Sharing The Practice Management Love Part 5: Patient Collections

Patient collections… this is the area I least like to talk about, yet it seems to drive most of my conversations in the office. I hate with a passion this aspect of running a medical practice.

I’m the first to say we have to run the practice like a business, but when we are dealing with children and trying to provide care for them, it makes it more difficult to deal with collection issues. It has become more critical as CB023964people continue to buy high deductible, less expensive health insurance policies. And insurance companies are now saying to providers, you are not getting money from us now… you’ll have to go after the patient if you want to get paid for your services; which make matters worse. Consequently, and very unfortunate, in addition to being health care providers, we are now health care collectors as well.

Nonetheless, it is an issue that we have to address. Therefore, we’ve taken time to develop – what I think – is a comprehensive patient collections protocol. Below are the six areas we focus on to ensure we effectively collect patient balances.

We created an financial/office policy

I’ve talked about creating an office policy before. You can check it out here. The financial/office policy lays out the blue print for your patients in terms of expectations. The policy informs parents what is expected of them concerning financial matters. A financial/office policy will not only let parents know what are the conditions by which our practice provides services, but it also helps us enforce our patient collection policy.

We created a collections protocol

I’ve also talked at length about the importance of having a collections policy. This type of policy lays out another blue print for the entire office in terms of how the staff attempts to collect on accounts that are past due. As result of our collection efforts, I’m happy to share (brag) that our percent of accounts receivable greater than 90 days is less than the average for our type of practice. Read more about our collection policy here to see how we implement this process here.

We hand parents statements when they check in

Handing parents their children’s statement is a good habit. Again, it sets expectations. If the balance is past due, most parents already know because they got the statement in the mail. Parents also know that payment is expected at the time of service (per our office policy), so handing them their statement is a way to gently enforce our office’s policy.

How many times have you heard a patient say, “I never got a statement in the mail” or “I wasn’t aware of the balance?” Probably a million times. We try to minimize the chances of hearing these responses by physically handing parents their children’s balance. We also make sure we have the correct address and determine why they haven’t received it, but we still hand them the statement for good measure.

If they say they didn’t know they had a balance because they never got the statement, then we tell them, “well, since you didn’t get the statement that we mailed out on the first of the month (like we do every month) I’m giving it to you personally today.”

Some do get offended. People don’t like to be reminded they owe money. But how else would we advise parents they have a balance if it is not with a statement? I often ask parents that get upset when we hand them their statements, how else would you like for us to inform them of their balance considering you didn’t get the one we sent in the mail? Until they can come up with a better way, we will continue to hand them their statements.

By the way, we keep on mailing statements, but this is just something extra we do. I figure, the parent is at our office already, they have a balance, why not try to collect payment? Once they leave the office, we are at their mercy. Once they leave, we have no recourse but to hope they send payment in.

We make it easier for patients to pay us.

I’m not talking about a credit card machine in the office. I’m talking about the ability to pay online. We use PayPal and it has worked out well. If parents have a PayPal account, it is easier for them because all they have to do is log on, and pay the way they normally pay anything else online. If they don’t have a PayPal account, it doesn’t matter. What I like about PayPal is that you don’t have to open up an account to use the service. Just pay online using a secure online form. The benefit for the parent is that they don’t have the hassle of writing a check and mailing it. The benefit to us is that we don’ t have to wait for a check to arrive, and then turn around and deposit it.

We get an email confirmation of the transaction and so does the parent. PayPal provides reports and several other services that help us manage the payments. PayPal does charge a transaction fee, just like any other merchant account and there are certain rules and terms. Check it out and see if it is something that may be beneficial to your practice.

Another non-collection related benefit of having online payment is the bump in web traffic on our practice’s site. By giving parents a reason to visit our practice’s website, we can leverage the platform to communicate with patients. If we want to update patients on the expanded hours or that we are scheduling school physicals or we have a new doctor, the website can help us communicate that to our parent.

We created an Easy Pay Program

A couple of years ago, we implemented a program called the EPP (Easy Payment Program, clever isn’t it?). The program is very simple to apply and has worked well for us. Here is how it works: when a parent has a balance and is unable (or unwilling) to pay in full, they leave a credit card on file with us so we can arrange a payment plan. We agree on the date, the amount and frequency of the charges (monthly, biweekly, etc.) and the parents signs a form outlining the terms of our agreement. We then process payment per the terms. We don’t charge a fee or interest and we work with patients to have them pay off the balances within a three to four month period.

Before we implemented the EPP, we sent out coupons or made a verbal arrangements with parents. It didn’t work because parents would forget to mail payments in. The credit card on file ensures we are going to be paid in-full for our services.

When I look at my patient account receivable reports, it is nice to know for the most part we have payment guarantees for those balances. I also think it is a good compromise when discussing with parents patient balances.

We attend seminars

Our office is a big believer in seminars, conferences, workshops and events that help us run our business better. Last year, I attended an account receivable collections seminar hosted by the people at Not only did I send our collector, but I also sent my front desk staff. Sending our front desk staff to the workshop turned out to be a great decision. Since the seminar, we’ve been able to create synergies among our collectors and front desk. After all, the front desk probably has better chance to collect. Why not give them the tools and knowledge to collect?

You can find out more of my thoughts on attending seminars by going here.

Well, I think this concludes my “Sharing the Practice Management Love” series. If you like the info, and want to hear more stuff like this, let me know. If you didn’t like it, don’t be shy and let me have it. Either way I love hearing back.


1 thought on “Sharing The Practice Management Love Part 5: Patient Collections”

Comments are closed.