. Click here to find out more