Advice on Handling Cash Payments
Medical practices are noticing an increase of patients paying cash for services and products. Some of the reasons we are seeing a shift is because of higher deductibles, larger copays, non-covered services, and more retail sales in the office.
Hopefully, everyone recognizes that collecting patient payments can be as important as collecting payments from insurance companies. Creating a process to collect and manage these cash payments will assist medical practices in bringing in revenue. Here are five suggestions:
Collect Payment in Advance
We recommend collecting patient payments prior to the services being rendered. The front desk staff needs to understand the importance of collecting payments at the time the patient is in the office. A substantial percentage of the revenue accumulated by a medical practice is the patient responsibility portion. This fact should not be taken lightly. Payments made on the day of service is the quickest way to increase cash flow and lower patient AR. This will result in keeping costs down for everyone.
Create a Process
There is an extensive amount of diverse insurance plans. It has become problematic to predict what the insurance company will cover these days. Many new procedures are being considered experimental, leaving the patient responsible for the payment. Often charges are too high for patients to pay in full which then requires a payment plan. We advise designating a person to oversee creating and implementing these plans. It is also essential to monitor the patient AR to avoid losing valuable income.
Keep a Log of Services
Try keeping a log for procedures that are covered and not covered by the various insurance plans. This will help the patient understand their responsibility before being treated. We advocate collecting payment for any uncovered procedure at the time of service. It is more difficult to collect payment from a patient after services have been performed.
Post Procedure Price List
Patients need to be educated about their responsibilities upon their arrival. They should expect to be asked to pay their copay or portion of the bill. We urge physicians to make the prices for your most common procedures readily available to your patients. Creating a hand out and posting the pricelist in the reception area will help clarify out of pocket expenses if the service goes to the deductible or is not covered. The patient will be less likely to have questions, saving the physician time and money.
Taking deposits for items, procedures, and tests that may not be covered is something we suggest to all our clients. Many DME items get denied. Having the deposit is a good indication that the patient will return to pick up their item and pay the balance. If a deposit is taken for a procedure that is not covered the patient will be billed the balance once the insurance company denies the procedure. A portion of this balance has been taken at the time of service which means less money needs to be collected and chased after. If insurance pays, the patient can easily be refunded.
Providers must stay on top of collecting cash payments when they are due, to avoid getting into the collection stage of the revenue cycle. If you collect payments accurately and early in the collection process you will be on track to increasing your Vital Profits!