Is your private medical practice familiar with sending an account to collections? In the age of higher deductible plans and the Affordable Care Act, patients are on the hook for more and more of their health care costs. Unfortunately, this can have a negative effect for private practice in the cases where patients cannot or will not pay. In that light, let’s take a quick look at how the collections process works, tips to implement, and applicable Florida law.
Medical billing statements and effective revenue cycle management
An effective medical billing statement is one of the most important steps early in the process of revenue cycle management. Three ways to make medical billing statements more likely to result in payment are 1) explaining charges in detail, 2) clearly communicate a due date, and 3) offer a way to pay directly through the form. All three of these steps are spelled out in more detail here, and all three are likely to increase your chances of getting paid in a timely, reliable manner.
It’s also very important to have a process in place to follow up on claims (for both payer reimbursement and patient collections). Great practice management software is essential to keeping track of accounts and keeping a tab on the financial health of your practice. Partnering with a reputable medical billing company can ease a lot of this load and keep your practice on track. Read here to learn about outsourcing medical billing and whether it is the right move for your organization.
What happens when medical billing statements and revenue cycle management fail?
This is when a final notice comes in handy - the last step before going to collections. According to National Service Bureau, “The final notice is intended to be the last communication between you and your client regarding the amount past due. When you get here, the assumption is that you’ve already exhausted all of the internal options in your receivables department. The point of the final notice is to let the delinquent client know you are no longer going to work with them to resolve payment as the account is being forwarded to a collections company. It is your last formal communication, and in many cases, signifies that the business relationship is finished.” Substitute “patient” for “client” and there you have it: a last effort to collect on patient obligations before going to collections.
Of course, there may be some additional factors that a medical practice might consider before sending an account to collections, such as working with a particular family for a decade or more. To learn more about these, download our ebook “Patients That Can’t or Won’t Pay.”
When the decision is made to send an account to collections, be sure to partner with a collection agency that specializes in medical debt collection, and will represent your practice in the same way that you would. Both of these factors are important in order to preserve patient dignity and physician professionalism, and also to give you the best chance of collecting on accounts past due.
A Note on Healthcare Collections in Florida
Here is some relevant information from Karina Gonzalez of the Florida Healthcare Law Firm Blog:
“Florida has enacted a prohibition on waiver of co-payments and deductibles. F.S. §817.234 (7), provides that it is insurance fraud for any service provider, other than a hospital, to engage in a general business practice of billing amounts as its usual and customary charge, if the provider has agreed with the insured or intends to waive deductibles or copayments or does not intend to collect the total amount of the charge. In looking at whether the provider has engaged in this general practice, consideration is given to evidence of whether the provider made a good faith attempt to collect the deductible or copayment. Florida has imposed criminal charges ranging from third degree felony to first degree felony. F.S. § 817.234 (11). (There are limited cases applying state law insurance fraud provisions and the case law that does exist is concentrated in a few states).
The prevailing theory is that if an out-of-network provider accepts the insurer’s payment, less the copayment or deductible as payment in full, the provider is overcharging the insurer for the service. Commercial insurers and other managed care plans are now taking the position that routine waivers result in a charge that is a phantom number and does not represent the usual and customary charge for the out-of-network provider’s services. These commercial insurers and plans further take the position that there is no obligation to reimburse the services where there is evidence of a routine practice of waiver.
Providers can have a policy of non-routine waiver of cost-sharing amounts but it must be based on documented financial need which should only be determined and offered in a very controlled and compliant way. Providers and staff alike must be well trained and educated on these issues to avoid getting tangled in the ever growing web of regulatory reach.”
We hope you enjoyed this discussion of how medical billing, revenue cycle management, and healthcare collections intersect. Please be sure to contact us with questions, or comment if you’d like to discuss any of these issues further. Keystone Health Partners stands ready to help private practice in Florida succeed!
