Payment plans permit the patient to pay off the amount they owe for a service over a period, instead of requiring a lump sum payment. Offering payment plans to patients benefits your practice – and your patients; however, execution is key. Consider these tactics for success:
Put the ball in the patient’s court: instead of leading with the parameters of the plan, ask the patient, “How much more time do you need?”
Set a minimum payment; for example, $25, and maximum duration such as 12 months.
Keep it simple by seeking the “odd” payment upfront – for example, if $231.53 is owed, collect $31.53 at the outset, followed by eight $25 payments due.
Always collect the initial installment upfront; don’t set up a plan – and then let the patient walk away without paying anything.
Automate the process of reviewing for non-compliance: set your system to push the accounts with two missed payments to a work queue and have a rigorous protocol for follow-up.
Integrate your plan with a text-to-pay option or collect a credit card upfront. (Be sure to follow federal and state laws regarding storing credit card information.)
Establish an insurance category for payment plans, which is separate from patient receivables; this distinction allows for better reporting, as your practice has agreed to maintain the balance on your accounts receivable.
Payment plans may ease the challenges faced by practices based on incurring bad debt. Patients bear a greater financial responsibility than ever before. It is an opportune time to offer payment plans for patients, but execution is essential for medical practices.
Elizabeth Woodcock is the founder and principal of Woodcock & Associates. She has focused on medical practice operations and revenue cycle management for more than 25 years. She has led educational sessions for a multitude of national professional associations and specialty societies, and consulted for clients as diverse as a solo orthopaedic surgeon in rural Georgia to the Mayo Clinic. She is author or co-author of 17 best-selling practice management books, to include Mastering Patient Flow and The Physician Billing Process: Avoiding Potholes in the Road to Getting Paid. Elizabeth is a Fellow in the American College of Medical Practice Executives and a Certified Professional Coder. In addition to a Bachelor of Arts from Duke University, she completed a Master of Business Administration in healthcare management from The Wharton School of Business of the University of Pennsylvania. She is currently a doctoral student at the Bloomberg School of Public Health of Johns Hopkins University.
The contents of The Sentinel are intended for educational/informational purposes only and do not constitute legal advice. Policyholders are urged to consult with their personal attorney for legal advice, as specific legal requirements may vary from state to state and/or change over time.
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