As businesses cut jobs and benefits including health insurance, patients may come to your practice with financial problems in addition to their medical ones. Assisting these patients without hurting your practice requires a little prevention and pre-planning and some extra attention from your office staff. The good news is that the policies and procedures you put in place during these tough times will lay a foundation for the future that allows you to provide comprehensive services while protecting your practice's finances and complying with billing regulations.

Discounts for cash-paying patients

The first thing you should know is that physicians can offer discounts to patients who cannot afford to pay. This is not a violation of the Medicare anti-kickback statute as long as the practice does so based on the individual patient's financial need and documents the need in accordance with established policy.

This policy should include verifying the patient's household income, expenses and available assets. A form like the one shown in this article can be used to obtain this information. (

or

) Practices should designate a person to review the information, verify current income (for instance, by checking a previous year's tax return, current paycheck stub or unemployment benefits) and determine whether a complete write-off, percentage discount or payment plan would be appropriate.

The federal poverty guidelines are a good basis for establishing your standards for providing discounted or free care; you can view them online at http://aspe.hhs.gov/poverty/09poverty.shtml. For example, you might choose to provide discounted services to uninsured patients who pay at the time of service and whose family income is less than 300 percent of the poverty level for their family size. You might offer a 20 percent discount to those with family incomes between 200 percent and 300 percent of the poverty level and larger discounts to those closer to the poverty level.

When developing your financial hardship discount program or other programs designed to aid those in need of medical care, be sure to review your practice's financial reports to determine the percentage of patients who do not have insurance and the amount of your charges already written off to bad debt or charity. Then consider whether systematically providing financial hardship discounts is financially viable. Keep in mind that such a program might also reduce the amount of bad debt in your practice and the overhead associated with trying to collect it.

Insurance options

Patients who lose their jobs may need information to help them make good financial decisions during tough times. To some patients it may seem crazy to pay a COBRA premium to extend their insurance coverage when money is tight. (The Consolidated Omnibus Budget Reconciliation Act of 1985, or COBRA, allows certain individuals the option of temporarily continuing the group health coverage that they had received from their employer.) However, COBRA insurance may seem a more realistic option to those who understand that they would pay their former employer only 35 percent of the premium; the remaining 65 percent is reimbursed to the employer through a tax credit established as part of this year's economic stimulus bill. Maintaining continuous coverage can prevent exclusion of benefits for pre existing conditions under future policies. You and your staff can help by referring patients to the web sites listed in “Resources for patients without insurance coverage,” below.

Finally, it is helpful to establish a relationship with your local health department as well as with federally qualified health centers and free clinics in your area. Be ready to share information about these entities and the services they offer. If possible, keep handouts in your waiting area and at the scheduling desk so the information is readily available when needed. You may be able to acquire patient information handouts directly from these groups.

The article on page 21 describes comprehensive strategies that Robert Forester, MD, and Richard Heck, MD, have used to keep costs down in their cash-only practice. Half of their patients are uninsured, so the authors have honed their skills at providing cost-effective care. If you have other ideas and resources, we hope you'll share them. These are hard times for many patients, and family physicians play a key role in the nation's health care safety net.