FAQ: When Can I Send a Patient to Collections?

The increase in cost of medical collections over time

FAQ:

When can I send a patient to collections?

Answer:

You can send a patient to collections at any time. Payment for services rendered is due at time of service or shortly after patient responsibility determination.

Best Practices:

There is no written law requiring private healthcare organizations to provide a certain time period or number of notices to a patient with a delinquent account prior to sending them to collections.

It is not recommended to send a patient immediately to collections if they do not pay their balance in full within a few days of their visit. However, allowing a patient to wait 60, 90 or even 120 days before communicating with you about their bill is also not suggested. Because people pay their bills emotionally, it is necessary to discuss their balance with them while your services are still important to them.  It is important to determine the right balance of time for your practice, and to commit to it.

Patients have been taught that they do not have to pay their medical bills right away. Many practices give discounts after a certain period of time to encourage payment or include an aging bar on their patient statements. While an aging bar may appear to be a reminder to the patient that their balance is overdue, what it is really telling them is that your healthcare organization will wait up to the maximum number of days on that bar before taking any action.

“Nearly 75% of best performers start collection follow up in less than 30 days from discharge.” – American Hospital Association

The older a delinquent account becomes, the less likely it becomes that your practice will collect on it. Review the payment histories of your patients and determine the right amount of time for your practice to wait before sending a patient to collections. Best practices suggest following up with the patient by phone rather than just sending statements. According to the American Hospital Association, “nearly 75% of best performers start collection follow up in less than 30 days from discharge, and 50% of best performers start follow up by phone in less than 20 days from service.”

With the rise in patient responsibility under the Affordable Care Act it is more important than ever to communicate with patients and to help them understand their balance. Often when they receive a statement or an explanation of benefits and they do not understand what they owe, which makes them less likely to pay.

Once you have decided upon a timeline, include it in detail in your practice’s financial policy so that your patients understand what is expected. Finally, update your patient statements and notices and commit to monitoring each patient’s account to ensure your financial policy is being complied with.

Need a little help getting started? Visit our resources page for sample patient statements, notices and financial policies, or register for a free Collector University seminar for training on collecting from patients.

Download the Fact Sheet for this article here.

Not sure where to start in finding the right agency for your practice? AR Logix Inc.’s third-party medical collections program, Berks Credit & Collections, offers competitive rates and industry-leading liquidation. Our FDCPA and HIPAA-trained representatives work exclusively within the healthcare industry and take a nonjudgmental approach to collecting from your patients, so you can maintain your relationship with them while improving your revenue. For more information and rates, contact us today!

Written by Ali Bechtel, Public Relations Coordinator

This information is not to be construed as legal advice. Legal advice must be tailored to the specific circumstances of each case. Although we attempt to provide up-to-date information, laws and regulations often change. We make no claims, promises, or guarantees about the accuracy or completeness of this document. For legal advice, please consult an attorney.

2 Responses to “FAQ: When Can I Send a Patient to Collections?”

  1. Elaine Says:

    Do you have any insight on sending a patient to collections that is covered under a form of Medicaid in Ohio? I have several cases where patients have presented with one Medicaid and they are really covered under another Medicaid plan that we are not in network with. The patient has signed all the appropriate financial documents in our office. But we have been told that patients on Medicaid are not financially responsible for anything. can I still send it, because the patient presented with the incorrect information? Or do we have to take it at a loss?

  2. admin Says:

    Great question, Elaine! (And thanks for your readership!) Per our Reimbursement Services Director: Out of state Medicaid can be difficult. Since the patient went to an Out-of-Network facility/provider, they would be responsible for the bill. Consumers are aware and should be told where they can and cannot render their services. If we find out that they have a different product or out of state Medicaid policy, claims should be billed to see if they will process the claim or if they will deny. This is to prevent any type of discrepancy and to have proof that proper steps were taken to try and resolve the claim. If all of these steps were done and results show that it indeed was the patients responsibility, than we could send them to collections. Yes, there are guidelines as to what we can and cannot balance bill the patients. However, these guidelines cannot be presented unless all steps were proper taken to ensure the billing process was completed entirely.

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