What’s the worst thing that can happen when you staff aren’t trained to manage patient deductibles and collect up front?  It’s not that you won’t ultimately get paid.  There is something worse that can happen, and it’s not that uncommon: your practice can end up losing the revenue for the service and losing the patient.

Here’s how it can happen.

An ill patient comes in for a service and doesn’t realize she’s financially responsible for the entire cost.  No one who interacts with the patient ahead of the service — not the scheduler, not the person who calls her to remind her — lets her know she’ll be financial responsible, or estimates her costs.  The patient arrives, hopeful she’ll be paying just a copayment.  And the front desk makes her day by charging only a copayment!  “You might have a balance, we’re not sure.  Don’t worry. We’ll bill you,” the receptionist assures her cheerfully.  The patient relaxes.

But when the patient receives the bill — six weeks after that service she really needed — she’s shocked to find out that she owes hundreds of dollars more.  Her insurance didn’t cover any of her visit or her tests, because she has a $3,000 deductible to meet first.

By now, though, this patient needs another visit for follow-up care.  She calls to schedule the appointment.  “WARNING: PAST DUE” pops up on the scheduler’s screen.  “Oh! I need to alert you that you’ll be expected to pay your past due balance in full when you come in for your visit,” the scheduler reminds the patient seriously.  The patient is embarrassed — and worried that she can’t pay that full amount at her next visit.  She needs the care, but, on the day of her appointment, she thinks about the prospect of being confronted at the front desk for an amount she can’t pay in one lump sum — and about the fact that she’ll be adding to the balance due.  She weighs her options — and no-shows on her appointment.  She needs to be seen, but the embarrassment outweighs that need in that moment of decision.

The next bill arrives.  It includes a no-show fee of $30 on top of her balance.  Then the next one includes a warning that failure to pay risks transfer to a collection agency.  On top of embarrassment and stress, the patient now feels resentful.  There appears to be no benefit to paying the token amount the patient could pay right now.  And there’s no easy way for her to make such a payment.

Because the patient needs care, but can’t face the people at her current practice, she takes a drastic step: she switches to another doctor.  At least with the new practice, she reasons, I can start fresh with a $0 balance.

In this example — a very common pattern among practices we’ve worked with — several mini-disasters occurred, beyond just the loss of revenue. A patient who needed care was afraid to get it. A doctor who cared for the patient lost a positive relationship. Thanks to the patient’s resentment and embarrassment, the physician may even have gained an undeserved black mark on his reputation.

It’s counter-intuitive to think of collecting deductibles as a patient-centered action.  But explaining insurance terms and obligations, and preparing patients for what they’ll be expected to pay, is a critical service to the patient.  By doing so, your team reassures the patient about what’s to come — and ensures there won’t be an unexpected, unpleasant surprise when the statement arrives.  Collect a portion at the time-of-service, to keep that bill from ballooning, and allow patients to use whatever credit card they like.  Put a credit card on-file to make it even easier for the patient — or use a technology tool to set up affordable payments that are charged automatically to the patient’s credit or debit card.

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