I don’t know of any other business where a person buys a product (or service), and walks out the door without giving some sort of financial commitment.
If you think about it, only doctor offices and financial institutions allow this. But here is the kicker. Financial institutions asses a person’s creditworthiness before they lend anybody any money. When a doctor provides medical care, they are extending the patient credit just like a financial institution does but without a guarantee.
Oh yeah, I forgot; we check the patient’s insurance and some spend hours on the futile task that is insurance eligibility. But let’s be honest. Flashing an insurance card doesn’t guarantee anything. Why not spend the same time on something that offers a better guarantee?
So what do we do?
For private medical practices, I don’t think it is unreasonable to ask patients for a payment guarantee. This can be done several ways. For example, the doc could ask for a down payment or an upfront deposit. Another solution is to keep the patient’s credit card on file and process the card should the patient become delinquent. Or, like the hotel industry, providers could put a “hold” on the credit card just in case insurance doesn’t go through.
I can hear some people say “… oh, that would never work in my office.” “Patients will leave and go to the practice down the street.”
We thought that too. But there really wasn’t any practical evidence that we would have a mass exodus. Nobody that we knew of had tried it before; so there really was only one way of finding out.
After much thought and deliberation, we decided to require parents to leave a credit card on file in order to be seen by one of our physician. There are some exceptions and rules we follow, but other than those exceptions, all patients must leave a card on file if they wish for us to continue providing medical care.
The downside? A handful of patients left. The upside? Our A/R dropped drastically. Now, instead of being health care collectors, we are now able to go back to being health care providers. Not to mention, we were able to provide the best care possible to those that truly value our service and understand that we have to get paid for what we do.
I really wish more practices would start requiring patients for payment guarantee. I understand it is a departure from the medical practice norm; but think about it, it isn’t uncommon in any other place. Hotels and car rental companies require one to leave a credit card on file. Blockbuster did to. Unless you are on a pay-as-go cell phone plan, you have to provide a credit card to cellphone companies.
So why can’t we?
Think about this… if people owe the practice more and more money, how will one continue to provide medical care? A broke doctor doesn’t do anybody any good.
Start requiring a credit card from your patients. You’ll thank me later.