4 Best Practices for Collecting Out-of-Pocket Patient Fees

by Phil C. Solomon on January 22, 2013

in Collecting self pay deductibles and co pays

Phil C. Solomon – The author sent me this post and asked if I would post it on my site. After reading it, I felt the author made some really strong points.  The content of this post is aimed at medical practices, however the strategies for collecting patient fees and self pay balances in hospitals are the same. The most important key to collecting patient fees, regardless of the industry segment…. you have to ask for the cash!

Patient fees4 Best Practices for Collecting Out-of-Pocket Patient Fees

One of the most important aspects of a medical practice’s success is collecting the money that a patient owes them. This seems like a “no-brainer,” right? Well that does not necessarily make it an easy feat. Patient out-of-pocket fees account for 30 percent of a practice’s revenue, yet once a patient walks out the door, chances of collecting that money are practically cut in half.

The bright side is that there are ways to improve the collections process in order to ensure payment efficiency. After speaking with practice management consultants, we found four strategies to improve patient fee collection while maintaining strong customer satisfaction.

1. Train Your Team
The office manager may handle claims, but the entire staff should still know insurance policies and procedures. A good way to do this is to train employees on their own benefits. That way they can see it from both perspectives.

Your staff should also be trained on how to ask for money from patients. Requesting payments can be tricky. A good method is to have a script of exactly what to say. For instance, instead of saying “you owe 30 dollars,” a staff member could ask “cash, check or charge?” This less confrontational approach lowers the chances of a patient being turned off.

2. Educate Your Patients
A patient should never be blind-sided by costs. It’s best to be as upfront as possible. This is particularly applicable for patients who have a high deductible or are self-pay. For these patients, try and talk with them before they arrive for their appointment. If your practice offers a discount for patients who pay large amounts on the spot, then discuss this opportunity with them before the time of payment. This makes patients more comfortable about paying a larger amount of the bill.

3. Automate the Collections Process
This is the 21st century. It’s time to accept credit cards. You pay a higher fee for credit card payments, but more patients are willing to pay this way. Ask your patients to keep their credit card information on file. With their permission, you can automate payments of an agreed upon amount.

Starting in January 2013, the Affordable Care Act will require practices to automate patient eligibility too. This should dramatically decrease issues in accounts receivable because patients will know their financial responsibility within 20 seconds.

4. Be Professional About Balances
In the age of information, there should be a record of everything. There should be something in writing for the sake of your practice and your patients. If you decide to accept installments on a balance, have the patient sign a promissory agreement. If you don’t keep it professional, they won’t either.

No matter which of these methods work best for you, be sure to keep the purpose of each one in mind. Communicate your expectations clearly to your staff and patients to make sure there’s an understanding on the how, when and what of out-of-pocket fees.

For more on the topic, drop by Software Advice’s website and check out the original post on the Profitable Practice blog.

Phil C. Solomon is a healthcare finance and revenue cycle sales consultant and marketing strategist with experience spanning two decades. Phil has expertise in the areas of healthcare technology and business process outsourcing (BPO). He is the publisher of Revenue Cycle News, a healthcare revenue cycle blog and is a featured speaker at many HFMANAHAM and AAHAM healthcare educational conferences.


{ 2 comments… read them below or add one }

Paula Z January 29, 2013 at 2:06 PM

It may be a small thing, but using Office Manager as title may come across as a put down. These days, the folks I work with are Practice Managers. Having responsibility for revenue cycle comes requires a bit of credibility and the title should go with it. Great article, but worry you may turn some off.


Phil C. Solomon Phil C. Solomon January 29, 2013 at 7:27 PM

Hello Paula:

Thank you for your comment. It is not easy to run a complex medical practice. Those who run practices should be commended and given the respect they deserve… along with an appropriate title.


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