1 PowerPoint ® to accompany Second Edition Ramutkowski  Booth  Pugh  Thompson  Whicker Copyright © The McGraw-Hill Companies, Inc. Permission required for reproduction or display. Medical Assisting Chapter 17

2 Objectives: 17-1 Discuss the importance of accounts receivable to a medical practice Explain how to accept and account for payment from patients Prepare an invoice Manage a billing cycle efficiently Patient Billing and Collections

3 Objectives (cont.) 17-5 Describe standard collection techniques Explain how to perform a credit check Identify credit arrangements Recognize common collection problems. Patient Billing and Collections

4 Introduction  Medical Assistants will take on duties that are administrative in nature  Customers have various payment options Third party payers (insurance carriers) Payment plans Some have large outstanding balances A proper understanding and administration of billing as well as payment collection methods is required

5 Basic Accounting  Managing accounts receivable (money owed to the business) and accounts payable.  Converts practice’s account receivable delete into readily available income.

6 Standard Payment Procedures  Prefer to collect payments from patients at each office visit  Determine appropriate fees  Relative Value Unit (RVU) Doctor’s skill and time Professional liability expenses Overhead costs This methodology has reduced the growth rate of spending for doctors’ professional services, related services and supplies, and other Medicare B services.

7 Processing Charge Slips  Charge slips are also called fee slip or transaction slips  Numbered consecutively  Preprinted with common services and charges  Give each patient one when entering the office that includes date and patient’s name.

8 Accepting Payment  As the patient leaves you will ask for payment  Most practices accept: cash check credit cards insurance

9 Pegboard System  Each transaction on four different forms  Reduces errors and saves time  Called “one-write” system  Uses lightweight board with pegs Daily log sheets Patient ledger card Charge slips Deposit slips

10 Determining Payment Responsibility  Third party – responsibility to pay by insurance company  Minors – Parents or legal custody  Professional courtesy – doctor charges for what the insurance will pay or free

11 Standard Billing Procedures  Preparing Invoices Using codes on the invoice Using ledger cards Generating computer invoice Using independent billing services Sending invoices electronically Prepare an invoice to mail to the patient who does not pay when services are rendered or who makes only a partial payment.

12 Managing Billing Cycles  Cycle billing is a common billing system that bills each patient only once a month but spreads the work of billing over the month.  Invoice groups of patients every few days

13 Standard Collection Procedures  Statue of limitations – set time limit on when a collection suit on a past due account can legally be filed.  Open book account –open to charges made occasionally  Written contract account – contract with patient to pay over four installations  Single entry account- account with only one charge

14 Using Collection Techniques  Initial telephone calls or letters  Do not call patients at work or leave a message on an answering machine.  Call the patient at home

15 Preparing Statements  A statement is an invoice that contains a courteous reminder that payment is due.  Collection letter 60 days – nice but firm 90 days – stronger wording 120 days send a final letter about payment or giving the account to a collection agency.

16 Preparing an Age Analysis  The process of classifying and reviewing past due accounts by age from the first date of billing. List all patients account balances when the charges originated. Use patient ledger cards and color coded tags to indicate the number of days past due. Click for Sample Age Analysis

17 Sample Age Analysis Back

18 Laws of Debt Collection  Fair Debt Collection Practices Act of 1977 Do not call before 8 a.m. or after 9 p.m. Do not make threats or use profane language. Do not discuss patient’s debt with anyone else. Do not use any form of deception or violence to collect a debt.  Telephone Consumer Protection Act of 1991 Do not use an automated dialing device for calls to patients.

19 Observing Professional Guidelines  Appropriate to assess finances charges or late charges on past due accounts if the patient is notified in advance.  Must adhere to federal and state guidelines that govern these charges.  The physician should use compassion and discretion when assigning charges in hardship cases.

20 Using Outside Collection Agencies  Select a collection agency to manage the account.  Must be careful to avoid collection agencies that use harsh or harassing collection practices.  Give agency only needed information about non-medical information.

21 Performing a Credit Check  Employment Verification  Credit Bureau Reports – a company that provides information about the credit worthiness of a person seeking credit.

22 Laws Governing Credit  Equal Credit Opportunity Act May not deny credit based on patient’s sex, race, religion, national origin, martial status, or age.  Truth in Lending Act Covers credit agreements that involve more than four payments Must sign, discuss, and retain copies of a disclosure statement

23 Common Collection Problems  Hardship cases Patients may be poor, uninsured, or underinsured  Patient relocation and address changes Remember not to discuss a debt with anyone except the person responsible for the charge

24 Apply Your Knowledge What is cycle billing ? Cycle billing is a common billing system that bills each patient only once a month but spreads the work of billing over the month Answer -Answer

25 Summary Medical Assistant Obtain payments by cash, check, or credit cards at the time medical services are provided. You may assign the fee for these services and collect payment.

26 End of Chapter