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Debt Collection in Healthcare: Part I

Debt Collection in Healthcare: How to Collect Debts Efficiently and Legally

Collecting money owed to your organization can be an exercise in frustration if you’re not familiar with strategies that get results and keep you legally compliant with government guidelines. This three-part series will help you make changes in your debt collection policies and procedures to increase effectiveness, aid you in collecting debt right now, and educate you about the Fair Debt Collection Practices Act (FDCPA).

PART I: Changes you can make in your debt collection policies and procedures.

Make sure you get all the facts. · Collect ample and accurate patient information during the admissions process. · Get the work information, address, phone number of the patient AND the information concerning the person checking them in or signing as the responsible party. · The more information you can get, the better for collection purposes. · The more points of contact you can establish with the patient’s family or caretakers, the better. If the account becomes delinquent, this will aid collection efforts.

Consider different payment options. · Checks · Cash · Credit Cards · Debit Cards · Automatic Bank Draft

Solutions for checks bouncing: · Credit Reporting services such as Equifax · Service such as Telecheck or other providers that utilize leading risk assessment technology, extensive check writer negative and activity databases to evaluate the risk of accepting a check.

Daily Practice pointer for checks: Scan or copy each check received from a patient. This ensures that you have access to account information contained on the check should the check bounce or the account later become delinquent. For instance, this information can be used for garnishment of the account.

What is Risk Assessment Technology? · Services use leading risk assessment technology, extensive check writer negative and activity databases to evaluate the risk of accepting a check. · Some companies offer verification and warranty service options so you can determine the risk coverage level that is right for your organization. · Electronic check acceptance (ECA), checks can be converted to electronic transactions at the POS to streamline processing and get you the money you are owed faster.

Advantages of using a Risk Assessment system: · Make fewer trips to the bank. · Reduce bank fees and processing costs. · Improve cash flow and operational efficiencies. · Streamline back office operations. · Reduce the risk of lost, stolen or damaged checks. · Protect your customers’ personal information.

Pre-Authorization of Credit Card: Consider adding a provision to the payment policy which give the facility the right to hold a credit card number and to charge that card in the event that the account becomes more than 30 days past due.

Credit Checks: Consider adding a provision to the agreement or a separate agreement, which authorizes the facility or its agents to conduct a full credit check at the time of admission or if the account becomes delinquent by over 30 days.

Advantages of using an Automatic Bank Draft:

For Your Business · Enhanced customer service through a non-interest bearing payment option. · Saves your business money compared to paying credit card fees. It is much more cost-effective to have customers utilize the automatic bank draft option because it is set as a flat fee, NOT a percentage like credit card fees. · Helps managers lower A/R percentages. · Reduces billing and collection letters. · Reduces collection work for managers so they can focus on new business.

For Patients and their families · Convenient · Less worry. Life is stressful enough without the worry of paying bills on time. · No phone tag. · No late fees. · No reminder calls. · No credit card interest. · No costly last-minute trips to deliver payment.

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