Slide 1 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Chapter 10 Office and Insurance Collection Strategies

Slide 2 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Learning Objectives  Define credit and collection key words terminology and abbreviations.  Translate collection abbreviations.  Define aging analysis.  State the names of the federal credit laws applicable to a physician office setting.  Define accounts receivable and explain how it is handled.  Recite types of fee adjustments available to patients.  Name payment options available to patients.

Slide 3 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Learning Objectives (cont’d.)  Perform oral and written communication collection techniques.  State the role of a billing service, collection agency, and credit bureau in the collection process.  List possible solutions to collection problems.  Explain the purpose of small claims court in the collection process  Name basic actions in tracing a debtor who has moved and left no forwarding address.

Chapter 10 Lesson 10.1

Slide 5 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Cash Flow Cycle  Physician revenue largely from reimbursement by third-party payers  Insurance contracts with payers  Reimbursement provisions  Medical services not covered  Patient responsibilities  Reimbursement process

Slide 6 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Reasons for Accounts Receivable  Increased health care expenses  Health care perceived as a right  Legal proceedings  Insurance delays

Slide 7 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. New Patient Confirmation Letter

Slide 8 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Signs of Potential Nonpaying Patient  incomplete information on registration form  multiple changes of residence  questionable employment record  no business or home telephone  post office box listed with no street address; or motel address listed  incomplete insurance information  no referral

Slide 9 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Fee Adjustments  discount  cash discounts  financial hardship  write-offs  professional courtesy  copayment waiver  no charge  reduced fee

Slide 10 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Ledger Card Financial Accounting Record

Slide 11 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Communicating Fees 1. Be courteous at all times but express a firm, businesslike approach that will not offend the patient. 2. Never badger of intimidate a patient into paying; merely state the payment policy and educate the patient. 3. Inform the patient of the fee and any deductible and balance due in a clear manner. 4. Verify the patient’s copayment listed on his or her insurance card and collect this amount before the patient’s office visit.

Slide 12 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Communicating Fees (cont’d.) 5. Make it easier for the patient to pay rather than leave without making payment. 6. Do not give the patient an option by asking if he or she would like to pay now or have a bill sent. 7. Motivate the patient to pay by appealing to his or her honesty, integrity, and pride.

Slide 13 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Collecting Fees  Payment at time of service  Payment by check  Itemized statements

Slide 14 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Financial Agreement Form

Slide 15 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Demand Letter for Returned Check

Slide 16 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Itemized Statement

Slide 17 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Collection Decision Tree

Slide 18 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Billing and Collection Guidelines  First statement at time of service  Mail second itemized statement  Third statement 30 days later  First phone call/suspense  Second phone call with 5-day notice  Written 10-day notice with next steps  Take steps indicated in prior statement

Slide 19 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Payment Options  cash  check  credit card  debit card  e-checks  payment plans

Slide 20 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Credit and Collection Laws  Equal Credit Opportunity Act  Fair Credit Reporting Act  Fair Credit Billing Act  Truth in Lending Act  Truth in Lending Consumer Credit Cost Discloser  Fair Debt Collection Practices Act  Statute of limitations

Chapter 10 Lesson 10.2

Slide 22 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Telephone “Don’ts”  Don’t raise your voice.  Don’t accuse the patient of lying.  Don’t act tough.  Don’t consent to partial payment.  Don’t debate.  Don’t report disputed accounts to collection agency or bureau.

Slide 23 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Collection Form Letter

Slide 24 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Multipurpose Collection Letter

Slide 25 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Collection Abbreviations

Slide 26 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Insurance Payments  History of accounts  Coinsurance payments  Insurance checks sent to patients  Managed care organizations  Medicare  Medigap insurance  Worker’s compensation  Suing a third-party payer

Slide 27 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. When to Use a Collection Agency  when patient says he won’t pay  when patient breaks promise to pay  when partial payments, but 60-day lapse  failure to respond  returned check  insurance company payment not forwarded  misinformation  can’t be located

Slide 28 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Collection Agencies  Choosing an agency  Types of agencies  Agency operating techniques  Agency charges  Agency assigned accounts

Slide 29 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Filing a Court Claim  Obtain claim of plaintiff form.  File papers with the court.  Pay the filing fee.  Arrange to serve the defendant.  Set trial date.

Slide 30 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Tracing a Debtor (“Skip”)  Check the address on returned envelope.  Check the ZIP code.  File a request at the post office.  Look in the phone book.  Call the primary care physician.  Check with hospital accounts department.  Inquire at place of employment.  Call contacts on patient’s registration form.

Slide 31 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Special Collection Issues  bankruptcy  terminally ill patients  estate claims

Slide 32 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Types of Bankruptcy  Chapter 7  Chapter 9  Chapter 11  Chapter 12  Chapter 13

Slide 33 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Filing an Estate Claim  Confirm death.  Pursue payment from third parties.  Contact the county.  File the claim.  Send itemized statement to the attorney.  Follow up as needed.

Slide 34 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Patient Complaints  Listen.  Thank the person.  Apologize.  Answer the complaint.  Be professional, sincere.  Take it seriously.  Respond in letter form.  Be cordial.

Slide 35 Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved. Other Considerations  Collection controls  Embezzlement  Precautions for financial protection  Bonding