Patient Financial Responsibility - defined in the Financial Policy of the Medical practice - they address all scenarios including:
- financial arrangements & payment plans - payments not covered by insurance - various special circumstances
Policies should handle:
- collection of copayments, deductibles & past-due balances - financial arrangements for unpaid balances - charity care or use of sliding scale for those w/ low incomes - payments for services not covered by insurance - prepayment for services - day-of-service discounts/ discount to those in financial need - acceptance of cash, checks, money orders & credit or debit cards - special circumstances for auto accidents & nonassigned insurance
Effective patient billing includes:
educating patinets from the start of the billing & reimbursement process.
Patient Information Form
often presents a statement about payment responsibility (see pg 563)
Encounter to Claim amount due process
Patient Encounter visit charges (transactions) entered in patient ledger patient's balance is updated claim is filed resulting payment from patient's insurance carrier is posted, based on the RA/EOB
Resulting info. from RA/EOB
1. payer's payment for each procedure is entered 2. Amount patient owes for each reported procedure is calculated 3. If any part of a charge needs to be written off d/t payer's required adjustment, this amount is also entered.
PMP uses the RA/EOB information to
update the day sheet and patient ledger
report summarizing the business day's charges and payments (recorded in the PMP)
shows services provided to a patient toatl payments made, total charges, adjustments and balance due
printed bills that show the amount each patient owes; computer generated from day sheet and patient ledger / both of these records have screens in the Practice's PMP
Patient Ledger Cards
manually generated bills that show the amount each patient owes;
Patient statements must be:
accurate and easy to read... clearly stating: - general info about the practice - cost breakdown of all services provided - date of statement & due date of payment (sometimes) - balances owed - Accepted methods of payment Clear and accuracy ensure patients pay on time
accepted from patient at time of service... patient then receives a zero balance statement
type of billing that divides patients with current balances into groups to even out monthly statement printing and mailing.
grouping patient billing under the insurance policyholder. i.e. all of the family's recent charges can be categorized and sent together on one statement. (good for families w/ minor children)
used to assign patient accounts to a specific time of the month and to standardize the times when statements will be mailed and payments will be due. i.e. if cycle is weekly, the patient accounts are divided into four groups / 1/4 of the bills go out each week.
Advantages/ Disadvantages of Guarantor Billing
- reduces amt. of time & $ spent on billing by reducing paper & mailing costs & reducing time spent on billing follow-up for those w/ overdue bills; fewer bills to track - Can become difficult & cumbersome when family members have various health plans and / or secondary plans
all the activities related to patient accounts and follow-up; they should achieve a suitable balance between maintaining patinet satisfaction & generating cash flow
- responsible for establishing office policies & enabling collections specialists to successfully perform their jobs. Create, implement, monitor, organize & develop, assist with, train, supervise & evaluate all that has to do with collections.
staff member with training in proper collections techniques, trained to work directly with the pratice's patients to resolve overdue bills. Must always act ethically, professionally... they represent the practice.
stealing of funds by an employee or contractor - Dividing collections tasks among several people with helps reduce chances of employee errors or embezzlement
Avoiding opportunities for fraud
dividing tasks and responsibilities among several different people
Fair debt Collection practices Act (FDCPA) of 1977
laws regulating collection practices Regulated by the Federal Trade Commission
Telephone Consumer Protection Act of 1991
law regulating consumer collections to ensure fair and ethical treatment of debtors Regulated by the Federal Trade Commission
Collections from patients are
1. classified as consmer collections 2. regulated by federal and state laws
FTC Guidelines outlined in FDCPA and Telephone Consumer Protection Act:
- contact patients 1x/day only; leave no more than 3 messages per week - do not call before 8am or after 9pm - do not threaten or use foul language - identify the caller, practice & purpose of call; don't mislead the patient - don't discuss debt with anyone but patient - no messages or emails detailing the debt owed - contact via email if patient requests calls stop - make calls to attorney if patient wishes,
Patient Aging Report
report grouping unpaid patients' bills by the length of time they remain due; Aging begins on the date of the bill.
patient aging reports
- contains patient's name - most recent payment - remaining balance DIVIDES information into categores based on each statement's beginning date: 1. Current or up to date (36 days) 2. Past Due (31-60 days) 3. Past Due: (61-90 days) 4. Past Due (90+ days)
Claims Under Appeal
denied claim that's being appealed may not convert the account to 'past-due' status until the final appeal decision has been received.
Each practice sets its own procedures for collections process.
30 days.............bill patient 45 days.............call patient regarding bill 60 days.............letter 1 75 days.............letter 2 & call 80 days ............letter 3 90 days..............turn over to collections
professional courteous, breif & to the point; Letter is first notice that their bill is past due. Gradually become more aggressive in wording.
Methods of Collections
Collections Letter (s) Collections Calls Documentation (specialists use abbreviations for common call results & situations)
Credit Arrangements & Payment Plans
Two federal laws govern payment arrangements: 1. Equal Credit Opportunity Act (ECOA) 2. Truth in Lending Act
Equal Credit Opportunity Act (ECOA)
prohibits credit discrimination on the basis of race, color, religion, national oirgin, sex, marital status, age, or because a person receives public assistance. (enforced by FTC)
Truth in Lending Act
law requiring disclosure of finance charges and late fees for payment plans;
A practice may decide to extend credit to patients thu a PAYMENT PLAN that lets patients pay bills over time, rather than in a single payment.... practices may charge interest on these plans... terms must be agreed on by both parties.
Truth in Lending Act as it applies to Payment Plans
all terms must be disclosed and agreed upon before arragnement is finalized. If interest charged, or 4+ payments to be made plan is governed by TRUTH in LENDING ACT... part of the consumer Credit protection Act.
Credit Counseling & Debt Management programs
nonprofit organizations that can assist patients who are struggling to pay their bills or who have a great number of different bills; they contact creditors to work out payment plans at reduced costs to patients.... only 1 monthly payment made & then divided among creditors as agreed.
Payment Plan Design
practices have guidelines for appropriate time frames and minimum payment amounts for payment plans.
payment before major expensive procedures are performed... downpayment made & then monthly postpayments set up.
Collection Agencies and PHI
agencies must agree to follow practice's security & privacy policies to protect patients' PHI. - Employees of Coll. Agencies must sign confidentiality agreements regarding PHI
When to Use a Collection Agency
- All attempts to contact patient have been unsuccessful & patient hasn't responded to letters or calls - patient says they won't pay a bill - bad check for lack of funds - defaults on payment plan - outdated patient contact info./ can't be located - patient receives payment for service from insurance company & hasn't paid provider
Notice of Privacy Practices (NPP)- and Collections
explains practice's policy on when accounts are sent to an outside collector.
be careful choosing... they represent the Practice. Choose a fair, ethical agency. ; Cost efficient way to retrieve some/all unpaid balances to cover some of practice's fees.
Types of Collection Agencies
Local, regional or national scale; Local or regional understand patient's demographic surroundings National has more tools to locate/contact debtors, often at lower cost
analysis of a person's credit standing during the collections process.... supplied by credit bureau for a cost.... shows record of unpaid bills/debt regulated by law under the Fair Credit Reporting Act (FCRA) and the Fair and Accurate Credit Transaction (FACTA)
organizations that supply information about consumers' credit history
Fair Credit Reporting Act (FCRA)
law requiring consumer reporting agencies to have reasonable and fair procedures
Fair and Accurate credit Transaction Act (FACTA)
laws designed to protect the accuracy and privacy of credit reports. Amended FCRA in 2003.
FCRA and FACTA
designed to protect privacy of credit report information.
Red Flags Rule
law stating that health care entitles must estabilsh reasonable policies and procedures for implementing the identity theft guidelines.
Red Flags Rule
result of FACTA, Fair & Accurate Credit Transaction Act; focuses on prevention of identity theft. Enforced by FTC
means a pattern, practice or specific activity that indicates the possible existence of identity theft.
Examples of red flags
alerts or warnings from consumer reporting agencies, suspicious personal identifying information and documents (photo ID),
process of locating a patient who has an outsanding balance.
Methods of Skip Tracing
Tracing a Debtor (practice searches) Professional Skip Tracing Assistance (for large practices) Computerized Skip Tracing (online directories & databases- less expensive) Effective Skip Tracing Calls
Patient Account deemed uncollectible...
Uncollectible Account / Write-off account
monies that cannot be collected and must be written off / practice must determine which debts to write off in the PMP and whether to continue to treat the patients.
process of fairly determining a patient's ability to pay... patient fills out a form and their income tax forms are reviewed, along with credit reports.
declaration that a person is unable to pay his or her debts / another reason for write-off.
Dismissing patients who do not pay
physician has the right to terminate the physician-patient relationship for any reason under the regulations of each state.
money that needs to be returned to patients when the practice has overcharged a patient for a service;
Patients' refunds or credit balances
are handled differently than insurance overpayments, which must be refunded to the payer.
practice policy goerning the handling and storage of patients' medical records. List of items from a record that are retained & for how long.
patients' medical recorrds & financial records retained per practice's policy. Federal laws, HIPAA and FACTA regulations also apply.
protects both the provider & the patient; record must be available for anyone within or outside of the practice who is caring for the patient. - kept in case of legal proceedings
American Health Info. Management Assoc. publishes guidelines called practice briefs on many topics including retention of health information.