Many factors brought on by healthcare reform are affecting patient collections—new health exchange plans, newly insured individuals, more high-deductible plans, increased patient co-insurance responsibilities, and higher co-pays. Medical practices and their staff must become more diligent in patient collections to maintain healthy bottom lines. PYA Consulting Principal Lori Foley recently presented “Surviving the Changing World of Patient Collections” during the Business of Medicine Program at Kennesaw State University.

1. Surviving the Changing World
of Patient Collections
Presented to:
WellStar Business of Medicine Program
February 1, 2014
Presented by:
Lori A. Foley, CMA, PHR, CMM
www.pyapc.com
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February 1, 2014
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2. Objectives
Understand how recent changes in
healthcare reimbursement affect the
practice bottom line.
Describe how you can best equip
yourself in the current environment to
maintain high collection percentages
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3. Recent Changes that Affect
Patient Collections
• New health exchange plans
– Platinum, Gold, Silver, Bronze
– Greater liability regarding patient
responsibility if plan is subsidized
• Newly insured individuals
– Patients that have been previously uninsured may not understand the
provisions of their plan or how
insurance works in general
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4. Recent Changes that Affect
Patient Collections
• More high-deductible plans
Many patients have plans with $5,000$7,500 deductibles
• Increased patient co-insurance
responsibilities
Patient co-insurance responsibility (after
deductible) ranges from 20%-30% in
most cases.
• Higher co-pays
Average copays range from $40 to $75.
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5. Overall Impact in Georgia
• As of December 28th, approximately 58,000 people had
enrolled in a plan through the exchange. However, others
may have selected to apply directly with payers if they were
not eligible for a subsidy.
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6. Overall Impact in Georgia
• As of December 28th, approximately 58,000 people had
enrolled in a plan through the exchange.
• The enrollment deadline was extended to March 31, 2014.
• Existing insurance benefits are changing overall to absorb
the cost of expanding coverage.
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7. Overall Impact on Practices
• Practices must be more diligent in patient collections to
maintain a healthy bottom line.
• Insurance verification is more important now than ever.
Practices risk a significant portion of revenue by not doing so.
• Patients and staff must be educated on the variety and
complexity of plans.
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8. Overall Impact on Staff
• Front-line employees must be comfortable requesting money
from patients while maintaining a professional demeanor.
Having the right people in these positions will be critical to the
bottom line.
• Depending on the practice specialty and resources,
insurance verification may require more staff time.
• More staff time may be required on the back-end to follow up
and collect patient balances.
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9. First Point of Contact
Front office employees are typically the first point of contact for patients.
This role is very important as this sets the tone for the patient/practice
relationship and is the starting point for the billing cycle.
POINT OF
CONTACT
If patient demographics are not correctly entered, this delays the
entire collections cycle.
If practice financial policies are not enforced, patients will take notice
and may become more “relaxed” in their payments to the practice.
It is important to be welcoming and pleasant while also being firm on
policies.
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February 1, 2014
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10. Best Practice – Verify Insurance
• Verify insurance – no more than 2 days prior to appointment
per new ACA guidelines. Maintain evidence of verification.
• Obtain pre-authorizations prior to appointment date. Know
what procedures/services need authorizations.
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February 1, 2014
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11. Recent Changes that Affect
Patient Collections
• New health exchange plans
– Platinum, Gold, Silver, Bronze
– Greater liability regarding patient responsibility if plan is
subsidized
• Newly insured individuals
– Patients that have been previously un-insured may not
understand the provisions of their plan or how insurance
works in general
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February 1, 2014
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12. Establish Practice Policies
• Obtain demographics and medical insurance information at
time of appointment scheduling to include phone number for
verification.
• Nature of visit is also important for insurance verification
• Detailed verification of insurance and benefits will be
required. The practice should investigate potential resources
such as PMS add-ins; 3rd party vendors (Availity, Freesia,
etc.); registration at payer sites.
• Patient should be contacted if anticipated services will not be
covered or subject to co-insurance. All expected amounts
should be communicated to patient PRIOR to appointment.
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13. Establish Practice Policies
• All notes in the patients’ profile must be reviewed and
addressed by the front office. Individuals responsible for
appointment reminders and check-in/out must review
patients’ information prior to contact and be prepared to
address any issues.
• Comments should be cleared from patient profile once issues
are resolved to eliminate “noise” in the profile.
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February 1, 2014
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14. Best Practice – Time of
Service Collections
• Collect cash and co-payments and any portion of patient
balances at time of service.
• Estimate patient responsibility for self-pay patients and
require payment prior to being seen.
• Understand what is considered Preventative Care (covered at
100%).
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February 1, 2014
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15. Maximize Collections
Co-pay
$40
Total Visits/Month
(30 pts/day x 22
Insured
days)
Visits/Month
% Insured
Monthly Copay Quarterly
$
Copay $
Annual Copay
$
5%
660
33
$1,320
$3,960
$15,840
10%
660
66
$2,640
$7,920
$31,680
15%
660
99
$3,960
$11,880
$47,520
20%
660
132
$5,280
$15,840
$63,360
25%
660
165
$6,600
$19,800
$79,200
30%
660
198
$7,920
$23,760
$95,040
35%
660
231
$9,240
$27,720
$110,880
40%
660
264
$10,560
$31,680
$126,720
45%
660
297
$11,880
$35,640
$142,560
50%
660
330
$13,200
$39,600
$158,400
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February 1, 2014
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16. Maximize Collections
Average Patient
Responsibility
% Insured
$1,500
Total Visits/month
eligible for
deductible (5
Insured
pts/day x 22 days) Visits/Month
5%
110
10%
110
15%
110
20%
110
25%
110
30%
110
35%
110
40%
110
45%
110
50%
110
Monthly
Quarterly
Annual Deductible
Deductible $
Deductible $
$
6
$8,250
$24,750
$99,000
11
$16,500
$49,500
$198,000
17
$24,750
$74,250
$297,000
22
$33,000
$99,000
$396,000
28
$41,250
$123,750
$495,000
33
$49,500
$148,500
$594,000
39
$57,750
$173,250
$693,000
44
$66,000
$198,000
$792,000
50
$74,250
$222,750
$891,000
55
$82,500
$247,500
$990,000
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February 1, 2014
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17. Odds of Collecting
After Date of Service
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18. Establish Practice Policies
• Collect all balances at check-in
• Collect deposit or estimated amounts for patients with
coinsurance/deductibles. Settle-up may be completed at
check-out
• Unless emergent, patients should not be seen if balance is
not paid
• Fees for no show appointments, forms, etc.
• Self-pay discount
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February 1, 2014
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19. Establish Practice Policies
• *Require deposit or balance in full prior to procedures
whenever possible. Patient responsible amounts may be
separated in 2-3 installments:
1st installment at time of scheduling
2nd (final) installment at pre-op
3rd installment (for high amounts) due within 2 weeks
following procedure
*Recent research has shown that some carriers are now advising patients not to pay
prior to insurance claim processing (BCBS, CIGNA).
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February 1, 2014
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20. Establish Practice Policies
• If patients object to payment in advance due to carrier policy, advise them
of the estimated amount due and obtain their signature on a promissory
note. Employees should attempt to obtain a credit card number for future
billing at this time as well.
• Employees will need to review EOB’s once payment is received and
contact the patient regarding actual amount due. They should inform the
patient that their card will be billed at this time and a receipt will be mailed
to them.
• If no card is on file, the patient should be notified that payment is due
immediately.
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February 1, 2014
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21. Offer Convenient Payment Solutions
• Accept all forms of payment
• Convert checks to debit
• External financing
• Online payments
• Automatic payments
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February 1, 2014
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22. Best Practice – Patient Billing
• The patient collections cycle should be defined.
• Generally, patients should receive no more than 4 statements
prior to being sent to collections.
• Patient statements should not show the collections timeline
(i.e., 0-30 day, 31-60 days buckets). This falsely indicates
that the patient has several more cycles before they must
pay. Alternatively, statements should have a payment due
date.
• Patients with accounts in collections should not be scheduled
for an appointment prior to balances being paid in full.
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23. Best Practice – Patient Billing
• The practice should set parameters within
the billing system to generate patient
statements at the time a patient responsible
balance is created after insurance payment
posting. Not doing so could significantly
delay payment.
• Once statements are generated, they
should follow the normal statement cycle of
the practice (i.e., statement every 30 days).
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24. Establish Practice Policies
• Set parameters of payment plans:
No more than three installments for balances under x
dollars
No more than four installments for balances under y dollars
Only allow payment plans for emergent or costly
procedures. Otherwise, patients should be instructed to
pay prior to procedure/visit.
Practice should generally not allow more than six
installments.
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25. Establish Practice Policies
Staff must consistently monitor
payment plans. Establishing them
and not enforcing is not effective.
Patients should be contacted
within 1-2 days of missing a
scheduled payment. This will
reinforce to the patient that the
practice is monitoring and will hold
them to the terms of the
established plan.
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26. Set Patient Expectations
• Post policies in office and communicate directly with patients.
• Remind patients of past due balances prior to appointments
(utilize notes within system).
• Consistently enforce policies.
• Limit physician involvement.
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27. Educate Staff
• Prepare a listing of all plan products and practice status to
better inform staff. Advise patients at the time of registration
of practice’s status with plan--participating, not participating,
in process.
• Employees must understand how to identify plans, especially
with the addition of exchange plans. Most have an X in the
identification number or have the metallic name as a part of
plan name.
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28. Educate Staff
• Ensure all employees are aware of policies.
• Advise them of tools available to them (manuals,
websites, cheat sheets, etc.).
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29. Monitor Data Entry
• Garbage in = Garbage out:
- Ensure staff are trained on important patient data fields.
- Monitor data entry errors.
- Use a claim scrubber.
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30. Monitor and Communicate
• Communicate problems with management.
• Staff should share complex cases with each
other so that experience is gained.
• Monitor compliance with established policies
and effectiveness.
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31. Contact Information
Lori A. Foley, CMA, PHR, CMM
Principal
lfoley@pyapc.com
Pershing Yoakley & Associates, P.C.
(404) 266-9876
www.pyapc.com
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