The healthcare insurance industry is in somewhat of a flux at the moment, which can cause problems for any practices that aren’t paying careful attention to what’s going on. For example, patients are being held more responsible for health insurance costs than insurance payers, which is evidenced by the rising co-payments and deductibles.
This can be a problem for medical practices due to the fact that patients tend to pay much slower than insurance payers, which means that if they aren’t careful, their cash flow could decrease.
Preventing Cash Flow Problems
Because patients are being forced to pay higher costs, it means that more of your cash flow is dependent on your patients than on insurance companies. According to the National Center for Health Statistics, 25% of families have an unpaid healthcare bill, 10% of families have medical bills they can’t pay at all and 20% are on a payment plan to pay off their bills over time.
As you can imagine, this could affect your cash flow drastically, especially if the co-payments and deductibles of your patients continue to go up. Fortunately, there are a few steps that you can take to help keep your cash flow from declining. The following are a few such steps:
Collect payment upfront – Don’t allow patients to pay after their appointment. Make it a practice to require payments up front. Have a sign that states this and post it on your website. Make sure your staff reminds your patients that they will need to pay their co-payments whenever they call them to remind them about their scheduled appointments.
Take multiple forms of payment – To encourage patients to pay what they owe upfront, offer them a number of ways to pay, such as with cash, by check, by credit card or by debit card. This way, your patients can’t use the excuse that they don’t have cash on hand to pay.
Keep patient credit card info on file – One way that you can reduce unpaid medical bills is by keeping patients’ credit card information on file and getting them to agree to allow you to automatically bill their card for what they owe. You will need permission to do this, of course, and you’ll have to make sure you take security precautions to keep their credit card information safe.
Provide an incentive for paying upfront – Some patients may try to pay later. While this is preferable to not being paid at all, you can get some of these patients to pay upfront with incentives, such as a small discount for paying before their appointment instead of after.
These are a few tips to help prevent cash inflow problems. But there are also cash outflow issues you should look into as well. The following are a few ways you can limit cash outflow:
Analyze your staff – Figure out how much time your staff spends working. If they have a lot of downtime, then you may be overstaffed.
Outsource billing and collections – Outsourcing medical billing and collections services can help to not only improve your collections, it could allow your office to run much more efficiently and effectively, and may even allow you to reduce some of your staff.
These are just a few ways that you can improve your cash flow and prevent potential cash flow problems that might arise as the healthcare insurance industry is in the midst of potential change.