Give the Financial Policy a Tune-Up
June 26, 2019
As deductibles continue to climb, many practices are shifting from billing after insurance pays to collecting patient financial responsibilities up front and prior to surgery. If yours is one of these, review your financial policy to be sure it is keeping pace with these changes.
Here are 8 things to do:
1. Ensure that all physicians in the group follow one standard policy.
We’ve been implementing collection policies for decades, and one thing we know for sure is that success starts from the top. When it comes to financial policies, variety is not the spice of life. All physicians must accept a unified policy. If they don’t, staff has too many different rules to follow, resulting in mistakes and marginal success.
2. Make it clear to patients exactly what they are being asked to pay.
The phrase, “You will be asked to pay your financial responsibility at the time of service,” is vague and unhelpful. Clarify your expectations, and distinguish between what patients are expected to pay for office services vs. surgery.
Here are a few examples, which could be included in your “due at the time of service” section:
• All co-payments, deductibles, co-insurance and fees for non-covered services are due at the time of service unless you have made payment arrangements in advance of your appointment.
• Insurance required co-payments are due when you check in for your appointment. If you arrive without your co-payment, we may ask you to reschedule.
• In the event you need surgery, we will provide you an estimate of your insurance required deductible and co-insurance amounts. A pre-surgical deposit of [Insert flat amount or percentage] will be collected prior to scheduling.
3. Include your no show policy and fee.
If you are wondering whether it’s acceptable to charge a no show fee, the answer is yes. And yes, your practice should.
Here’s some verbiage to customize:
We request that at least 24 hour advance notice be given to the office if you will be unable to keep your scheduled appointment. This allows us to release your appointment time to another patient. We charge an administration fee of $____ for no-shows. Patients who repeatedly “no show” for appointments may be discharged from the practice.
4. Define “self-pay.”
Self-pay can mean different things to different patients. Make sure you explain your definition in writing and that staff stick to it. Some examples of how you might define self-pay are shown below.
1. Patient does not have health insurance coverage.
2. Patient is covered by an insurance plan that our providers do not participate in.
3. Patient does not have a current, valid insurance referral on file.
4. Patient declines to provide a social security number.
5. Express your policy about referrals.
If the patient’s plan requires it, explain the need for an authorization from the primary care physician, and what happens if one is not obtained. Most practices allow a patient to call and request a referral from the primary care physician if they arrive without one. However, since no referral can mean non-payment, your financial policy should clarify what you expect from patients who present without a referral, and can’t obtain one prior to being seen. For instance:
Without an insurance required referral, the insurance company will deny payment for services. If you are unable to obtain a referral prior to being seen, you will be rescheduled or asked to pay for the visit in advance.
6. Explain your financial assistance policy.
Years ago, most practices didn’t include this in the patient financial policy, although staff may have verbally offered assistance of some kind or another if a patient requested it. With patients shouldering more of the bill and healthcare debt causing a significant number of personal bankruptcies, it’s important that physician offices have such policies, and provide patients with multiple options.
The financial assistance policy is typically an addendum to the financial policy, and covers details about patient financing options such as CareCredit, time of service discounts for uninsured patients, payment plans and how you administer them (like automated monthly payments on a credit card), and the definition of charity care.
Financial assistance is something patients must qualify for, so be sure to explain that fact, and have a financial assistance application ready to give to those who ask. We suggest qualifying patients using the U.S. Federal Poverty Guidelines, and asking for pay stubs and federal benefit receipts to verify application information.
7. Provide guidelines about billing, payments, and refunds.
For instance, if you haven’t collected in full and must send a statement, when is the full balance due? What if patients cannot pay within that timeframe – what happens next and what are their options?
What is your policy about patient overpayments? How about sending patients to collections? What’s the process and how can patients avoid this?
8. Clarify divorced parent and child custody obligations.
Avoid potentially sticky situations. Your financial policy could including something like the following:
The parent or guardian who brings the child to the office for care is responsible for payment at the time of service no matter if the account is self-pay, participating insurance, or nonparticipating insurance. The Practice does not honor divorce specifics (e.g., percentage of financial responsibility), and will not bill a divorced spouse for the patient’s services.
If the child has coverage with a participating insurance plan and the proper insurance identification is present at the time of service, the practice will bill that insurance company. Applicable co-payments, coinsurance and/or deductibles are due at the time of service, unless arrangements have been made with the office prior to arrival.
Author - Karen Zupko, President
An internationally recognized thought leader and speaker, Karen Zupko advises physicians and healthcare managers about the challenges and trends impacting the practice of medicine. Click here for more info about the author.
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