Collecting payments from patients is a tough job, especially from self-pay clients. According to the Crowe RCA Benchmarking Analysis report, the self-pay-after-insurance collection rate decreased from 76% in 2020 to 54.8% in 2021. Medical billing solutions provide revenue cycle modules to help you boost patient collections. If you want to learn other methods to improve collections, you’re at the right place!
Compare Top Medical Billing Software Leaders
What This Articles Covers:
- Importance of Improving Collections
- How Does Patient Volume Affect Your Revenue Flow?
- Ways To Accelerate Collections
- Patient Collection Trends
- Wrapping It Up
Without further delay, let’s get started!
Importance of Improving Collection Workflows
Even today, several providers rely on manual and paper-based collection processes. It can cause payment delays and hinder your staff’s productivity.
According to the Trends in Healthcare Payments Annual report published by InstaMed in 2022, 75% of providers used paper and manual collection processes in 2021.
Some challenges you might face due to manual collection workflows are as follows:
- Billing and coding errors
- Poor collection recovery rate
- Security threats
- Loss of patient records
- Payer contract issues
According to a recent MGMA Stat Poll, 56% of medical practices said their A/R days increased in 2022. This causes collection delays, affecting your revenue cycle negatively.
To overcome collection challenges and improve patients’ financial experiences, you can provide digital payment options and send in-app payment reminders to nudge clients to pay on time.
This article outlines several other methods you can employ to escape collection problems.
How Does Patient Volume Affect Your Revenue Flow?
Patient volume is the total number of patient encounters you dealt with during a specific period. You should calculate your patient volume to evaluate your practice’s financial performance.
Low patient days can impact your revenue cycle. Kaufman Hall’s National Hospital Flash Report October 2022 reported a 4% decline in equivalent patient days in September. You can notice the poor revenue performance in the same month — operating and outpatient revenue fell by 4%, and inpatient revenue decreased by 5%.
Some reasons for low patient volume are as follows:
- Low patient trust
- Rising health care costs
- Absence of payment plans
- Not enough payment options
- Negative reviews
If problems exist, solutions do too. You can increase your patient volume in the following ways:
- Maintain Consistent Outreach: You should send promotional messages to patients from time to time. You can remind them about booking annual check-ups or rescheduling missed appointments. You can also update them about new health plans via text, phone or email.
- Leverage Digital Tools: You should implement telemedicine solutions to help patients schedule virtual appointments, view X-rays and lab results, and make online payments. You can analyze past and current patient volume trends through dashboards.
- Offer Mobile Accessibility: Patients don’t want to spend time scouring through piles of physical files. They want online access to their documents.
- Provide Online Payment Options: Patients don’t want to visit clinics or hospitals just to pay bills. They prefer clearing their dues online. According to Salucro’s Patient Engagement Report 2022, 62% of patients make payments via an online patient portal using debit or credit cards.
- Schedule Follow-up Appointments: After the session, you should let clients know when to visit you next for evaluation. Informing them about their next steps shows that you care, helping you increase patient loyalty.
The higher the number of patient visits, the more revenue your practice generates. You need to develop strategies to retain current patients and spread word about your practice or hospital to attract potential clients.
Ways To Accelerate Collections
According to the InstaMed report referenced above, 70% of providers take more than 30 days to collect payments. Due to such delays, your medical organization might suffer from financial losses.
Compare Top Medical Billing Software Leaders
Below we’ve highlighted a few things you can do to speed up your collections.
Collect Accurate Information
You should train your staff to record correct patient demographics and insurance details. Encourage clients to complete consent and intake forms, questionnaires, and benefits information before appointments. When you have accurate information on hand, you can generate error-free statements. Hence, saving time reworking invoices.
Practice Point-of-Service Collections
Collecting payments at the time of service is the most effective way to boost your collection rate. Your billing department should be able to communicate to the client the costs of rendered services. You should make sure that there’s always staff available at the billing counter. Patients might leave without paying if they don’t find anyone at the counter.
You should let patients pay using credit/debit cards, online wallets and netbanking to increase point-of-service collections.
Leverage Patient Portals
Today, patients want real-time access to their payments and other health-related information. Patient portal software enables clients to view and download data and make electronic payments with just a few clicks.
According to a recent survey by Experian Health and PYMNTS.com on patients’ use of digital health channels, 22.1% of patients paid their health care providers via the patient portal.
Remember, select a patient portal that meets HIPAA privacy and security regulations. A portal non-compliant with HIPAA standards can invite lawsuits, resulting in federal fines.
With a medical solution, you can send automated payment reminders to clients to accelerate collections. You can also share superbills with clients with just a few clicks. Furthermore, you can add your company’s logo to statements to increase brand awareness.
Generate Well-designed Statements
Patients who don’t understand their bills are unlikely to make payments. It’s of utmost importance that you produce a statement that’s easy to understand.
It should include all charges, including services performed and adjustments made. You should add your telephone number, contact name and email address for statement inquiries.
Create a Payment Policy
The electricity department clearly outlines consequences for non-payment of bills — if you don’t pay the light bill, the light goes out. That’s why paying electricity bills becomes a top priority. Similarly, you need to create a payment policy highlighting outcomes for non-payment of medical bills.
You should make sure your patient clearly understands and signs the policy. So later, the client can’t say they weren’t aware of the consequences.
Offer Payment Plans
Not every patient can afford to pay upfront. According to Gallup and West Health’s Healthcare in America 2022 report, 55% of females and 45% of males are not very or not at all confident that they can pay for health care as they age.
Providing payment plans can help clients reduce financial stress. They help you:
- Establish a long-lasting relationship with clients
- Increase patient volume
- Improve clients’ financial experiences
- Reduce A/R days
According to a report on patient financial preferences published by Flywire, 77% of patients wanted to pay their unexpected medical bills in installments.
You should train your employees to explain payment plans clearly to patients to avoid misunderstandings. You should also ensure your payment plans comply with state and federal guidelines.
Word of Advice: You should avoid setting up payment plans that extend beyond 12 months. Convince patients to select the smallest repayment period. But don’t force them; always leave room for negotiations.
Provide Multiple Payment Methods
Today, patients want to clear their medical bills using their preferred payment method. According to the Healthcare Financial Trends report published by Commerce Healthcare, 60% of consumers agree that having multiple payment options is essential.
Clients prefer paying online than visiting providers’ offices to clear their dues. According to the U.S. Banks Healthcare Payments Insight report, consumers’ most preferred methods of paying medical bills are as follows:
- Netbanking —33%
- Mail — 32%
- Online bill pay — 31%
- Online portal — 28%
- Mobile app — 23%
- IVR — 12%
Digital solutions enable clients to make payments through debit or credit cards, digital wallets, cash or an online portal. You can also collect payments at the time of service using POS devices.
Plan Follow-up Programs
If you don’t communicate with your patients, you won’t know about their financial issues. But that doesn’t mean calling them 24/7. You can develop follow-up programs to reach out to guarantors or customers who missed their payment deadlines.
You can create a script for employees to follow when talking to patients. This will help you filter out any unintentional aggressive comments. Your staff should be confident in requesting payments and discussing payment plans.
Be Diligent, Not Annoying
There’s a fine line between reminding your clients to pay their outstanding bills and harassing them. If you continuously keep calling them, they might block your number and ignore you, causing payment delays.
According to a Consumer Financial Protection Bureau survey on medical billing and collection complaints, 32% of consumers filed debt collection complaints against medical providers, and 13% of clients reported that practices attempted to collect debts not owed.
The Federal Trade Commission implemented the Fair Debt Collections Practices Act (FDCPA) to prevent deceptive and abusive collection practices. According to FDCPA, collectors can contact patients only between 8 a.m. to 9 p.m. Clients can report collectors if providers violate FDCPA laws.
You should train your staff to be friendly with patients. Clients tend to work toward payments with someone who understands their situation rather than someone who keeps threatening them.
You can hire a debt collection agency to take the burden off your shoulders. But before forwarding medical bills to debt collection companies, send clients collection letters with specified deadlines to give them a last chance to pay their bills.
You should conduct a proper background check to see if its collection practices follow FDCPA guidelines.
Implement a Medical Billing Solution
You can automate your collection processes using medical billing applications. They help you track transaction details, generate statements and produce revenue reports.
Some benefits of medical billing tools are as follows:
- Avoid coding errors
- Reduce operational expenses
- Prevent denials
- Access patient details in real time
- File clean claims
You can implement a medical collection services solution to streamline business operations if you own a health care collection agency.
Some of the core features you should look for before selecting a billing application are:
- Patient portal
- Automated alerts
- Skiptracing modules
- Billing dashboard
- Reporting
- Insurance Verification
You can refer to our medical billing requirements checklist to assess your needs and make informed decisions.
Patient Collection Trends
Collecting outstanding balances can be tedious. The introduction of advanced technologies helped streamline collection processes. With new trends emerging every year, providers are doing their best to employ them in their day-to-day operations.
We have highlighted some of these trends below.
Rise of Telehealth
The coronavirus outbreak increased the utilization of telehealth services among health care organizations. The 2021 Telehealth Survey Report conducted by the American Medical Association divided telehealth programs run by practices into five stages. They are as follows:
- Implementation — 5%
- Optimization — 37%
- Sustainability — 69%
- Expansion — 26%
- Other — 7%
Artificial intelligence (AI) fuels telehealth modules. It enables you to enhance patient experiences, improve clinical outcomes and make data-driven decisions. You can generate cost estimates to help patients plan their finances.
Telehealth solutions help you review and store patient statements on cloud-based servers, replacing the old physical filing system.
You can send payment reminders to patients via email, text or phone. You can also access the collection dashboard to track accounts payable and receivable.
Age of Contactless Payments
Patients don’t prefer to visit hospitals just to pay their bills. They can clear their debts from the comfort of their homes through virtual payment portals. According to a survey by Raydiant, over 80% of customers opted for a contactless payment option to pay bills in 2021.
Today, consumers can pay by tapping their credit or debit cards onto POS devices. Customers can set a transaction limit to prevent thieves from withdrawing excess cash from their accounts.
The younger generation prefers paying their debts using online wallets like Google Pay, Apple Pay, PayPal, etc. The U.S. Bank Healthcare Payment Insight report mentioned above observed that 28% of patients aged between 26–35 prefer paying through mobile apps.
You can attach QR codes to statements to help patients clear their dues quickly. Insider Intelligence’s QR Codes Forecast and Trends 2022 report predict that the number of U.S. smartphone consumers scanning QR codes will rise from 83.4 million in 2022 to 99.5 million in 2025.
Self-pay collection practices can help you reduce A/R days and improve collection processes.
Adoption of Patient-centered Approach
Patients considered debt collectors as heartless villains who made their lives difficult with constant threats. This mindset about collectors started to change with the introduction of health care debt collection laws. Medical organizations violating such laws incur heavy fines.
We recommend you employ a patient-centered philosophy during collections. Several medical organizations offer financing options like payment plans, government funding and other alternatives to help reduce clients’ financial burdens.
Health insurance plans protect patients from high health care costs. But still, a lot of people are uninsured. The Commonwealth Fund Biennial Health Insurance Survey 2022 revealed that 9% of Americans were uninsured. You can run health plan awareness programs to educate patients about the financial benefits of the same.
Clients can misunderstand health care bills. According to the Forbes Advisor Survey 2022, at least 21% of individuals found medical bills confusing. You should ensure effective communication to help patients decode their medical statements.
You can leverage interactive voice response systems to assist patients in checking their outstandings and due dates. You can also send electronic statements consisting of your practice or hospital’s contact details to help clients reach out when in doubt.
Sharing Your Load With Billing Experts
It can be exhausting to handle the collections of thousands of patients. Hiring medical billing and coding experts might take some burdens off your shoulders. These professionals specialize in translating medical services into accurate codes, helping you determine correct patient charges.
Running a practice without billing experts isn’t a good idea. If you mess up the codes and generate an incorrect bill, patients can file lawsuits against you. And these legal proceedings can invite federal fines. Medical organizations hire certified billing and coding experts to evade such consequences.
Next Steps
It’s impossible to achieve your revenue goals if you suffer from collection delays. Several providers and credit reporting companies offer payment alternatives to improve their collection rates. You can also provide payment plans to patients to reduce their financial stress.
If you’re thinking of implementing a medical billing solution and are confused about making a decision, you can try our medical billing comparison matrix. It helps you compare multiple products and generate scorecards.
You can leverage our Decision Platform to validate and compare vendor responses and make informed buying decisions.
What strategies do you use to accelerate your patient collections? Please let us know in the comments below.