SETTLE UP With today's high-deductible health plans, your business office staff must excel at point-of-service collections.

With patients paying more out-of-pocket than ever before, collecting deductibles and co-pays on the day of surgery has never been more critical to a healthy revenue stream. At our physician-owned center, where 40 ? of every $1 come from point-of-service collections, here's how we (try to) get every penny patients owe before we wheel them back for surgery.

• Ask patients how (not if) they'll pay. When you call patients in the days before surgery to go over their deductible and co-pay, ask them how they intend to pay, not if they can pay. Training your business office staff to ask "How will you be paying?" instead of "Can you pay?" lets patients know that you expect them to pay what they owe at check-in. This little bit of verbal judo really helps. Studies have shown that consumers are less likely to pay after receiving a good or service, so you'll have a hard time getting your patients to pay up after their incisions have healed. We've conditioned patients to not worry about paying upon arrival — or departure — for health care. Undo that way of thinking so that patients know they have to pay while they're in your facility. When you make it a matter of how will you pay, not if you can pay, your staff will run more credit cards at the registration desk and chase down fewer delinquent accounts.
• Understand your patient's plight. Despite its name, the Affordable Care Act is not so affordable. Thanks to Obamacare, more Americans have health insurance, but fewer can actually afford to use it. As insurers shift more of the burden for health costs to patients, healthcare providers used to getting paid on the back end from government and commercial insurers must now collect hundreds and sometimes thousands of dollars up front from patients. But cost-sharing health plans are also a burden for patients, some of whom must pay $10,000 or more in deductibles before their insurance kicks in, and hundreds more in co-pays. Even the relatively modest co-pay for cataract surgery — $193 in an ambulatory surgical center and about $361 in a hospital outpatient department — can be a financial hardship for some.

Don't ask patients if they can pay at check-in. Ask how they intend to pay.

• Calculate what patients owe. Not only can the patient's out-of-pocket cost be the size of a monthly mortgage payment, but it can also be confusing to figure out. While most patients who don't pay their portion on the day of surgery can't afford to, others simply aren't aware of what they owe — or even that they owe — because they're confused about how their insurance works. Don't assume patients will know how much they owe on their deductible or even what their co-pay is. Assign one of your business office staff to compute what each patient's responsible for and then communicate that amount days in advance of surgery. Sometimes you won't know the exact amount patients owe until after the procedure is completed, but you can at least come up with a pretty good estimate. This requires some math and some digging.

First, contact the patient's insurer to find out 4 things: his deductible amount, how much has been met, the co-insurance and the out-of-pocket limits. Next, refer to your fee schedule to get the insurance-allowed amount for the CPT code. To make this process more efficient, I've requested a fee schedule from each of our 18 payers and entered each into an Excel file. The spreadsheet includes a list of payers, CPT codes and their descriptions, and the contracted rate that we've negotiated with each insurer.

Here's an example of how to calculate the patient portion. Let's say your contracted rate with Aetna for CPT code 42826 (tonsillectomy) is $1,700. The patient has a $1,500 deductible (that he's met none of) and an 80/20 co-insurance, meaning he pays 20% up to an out-of-pocket limit of $3,000. The patient portion would be $1,540, a figure you get by subtracting the $1,500 deductible from your $1,700 contracted rate, and then applying the 20% co-pay to the remaining $200 ($40).

Mention to patients that you've made every effort to be as accurate as possible when calculating their portion, but that they're responsible for any amount if their insurance plan doesn't cover as much as you've estimated.

• Put patients on a payment plan (but only if you must). Whatever the reason, sometimes you'll have to put patients on a buy-now, pay-later payment plan or let them finance their out-of-pocket responsibility — but only after you've made every effort to get them to settle up with cash, check or credit card on the day of service. My suggestion: Don't even mention the possibility of monthly installments unless a patient asks about a payment or a finance plan. If you give patients the option to pay now or to pay later, most will put it off.

Our payment plan is straightforward and reasonable. Patients must put 50% down at the time of service with 2 additional automatic payments of 25% of the balance a month apart either by credit or debit card, or by automatically deducting the amount from the patient's checking account. For example, if the patient portion is $500, we'll accept $250 at the time of service and then split the balance into 2 payments: $125 in 30 days and $125 in another 30 days. This way, we're paid in full in 3 months (we tack on a 10% interest fee to the balance for accounts older than 90 days). In rare instances, we'll let financially strapped patients take up to 6 months to pay.

If a patient doesn't agree to automatic withdrawal, we don't accept the payment plan. Be sure the patient leaves a copy of his debit or credit card so you can process the payment at the beginning of every month. For electronic transfer from a checking account, known as an ACH (Automatic Clearing House) withdrawal, the patient must provide you with his checking account number and routing number.

We also let patients use a healthcare credit card to pay for out-of-pocket expenses that aren't covered by their health plans. This financing option is quick and clean. It pays us upfront and in full, and bills patients separately.

How are we doing?
Surgical facility managers now face a new financial reality, one in which almost as much of our revenue comes from patients as from insurers. We collect the patient's full out-of-pocket costs about 60% of the time and a half of what they owe about 40% of the time. Not bad, but we can do better. OSM