AR Logix Healthcare Revenue Cycle Blog

FAQ: When Can I Send a Patient to Collections?

Posted by Ali Bechtel on Mar 5, 2015 11:02:47 AM

The increase in cost of medical collections over time

FAQ:

When can I send a patient to collections?

Answer:

You can send a patient to collections at any time. Payment for services rendered is due at time of service or shortly after patient responsibility determination. 

Best Practices:

There is no written law requiring private healthcare organizations to provide a certain time period or number of notices to a patient with a delinquent account prior to sending them to collections.

It is not recommended to send a patient immediately to collections if they do not pay their balance in full within a few days of their visit. However, allowing a patient to wait 60, 90 or even 120 days before communicating with you about their bill is also not suggested. Because people pay their bills emotionally, it is necessary to discuss their balance with them while your services are still important to them. It is important to determine the right balance of time for your practice, and to commit to it.

Patients have been taught that they do not have to pay their medical bills right away. Many practices give discounts after a certain period of time to encourage payment or include an aging bar on their patient statements. While an aging bar may appear to be a reminder to the patient that their balance is overdue, what it is really telling them is that your healthcare organization will wait up to the maximum number of days on that bar before taking any action.

"Nearly 75% of best performers start collection follow up in less than 30 days from discharge."

- American Hospital Association

The older a delinquent account becomes, the less likely it becomes that your practice will collect on it. Review the payment histories of your patients and determine the right amount of time for your practice to wait before sending a patient to collections. Best practices suggest following up with the patient by phone rather than just sending statements. According to the American Hospital Association, “nearly 75% of best performers start collection follow up in less than 30 days from discharge, and 50% of best performers start follow up by phone in less than 20 days from service.”

With the rise in patient responsibility under the Affordable Care Act it is more important than ever to communicate with patients and to help them understand their balance. Often when they receive a statement or an explanation of benefits and they do not understand what they owe, which makes them less likely to pay. For a full free guide to collecting higher balances from patients, download our eBook.

Once you have decided upon a timeline, include it in detail in your practice’s financial policy so that your patients understand what is expected. Finally, update your patient statements and notices and commit to monitoring each patient’s account to ensure your financial policy is being complied with.

Need a little help getting started? Visit our resources page for sample patient statements, notices and financial policies, and webinars to help you optimize various stages of your revenue cycle.

Not sure where to start in finding the right agency for your practice? AR Logix Inc.’s third-party medical collections program, Berk's Credit Collections, offers competitive rates and industry-leading liquidation. Our FDCPA and HIPAA-trained representatives work exclusively within the healthcare industry and take a nonjudgmental approach to collecting from your patients, so you can maintain your relationship with them while improving your revenue. For more information and rates, contact us today!

Want to keep this information handy? Download the Fact Sheet for this article here.

Download the Collecting Higher Patient Responsibility eBook Today!

Written by Ali Bechtel, Public Relations Coordinator

This information is not to be construed as legal advice. Legal advice must be tailored to the specific circumstances of each case. Although we attempt to provide up-to-date information, laws and regulations often change. We make no claims, promises, or guarantees about the accuracy or completeness of this document. For legal advice, please consult an attorney.

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