Some Practices Forced to Aggressively Collect Payments From Patients

With the recent economic downturn and a proliferation of patients enrolled in high deductible health plans, oncology practices are placed in the unenviable position of having to collect payments from patients. Worse yet, oncology practices may undercode services, which is something many oncologists already do, generally out of fear of penalties for overcoding, according to a study in the Journal of Oncology Practice. The study also cites sloppy billing practices as a prime example that can adversely affect income.

A recent story from Kaiser Health News reports that physician practices are getting more aggressive in how they collect payments from patients. The Medical Group Management Association says between 2008 and 2012, practices report seeing their bad debt go up 14 percentage points, which is money that practices were owed but couldn’t collect. Some of the practices have begun to change their billing strategies to combat those debts, says Ken Hertz, a principal consultant with the MGMA Health Care Consulting Group.

The article says that practices could send patients who don’t pay their bills to collection agencies sooner. Traditionally, practices wait up to 6 months before contacting an agency. By that time, the patient is feeling better, and less likely to pony up for what he owes. Hertz says he is encouraging practices to send patients to collections agencies after 6 to 8 weeks instead.

Another option is to collect the payments before a procedure even happens. This upfront payment model seems to be working for one orthopedic practice in Louisiana, according to the KHN story. Their patients are handed a tablet computer in the waiting room that has a credit card swiper attached. Patients are given the option to store their payment information for future bills. As a result, the practice has seen its bad debt lowered by 25% over the past 2 years.

Compounding the problem of delinquent patient payments is the grace period associated with the Affordable Care Act.

If an enrollee in a health exchange plan falls behind on his premium payments, the ACA requires insurers to cover medical bills for 30 days. But for the next 60 days, insurers may “pend,” or hold off paying the claims -- and ultimately, deny them if the patient doesn't catch up on his premiums. That means doctors don’t get paid for their services. If the insurer ends up canceling the policy after 90 days, doctors can bill patients directly but may face difficulty collecting.

It suggests that as health reform continues to roll out, physician practices may also have to take on more bank-like responsibilities.