tion because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limit

Debt collection from patients is a conflict doctors often prefer avoiding for fear of potential implications to practice reputation and increased exposure to malpractice lawsuits. Healthcare debt collections require unique combination of sensitivity, skill, and discipline. Understanding of debt collections process and outsourcing opportunities help the practice owner improve revenue cycle while minimizing practice risks.

The best way to improve the patient payment component of the revenue cycle is to collect cash payment in advance for healthcare services. However, without solid processes and disciplined implementation, upfront cash collection can challenge and frustrate front office staff, often contributing to accumulation of outstanding patient debt. Insurance companies sending payments directly to patients instead of the office further exacerbate the difficulties of debt collection.

A typical debt-processing scenario proceeds in three phases, starting with billing, to debt accumulation, to selection of the most appropriate collections method. Clear definition of responsibilities along with payment arrangements help effective collections, minimize practice risks, and reduce administration costs.

Billing Phase: Your billing office sends patient invoices and a number of reminder invoices regarding outstanding balance directly to the patient.

Debt Accumulation Phase: The patient does not pay the invoice for a time period exceeding desired limit (typically, 90-120 days). Accounts receivable distribution over the span of 30, 60, 90, and 120 days takes the shape of inverted horizontal S.

Debt Collections Phase: The practice must consider at least four alternatives for outstanding debt collection:

1. Dismiss the patient until all debt is paid.
2. Offer the patient the opportunity for a financial hardship write-off.
3. Take the patient to small claims court.
4. Hire debt collections agency.

First, dismissing a patient is not always an appropriate option because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limits

cash payment in advance for healthcare services. However, without solid processes and disciplined implementation, upfront cash collection can challenge and frustrate front office staff, often contributing to accumulation of outstanding patient debt. Insurance companies sending payments directly to patients instead of the office further exacerbate the difficulties of debt collection.

A typical debt-processing scenario proceeds in three phases, starting with billing, to debt accumulation, to selection of the most appropriate collections method. Clear definition of responsibilities along with payment arrangements help effective collections, minimize practice risks, and reduce administration costs.

Billing Phase: Your billing office sends patient invoices and a number of reminder invoices regarding outstanding balance directly to the patient.

Debt Accumulation Phase: The patient does not pay the invoice for a time period exceeding desired limit (typically, 90-120 days). Accounts receivable distribution over the span of 30, 60, 90, and 120 days takes the shape of inverted horizontal S.

Debt Collections Phase: The practice must consider at least four alternatives for outstanding debt collection:

1. Dismiss the patient until all debt is paid.
2. Offer the patient the opportunity for a financial hardship write-off.
3. Take the patient to small claims court.
4. Hire debt collections agency.

First, dismissing a patient is not always an appropriate option because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limit

t appropriate collections method. Clear definition of responsibilities along with payment arrangements help effective collections, minimize practice risks, and reduce administration costs.

Billing Phase: Your billing office sends patient invoices and a number of reminder invoices regarding outstanding balance directly to the patient.

Debt Accumulation Phase: The patient does not pay the invoice for a time period exceeding desired limit (typically, 90-120 days). Accounts receivable distribution over the span of 30, 60, 90, and 120 days takes the shape of inverted horizontal S.

Debt Collections Phase: The practice must consider at least four alternatives for outstanding debt collection:

1. Dismiss the patient until all debt is paid.
2. Offer the patient the opportunity for a financial hardship write-off.
3. Take the patient to small claims court.
4. Hire debt collections agency.

First, dismissing a patient is not always an appropriate option because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limit

tion over the span of 30, 60, 90, and 120 days takes the shape of inverted horizontal S.

Debt Collections Phase: The practice must consider at least four alternatives for outstanding debt collection:

1. Dismiss the patient until all debt is paid.
2. Offer the patient the opportunity for a financial hardship write-off.
3. Take the patient to small claims court.
4. Hire debt collections agency.

First, dismissing a patient is not always an appropriate option because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limit

tion because of associated reputation implications and potential medical malpractice risk. More importantly, dismissing the patient only stops subsequent debt accumulation but does not eliminate the already accumulated debt.

Next, financial hardship write-off may not be feasible as some patients refuse or are ineligible for it.

Third, a small court can help collections only from patients with steady work and debt under $5,000, upon paying a typical $75 processing fee. Keep in mind that a small court limits its scope to liens and/or wage garnishments instead of actually making collections.

Finally, a specialized collection agency with thorough understanding of the claim payment process and result-oriented and accountable approach to customer service recovers on average 15% of outstanding debt.

Key debt collections agency selection issues revolve around industry knowledge, performance, control, costs, and interaction between billing and collections services:

1. Specialized Industry Expertise
   • Compliance and Certification. HIPAA-compliant medical record processing and legal compliance with federal and state collections regulations.
   • "Skip-tracing." Ability to find patients that changed addresses or names
   • Access to Special Funding Sources. Experience of working with specialized public and private funds for victims of accidents and violence
   • Relevant Legal Expertise. Access to specialized legal expertise and ability to handle both small and large debt cases in court
   • Understanding of Billing Processes Knowledge of healthcare claims processes and ability to successfully negotiate with insurance companies

2. Proven Performance
   • References. Provide a list of specialty-relevant references.
   • Quantitative Performance Measurement. Compare collections performance including percent collected and time to account liquidation.
   • Client satisfaction. Demonstrate long client retention history.

3. Centralized Control
   • Transparency. Provide real time status on all collection activities, including amount collected, actions taken, and patient responses. Include a wide selection of reports available over a secure Internet connection 24 x7.
   • Tight Cash Flow Control. All collected money goes directly to your practice or bank account, increasing positive cash flow and immediately col