The recent trend among insurers to increase the out-of-pocket costs for patients in an effort to reduce healthcare costs has resulted in delays and defaults by patients in payment for services and other medical expenses. The Kaiser Family Foundation reports that since 2006, the average deductible rose from 52% to 72% by the end of 2012.
While the implementation of the Affordable Care Act (ACA) promises to increase the availability of reimbursable services, for some patients needing more specialized and expensive treatment this availability may also translate into a much higher personal financial burden, resulting in payment default.
To mitigate these expenses and ensure prompt payment, practices may wish to consider two simple credit card options, providing a win-win solution for both patient and practice.
Option 1: Using a credit card on file system
Using the credit card on file (CCOF) system changes your collections from less-collectible back-end to paid-up front-end, with an estimated 95% of the patient’s obligation paid within 45 days of the date of charges. Patient card information is securely stored off-site, which allows your billing staff to easily charge co-pays, deductibles, and remaining balances after insurance has paid their share. If desired for uninsured patients or those facing expensive treatment and high deductibles, a payment schedule in agreement with practice and patient can be drawn up ahead of treatment, using this program.
When a new patient sets an appointment, your staff should confirm insurance coverage as well as well as advise the patient to bring in insurance cards as well as be prepared to pay the copay at the time of visit. Using the CCOF method, the staff also advises the prospective patient that the practice keeps credit card information on file to guarantee payment after insurance has paid their share, as well as for co-pays, deductibles, and so on.
Normally, at the time of the appointment, the patient fills out the appropriate information, and the front desk, after confirming coverage and amount of deductible or co-pay, collects the amount from the patient. Some practices prefer to wait until the insurance company pays, but the trend, which is a good strategy if you want your past-due accounts to be rock-bottom, seems to be to collect up front.
To keep charges from overwhelming the patient’s credit card account, an agreement should state that no charges over a certain amount will be deducted without the patient’s permission. It also spells out the patient’s responsibility to notify the office if a card expires or becomes otherwise invalid.
Because the patient’s financial liability was handled up front at the time of charges, there are almost no ‘back-end’ collection efforts necessary, as outstanding bills will seldom become over 30 days old.
Option 2: Managing patient out-of-pocket expenses by credit card
When it isn’t feasible for a practice to keep card information on file for routine billing, a patient is offered credit card payment options when asked at the time of service to pay any outstanding co-pay, deductible, or non-covered charges. By using a credit card to handle these expenses, the practice can be assured of collecting any amounts due in a timely manner – an especially helpful consideration when dealing with large projected treatment or related expenses.
For help with answering your questions about billable charges, payment options, and other billing, coding or documentation concerns, contact M-Scribe Technologies, LLC – a leader in the medical reimbursement and documentation fields.