BACK TALK SYSTEMS, INC. 14998 W. 6th Avenue, Suite E-500 Golden, CO 80904-5025 800/937-3113 800/696-1165 (fax) www.backtalksystems.com Team Tip #49 MONEY MATTERS (part 5) by Susan Hoy THE BEST COLLECTION SOLUTION IS NOT TO HAVE A COLLECTION PROBLEM AT ALL! Up until now, we've done everything possible to avoid a collection problem, but you are still going to have a few no matter how hard you try. So, what do you do when an active patient owes you money that needs to be collected? Most offices have a maximum balance "policy" and they let that patient know that he or she is reaching the maximum limit. I personally dislike telling patients our policy limit because I believe they will pay you just enough to avoid breaking through the limit. In other words, they think it is permissible to keep the maximum balance. What do you do when an active patient has a balance? First, discuss the problem with your doctor and decide how you want to approach the patient. There are times when patient confrontation is necessary and this is one of them. The confrontation should be from a concern standpoint and certainly should not be the least bit hostile. Patients must perceive that your motive is to help them continue care and return to health, not to hassle them. The patient's dignity should be kept firmly in tact. Never speak to a patient regarding a sensitive issue where others are within hearing distance. Either take him into a private room or speak to him in the adjustment room before the doctor treats him. Before you confront him, get yourself into the proper state of mind. Remember to show concern for the patient, not hostility! Decide in advance what you are going to say and what you want the outcome to be. Then, approach the patient with confidence. Do not let him patient know you are the least bit uneasy about your conversation. Believe me, he will be able to detect your insecurity and uncertainty. Let's say that the patient owes you $100 and that is your office policy limit. You have decided, in advance, that you would like the patient to pay at least $25 against the balance along with today's full fee. "Good Morning Mr. Jones. I want to take this opportunity to speak with you before you see the doctor today. I notice that you have a balance of $100. I always get concerned when patients owe balances, for two reasons. One is, of course, that it is my job to make sure Dr. _________ 's cash flow is reasonable, but more importantly, I know what happens when patients owe a balance. They end up dropping out of care because they feel uncomfortable about owing money. The worst part is that they don't continue getting the care they need. I would love to solve this before that happens. (At this point, they will offer you an explanation as to why they have a balance.) After listening to your patient with compassion, you must search for a solution. "First, let me tell you that Dr. _______ does not know that you owe a balance. This is just between us. Would you be able to pay your balance along with your office fee today?" The patient will tell you he didn't come prepared to pay that much today. "Would you be able to pay half of your balance today?" If the patient is unable to do that, ask him what he could pay today. Because you started asking for more that you were willing to settle for, you will probably get close to what your wanted in the first place. You finally settle on 50% today and 50% on the next visit. "That's great, Mr. Jones, I really appreciate your cooperation. If you have any further concerns, please just let me know." Make sure you let your front desk know of the arrangement. Also, make sure your conversation is documented so you can be sure to follow through with the plan. Suppose the patient just cannot commit to paying down his balance due to a hardship. What do you do? First, get a commitment from him to at least pay for the visits he is receiving. Then ask him how he would like to handle the remaining balance. It is important to get some kind of commitment, even if it is five dollars a week. If the patient is sincere, he will commit and follow through with his promise. If a patient is unable to pay anything all, the doctor must be notified immediately. Ultimately, it is the doctor's decision whether to continue giving care to the patient. Remember, whenever you do patients a favor, and they are grateful, ask them to return the favor by referring others. Usually, they will bend over backwards to help you! It is most important to let patients know from the onset of care that you take collecting for services very seriously. There is something that we do in our office that I think is a really great idea and so do our patients. We have established a "helping others" account. Here's how it works. We have a few patients who insist on paying when they miss appointments. I know that seems strange, but it does happen sometimes. When one of those patients gives us missed appointment money, we advise them that it will go into our "Helping Others" account that will help patients who need care but can't afford it. We have other patients who will gladly put money towards our "Helping Others" account. One of our patients is very wealthy, and wants to make sure his insurance company pays only what it is responsible for. Often he will donate a portion of the insurance money to the "Helping Others" account. As we covered earlier, patients who owe money will often drop out of care. Now you are left with collecting the overdue balance. Of course, the first thing to do is attempt to contact the patient by phone. The time to do this is in the evening when the patient should be home. Again, make sure you are in the proper state of mind. Set aside a time that you will not be interrupted or distracted. Make your call from a concerned point of view. Don't prejudge and give him the benefit of the doubt. There is probably a very legitimate reason the bill has been left unpaid and it is usually a very sensitive issue. The script should go like this: "Hello, Mr. Jones, this is Susan, from Dr. ____________ office. How are you this evening?" Don't get too social, but get right to the point. "Mr. Jones, are you aware that you have an overdue balance in our office?" Mr. Jones will respond with either a reason why the bill has not been paid or he will tell you he was unhappy with his care (here again, the patient must justify the reason for not paying the bill). Attempt to set up a payment plan, and by all means when the conversation is completed let the patient know that he will certainly be welcomed back in your office at any time. Assure him that you have not made the doctor aware of his past due balance so he doesn't have to be embarrassed. If he tells you he was unhappy with the office or the care, do not get into a conflict. Just let him know that you will pass the information along to the doctor. Your doctor may want to contact the patient at this point or at least write him a letter. Many times I have found myself talking to a telephone answering machine. It is very difficult to leave a balance due message over the phone. The only thing to do in that case, is to ask the patient to contact you as soon as possible. It is not a good idea to leave a detailed balance due message! A letter to the patient is the next step. There should be a series of letters, ranging from friendly to firm. The following are a few examples of collection letters: FRIENDLY REMINDER (sent when bill is 30-60 days overdue) This is to remind you that your account has run well past the time usually extended to our patients. Our statement is enclosed. Your check today would be greatly appreciated. If you have already mailed your payment, please consider this a thank you note. Mr. Jones, please feel free to contact me if I can be of assistance in any way. I will be happy to discuss a payment plan if necessary. Sincerely, FIRM REMINDER (sent after 60 days) Our accountant has notified us that the present state of your account is serious! We want to maintain a good financial relationship with you, but that requires your cooperation. A statement of your overdue account is enclosed. It is our policy to maintain current patient status. We sincerely expect you will work with us regarding your account. Please send us check immediately or contact me so that we can make other arrangements. Thank you for your cooperation. Sincerely, SECOND FIRM REMINDER: (sent after 90 days) Your account has surpassed 90 days and this is usually the time that it would be turned over to our attorney. However, Dr. _________, has asked me to contact you one last time so that your credit will not be affected. Please send us a check in the amount of $_____ or contact our office to make payment arrangements. If we have not heard from you by a given date, your account will be submitted for collection. Sincerely, LETTER OF FORGIVENESS: As you know, you have had an open balance with our office for a long time. We have written you on several occasions, asking for payment and offering to help make payment arrangements. To date, we have not received your payment for your balance. Due to the fact that you either refuse or are financially unable to pay the debt you have established with our office. Dr. _________ has asked me to forgive your balance. Therefore, you will get no further statements from us. In the future, should you require treatment, you will be on a cash basis. Sincerely, The longer the balance goes unpaid, the less it becomes. Statements, letters and paper- work are expensive, so, solve your collection problems as soon as possible. Either, get the patient on a payment plan, forgive the balance, or pass it off to a collection agency, but don't dwell on it. The best collection solution is not to have a collection problem at all! You may order our new TEAM TRAINING AND PRACTICE MANAGEMENT MANUAL package, from which this article is taken, by calling 800/937-3113 today.