Improving Patient Collections: Best Practices [2024]

Want to boost your medical practice's bottom line? Improving patient collections is key. This guide will break down effective strategies to streamline your collection process and patient payment processes.

Let's start with the best ways to improve patient collections:

1. Be upfront about costs
2. Offer multiple payment options
3. Train staff to handle money talks
4. Use software for billing and reminders
5. Provide financial counseling

Why it matters:

• Patients are paying more out-of-pocket
• High-deductible plans are common
• Confusing medical codes and terminology on bills

Improving your patient collection process doesn't have to be complicated. By focusing on a few key strategies, you can boost your bottom line while keeping patients happy.

Clear communication is the foundation. When patients understand their bills and responsibilities, they're more likely to pay on time. It's that simple.

Offering flexible payment options is a game-changer. Whether it's payment plans or digital wallets, making it easier for patients to pay means you'll get paid faster.

Don't overlook your staff. With the right training, they can confidently discuss financial matters and collect payments upfront. This small step can make a big difference.

Technology is your friend here. The right tools can streamline billing, reduce errors, and even automate follow-ups. Less hassle for you, less confusion for patients.

Lastly, consider offering financial counseling. Helping patients plan for their healthcare costs builds trust and can lead to better collection rates down the line.

By implementing these strategies, you're not just improving collections – you're enhancing the overall patient experience.

Bottom line: Better collections = healthier finances for your practice.

Quick tips:

• Collect copays at check-in
• Offer payment plans for big bills
• Keep up with new payment tech

Remember: Set clear expectations early. Patients who know what they owe are more likely to pay.

The patient's financial journey

The patient's financial journey in healthcare isn't just about paying bills. It's a whole process that starts before you even step into the doctor's office and continues long after you've left.

Before service: Financial counseling

Think of financial counseling as a sneak peek at your healthcare costs. It's like getting the menu before you order at a restaurant. Here's why it's a big deal:

• You know what you're getting into, money-wise
• No nasty surprises when the bill comes
• You can plan your budget better

During service: Collecting payments

Paying at the time of service? It's not just convenient for you - it's a win-win. Here's the scoop:

• Healthcare providers get paid faster
• Less paperwork and follow-up needed
• You're more likely to pay when the service is fresh in your mind

After service: Billing and follow-up

The billing process can be challenging for medical practices. Here's how to improve it:

• Quick invoices keep patients happy
• Friendly reminders help patients remember to pay
• Offering multiple ways to pay increases your chances of getting paid

A large percentage of patients don't pay their full medical bills. Some studies have found that 41% of adults currently have some debt caused by medical bills. This shows why having a good billing process is so important.

By focusing on these basics, practices can collect more while keeping good relationships with patients. Clear, timely communication and easy payment options benefit both the practice and patients.

A smooth billing system isn't just about making more money—it's about making things easier for your patients too.

Best ways to improve patient collections

Let's look at some proven methods to boost your patient collections. These aren't just theories - they work in the real world.

Clear and open communication

Talking about money can be awkward, but it's necessary. Here's how to do it:

• Strive to tell patients what they owe before treatment, even if its an estimate. No surprises!
• Explain costs in simple terms. Skip the medical jargon.
• Give patients a rough estimate of what they'll need to pay.

Simpler billing processes

Make your billing smooth:

• Use efficient systems to avoid errors and delays.
• Submit claims promptly to speed up the process.
• Design bills that are easy to read and understand.

Offering different payment options

One size doesn't fit all when it comes to patient payments. To boost your collection rates, offer a variety of payment options.

• Credit cards are quick and easy for many patients.
• Online payments cater to those who prefer handling bills from their computer.
• Payment plans can be a lifesaver for patients who can't pay in full right away.
• Don't forget mobile payments - they're perfect for busy patients who manage everything from their phones.

By providing these choices, you make it easier for patients to pay in a way that works best for them. This flexibility can lead to faster payments and happier patients overall.

Early financial counseling

Don't wait until after treatment to talk money. Start early:

• Chat about costs before the appointment.
• Help patients understand their insurance coverage.
• Let them know about financial aid options.

Using helpful technology

Patient payment software can help improve collections:

• Let patients view and pay bills online.
• Send friendly reminders about upcoming payments.
• Use stats to spot trends and improve your process.

Training and supporting staff

To boost patient collections, you need to train your staff well. Let's focus on two key areas:

Teaching communication skills

Good communication is crucial for patient collections. Here's how to help your staff talk about money:

• Practice tough conversations through role-play
• Use active listening to understand patient concerns
• Explain bills in simple terms

Most patients want to discuss out-of-pocket costs with their doctors:

• 63% of patients want to talk about their costs
• 79% of doctors think patients want to discuss costs

However, these conversations rarely happen:

• Only 35% of doctors say they've had these discussions
• Just 15% of patients report having talked about their costs

This shows a big gap between what patients and doctors want and what actually occurs in practice. There's a clear need for more open communication about healthcare costs during patient visits.

Learning about financial policies

Your staff should know your financial policies and procedures inside out.

1. Start by covering insurance types. This helps them explain coverage to patients accurately.
2. Next, focus on copays and deductibles. Understanding these allows staff to collect the right amount upfront.
3. Don't forget about payment plans. These offer options for patients who can't pay in full.
4. Lastly, educate your team on financial aid. This ensures they can show patients all their choices.
5. When your staff is well-versed in these topics, they can better serve patients and improve your practice's financial health.

Improving collections at time of service

Want better cash flow? Collect payments when patients get care. Here's how:

Boost collections during visits

1. Check insurance before appointments
2. Ask for copays at check-in
3. Offer multiple payment options
4. Use patient estimation tools

Prep your front-desk team

Your front desk is key. Help them succeed:

• Train them to talk money with care
• Give them scripts for tough chats
• Teach them to use payment tech

Following up after service

Don't let unpaid balances slip through the cracks. A solid follow-up plan is crucial for keeping your practice's finances healthy.

Effective follow-up strategy

Start your follow-up as soon as you know what the patient owes. Aim to wrap up collections within 90 days. Here's a simple plan:

• Plan to send three statements, spaced out over time
• Send a collections notice at 70-75 days

• Add a quick "nudge" 3-5 days after the final notice

• Always include clear due dates on your statements. And stick to what you say you'll do.

Use your practice management system to automate as much as possible. It can track bills, add late fees, and flag patients who are behind.

Mix up your contact methods

Don't just rely on snail mail. Try these:

1. Phone calls (before sending written notices)
2. Emails with payment links
3. Text message reminders
4. Online payments through your patient portal

Pro tip: Create template letters for common situations to save time.

Always document your follow-up efforts. Note who you talked to, when, and what was said. This info can be a lifesaver if you need to re-file claims or check eligibility later.

Checking and improving performance

Want to boost your patient collections? Keep an eye on these key numbers:

1. Days in Accounts Receivable (A/R): How long it takes to get paid. Aim for 30-40 days, max 50.
2. Clean Claims Rate: Claims paid on first try. Shoot for above 90%.
3. Net Collection Rate: What you collect vs. what you're owed. Get close to 100%.
4. Bad Debt Rate: Keep under 5% of total charges.
5. Point-of-Service (POS) Collection Rate: How much you collect at time of service.

To step up your game:

1. Check numbers daily, weekly, and monthly
2. Use your practice management system to flag late payments
3. Find and fix common denial issues
4. Train staff to collect at time of service
5. Offer online payment options

Solving common collection problems

Let's tackle two big issues healthcare providers face with patient collections:

1. Helping patients who can't pay

Many Americans struggle with medical debt. Here's how to help:

Offer financial assistance programs

• Provide discounts for eligible patients
• Allow a generous application window
• Consider automatic discounts for uninsured patients on necessary services

Set up payment plans

• Offer no- or low-interest options
• Accept small monthly payments
• Be flexible with payment timelines

Connect patients with resources

• Partner with organizations to check government assistance eligibility
• Help patients apply for Medicaid or Social Security Disability

2. Managing high-deductible plans

High-deductible health plans (HDHPs) affect many Americans with employer-based insurance. To handle HDHPs:

• Check benefits before appointments
• Set clear expectations about payment policies
• Collect co-insurance and deductibles upfront
• Encourage Health Savings Accounts (HSAs)
• Ask about HSAs when verifying insurance information
• Remind patients to bring their HSA debit card to appointments
• Stay in touch with HDHP patients
• Keep patients engaged to ensure they get necessary preventive care
• Be aware that some patients might avoid care due to costs

By addressing these common issues proactively, you can improve both patient satisfaction and your practice's financial health while ensuring patients receive necessary care.

Future of patient collections

Healthcare is changing fast. So are patient collections. Here's what's coming:

New technologies

AI and machine learning are changing how providers handle payments:

• AI predicts denials: Spots claims likely to be rejected before submission.
• Auto financial screening: Checks eligibility for financial help without manual work.
• Smart payment plans: Uses patient data to offer personalized options.

Patient preferences shift

Patients want a more consumer-like payment experience:

• Digital-first: 79% want to pay all medical bills from a single digital platform (Healthcare In The Digital Age).
• Contactless: Gen Z is embracing simple, seamless payment options.
• Upfront estimates: No Surprises Act requires good-faith cost estimates.
• Flexible options: Patients want online portals, text-to-pay, digital wallets, and auto-payments.

To keep up, providers should:

1. Offer payment choices From old-school to new digital methods.
2. Use price transparency tools Help patients know costs upfront.
3. Apply engagement intelligence Millennia's tools tailor communication and payment strategies to each patients
4. Integrate systems New tech should work with EMR and EHR systems.

With more than 50% of private-sector workers in high-deductible plans, these changes will shape collections. Providers who adapt fast will boost their finances and keep patients happy.

Conclusion

Effective patient collections are vital for the financial health of your medical practice. To optimize this crucial aspect:

1. Prioritize transparency: Communicate costs clearly and early, using easily understood language in all billing materials.
2. Embrace technology: Implement modern billing systems and automated reminders to streamline processes and reduce errors.
3. Offer diverse payment options: Cater to patient preferences by providing multiple ways to pay, including electronic methods.
4. Invest in staff training: Equip your front desk team with the skills to confidently discuss financial matters with patients.
5. Provide financial counseling: Help patients understand and plan for their healthcare costs before treatment begins.

Remember, successful patient collections are about more than just securing payments—they're about building trust and fostering positive relationships with your patients. By implementing these strategies, you're not only improving your practice's financial stability but also enhancing the overall patient experience.

Stay proactive in your approach:

• Regularly analyze key performance indicators
• Seek patient feedback on your billing processes
• Stay informed about emerging payment technologies
• Be willing to adapt your strategies as needed

In today's evolving healthcare landscape, the practices that thrive are those that view patient collections as an opportunity for engagement rather than a mere transaction. By setting clear expectations, offering support, and leveraging the right tools, you can create a win-win situation where patients feel valued and your practice remains financially robust.

Ultimately, effective patient collections are about striking the right balance between compassionate care and sound business practices. With the right approach, you can achieve both, ensuring the long-term success of your practice and the continued health of your patients.