Here's a successful collection policy: Expect your patients to pay for services when they're rendered, even if the patients' insurance eventually will pay for them. If this seems hard-nosed, think of it like this: You grant credit to every patient who doesn't pay at the time of service. This is nothing to take lightly. Practices should carefully consider the circumstances in which they're willing to offer credit rather than simply giving it to everyone.

There's more to it, though. A dollar collected today has more value than a dollar collected tomorrow — and a lot more than one collected 60 or 90 days from now. In addition, statements cost an average of $5 to generate, considering paper and printing costs, postage and staff time. So the value of the dollars you collect drops with the first bill, and it drops even further with each month the account ages. You also have to consider the value of your staff 's time. In a busy practice, the work your staff puts into collections could be used in more beneficial, and more profitable, ways.

Will it work?

A same-day-payment policy can work for every practice but not for every charge. You can't collect from patients who are covered by insurers with which you have direct-payment contracts, e.g., capitated plans (although you should collect co-payments on a same-day basis). But for most practices, this caveat still leaves plenty of patients who should be paying for what they get when they get it.

You may be thinking, “If I ask patients to pay out-of-pocket for charges they're used to waiting for the insurer to pay, I won't have any patients.” Not so. Implementing a same-day- payment policy won't jeopardize your patient satisfaction if the process is handled well. You must explain how the new policy will help patients and the practice by keeping costs down and improving efficiency.

But just posting a sign by the check-in desk isn't going to be enough to get the message out. Once you've thoughtfully set your credit terms and defined them in your billing and collection policy, you need a strategy for clearly expressing your same-day-payment expectation without alienating your patients. The key is to give your staff clear guidelines — even scripts — detailing how to guide patients' expectations and what to say when they ask for credit.

No surprises

Well before you introduce same-day payment, you need to get your patients ready for it. Send an explanatory letter to patients a month before the policy change. The letter will help ease the transition by removing the surprise factor and by preparing them for any procedural changes. (See “A sample introductory letter.”)

Train your staff to spread the word

Your staff must be comfortable discussing financial obligations with patients. You can build that comfort zone by giving employees the right tools and training.

First, your staff members (and all patients) should receive copies of your billing and collection policy. But formal policies only go so far as communication tools. Scripts for common patient-staff interactions are very effective in helping employees communicate the right information in the right way. A good script for a typical payment conversation — such as a conversation about whether a patient's insurance covers proposed services — ensures that your staff will give accurate information about what and when patients are expected to pay, and it can help staff members respond to common objections.

Communicating about same-day payment should begin with the patient's first contact with your practice, before he or she ever sets foot in the office. Since many patients have become accustomed to the “care now, pay later” approach, make it clear from the start that you expect payment at the time of service. Patients generally are more willing to do what you ask if they aren't caught by surprise.

Your script for this conversation should explain your payment policy briefly, in friendly and helpful terms. Once the patient's need for care is established, but before scheduling an appointment, your staff member should begin by saying something like this: “The charge for your visit will be between $35 and $65, depending on the level of service performed that day, and there may be additional charges for lab work or procedures. We ask for payment up to $100 at the time of the visit, and we accept cash, checks, Visa or MasterCard. We will be happy to bill your insurance for you so you can be reimbursed. What type of insurance do you have?”

If your practice works with the patient's insurer, the staff member should proceed this way: “Please be sure to bring your insurance card with you so we can get the necessary information from it. If you have any other information that may be helpful — such as phone numbers for your benefits representative at work, the plan's case manager for claims, the claims processor for your employer group or other important people to contact — please bring that information as well.”

If your practice doesn't work with the patient's insurance plan, the staff member should ask for same-day payment of the full amount: “I'm sorry, but Dr. Jones doesn't participate with that insurance plan. You are still welcome to come to our practice, but we'll have to ask for payment in full for all services at the time they're rendered. Will that be a problem?”

Make it hard not to pay

It's also important to combine the design of your check-out area with an assertive attitude to make on-site payment something your patients have trouble avoiding. First, patients need to meet the billing and collection staff when checking out. Then those staff members need to ask directly for payment. It's that simple: If patients aren't asked, they won't pay. And if staff members don't ask, they show patients that the policy is meaningless. Accepting credit cards is a great way to make it convenient for patients to pay on the spot. Many people are accustomed to using a credit card and paying one monthly bill. And this way, the patient — not the practice — takes responsibility for his or her credit.

Be flexible

Unfortunately, even if your staff does everything right and follows your policy to the letter, some patients still won't be able to pay while they're in your office. Patients do forget their checkbooks and run out of checks, and some legitimately can't pay until their next payday. Give those who can't pay a statement of the amount due along with a stamped, self-addressed envelope. Most will send their payments promptly because they will appreciate your flexibility. The money will be received sooner and with less expense than if the practice had sent out end-of- month statements.

Another part of being flexible is to realize that you may not want to apply a same-day-payment policy to all patients. For example, you may want to exempt established Medicare patients who have secondary coverage. Doing so will cut down on the number of refunds you'll have to make. Similarly, be flexible about applying the policy to patients who have come upon hard times. The key is to temper your same-day-payment policy with common sense.

Prompt insurance billing helps

If you expect your patients to pay up front, they'll expect your practice to do its part to speed their insurance reimbursements. The practice can help most by submitting insurance claims daily for all patients and all services. Although this may complicate life somewhat for your billing staff, it will pay off for your practice by helping to keep your patients satisfied — and coming back to receive the care they need.