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Avoid these five reasons that front-desk collections fail
With the number of patients who have high-deductible health plans that are climbing even higher, many practices are moving toward an up-front, point-of-service collections model. Our firm has advocated this for decades. When front-desk collections are implemented correctly, we see significant increases in daily revenue and a reduction in accounts receivable of more than 90 days old.
However, when implementation is not executed well, we find that the initiative often fails, and staff returns to collecting copays and telling patients they’ll be billed after insurance pays.
Here are five common reasons for front-desk collection failure, and how to avoid them:
1. Vague rules, no procedures
The amount to collect varies by payor and patient type, benefit level and service provided. If you don’t provide staff with granular rules about what to collect from each type of patient, don’t be surprised if they don’t ask for payment at all.
Create clear rules and procedures. First, define the amount collected and how it varies whether a patient is covered by a contracted plan vs. Medicare vs. out of network vs. uninsured vs. has a high-deductible health plan. All the amounts in these situations could be different.
Next, create step-by-step procedures for how staff may arrange for payment plans, offer patient financing or handle cash discounts, and what to do when patients say they can’t pay. It’s paramount that staff is equipped with a protocol for handling patients who have a financial hardship. Define qualification criteria — we suggest basing this on the U.S. Poverty Guidelines (updated annually at aspe.hhs.gov/poverty) — and develop a written procedure staff can follow.
2. Rules vary by surgeon
It’s an unrealistic expectation that staff follow a different set of rules for each surgeon. If you allow this or enable the rogue surgeon, you are setting your collections effort up for failure. When it’s tough to remember different rules, staff simply won’t collect. The fix? Develop one standard collection policy for all surgeons.
3. Staff isn’t given the right tools
Imagine you’re a carpenter about to build a custom dining table. If you leave your hammer at home and the wood you ordered won’t be delivered until tomorrow, can you build a table? Nope.
When practices fail to provide staff with right tools, whether software tools or data, it’s like asking staff to build a table without a hammer and wood.
Start simply. For example, provide staff with past-due balances and eligibility status for every patient coming in for an appointment each day. These reports (generated from your system or the clearinghouse) typically indicate amounts owed, unmet deductibles and the ineligible patients they can collect from. Create a spreadsheet of the most common office services, such as injections, X-rays and DME, and enter the payment schedule for your top five payers to 10 payers. Calculating the percentage owed based on patient benefits is easier when the data is front and center.
Then, move toward electronic tools. Offering an automated recurring payment option lets staff establish a payment plan before the patient leaves the office. The payments are then automatically billed on a credit card; no staff intervention needed. Or, offer the option of patient financing — which patients can apply for using a tablet or other device — to finance large deductibles and coinsurances. For a small fee, the patient receivable is off your books and money is your bank in 2 business days. CareCredit (carecredit.com) is one option.
4. Collections training is an afterthought
Just because someone can collect copays does not mean he or she is comfortable or capable of asking patients for large dollar amounts or past-due amounts. It’s the rare staff person who is a “natural” at this. Without training, we watch many staff avoid eye contact and refrain from asking the patient to pay.
Address this by developing talking points and scenarios for collecting past-due balances and handling objections. Create scripts that explain payment plan options and how to apply for patient financing or financial assistance.
Then, monitor and coach performance. Conduct role-playing during staff meetings, ask staff to read scripts aloud to verify that everyone is accurately following rules and procedures. An outside trainer or coach can be beneficial in evaluating and improving staff’s service skills, body language and collection effectiveness.
5. The surgeons took their eyes off the ball
The Hawthorne Effect is a psychological phenomenon that says people perform better and make more positive changes as a result of increased attention. In other words, staff will perform better and collect more, if they know someone is paying attention.
Monitor collections performance monthly. Conduct occasional, end-of-day check-ins to inquire about the amount collected. Review daily over-the-counter collection amounts and always put front-desk collections performance on the monthly partner meeting agenda. As the old adage goes, employees will respect what management inspects.
Karen Zupko is president of KarenZupko & Associates Inc, a consulting and education firm that has been advising physicians to succeed in the business of medicine for more than 30 years. An internationally recognized thought leader and speaker Karen advises physicians and health care managers about the challenges and trends impacting the practice of medicine. Her pragmatic, action-oriented style inspires people to apply common sense and business rigor to improve profitability, efficiency and patient satisfaction.