With ongoing healthcare staffing shortages, many hospitals struggle to follow up with unpaid patient balances. Unfortunately, this can cause a domino effect of aging accounts receivable (A/R) which often becomes bad debt. When hospitals do have the resources to follow up with unpaid patient A/R, their focus is typically on high-dollar accounts, leaving lower-value balances overlooked.
The problem with a high-dollar strategy is over time, and with increased volume, low-dollar accounts add up—sometimes even exceeding the total dollar amount associated with a smaller volume of high-dollar balances. In addition, a new rule from the Consumer Financial Protection Bureau prohibits the inclusion of medical debt on credit reports. Hospitals may struggle if they rely on credit reports to encourage voluntary payments, as it’s unlikely to be persuasive for much longer. When thinking about how to collect patient balances, hospitals need a more reliable and consist approach.
A proactive strategy to collecting low-dollar A/R balances is critical. By ignoring them, hospitals may miss opportunities to significantly boost revenue and improve overall cashflow. As hospitals examine how to collect patient balances more effectively, the three steps below can help move the needle on low-dollar A/R amounts.
1. Define a threshold and quantify the potential impact. By determining a threshold, hospitals can easily classify accounts that fall below this specified amount. Totaling the dollar amount of these accounts provides hospitals with the potential impact of revenue recovery. With that being said, it’s just as important to examine days in A/R because it may be more difficult (but certainly not impossible) to collect on older, low-dollar A/R balances.
2. Evaluate internal processes. Hospitals must ensure the cost to collect does not exceed the amount recovered. Here are five ways to do that:
3. Consider an outsource partner. Outsourcing A/R follow-up—particularly for low-dollar A/R balances—is often the most cost-effective way for hospitals to recoup revenue. Why?
The new medical debt-credit report rule could present a whole host of patient collection challenges for today’s medical practices. Partnering with the right revenue cycle management vendor sets providers up for success during uncertain times. Learn how Global Healthcare Resource can help.
Our revenue cycle and patient call center professionals operate as an extension of your team, Here’s how it works:
Step 1: Schedule a meeting to discuss your scope of work and current challenges.
Step 2: Global assembles, trains, and manages a team of highly skilled professionals to work on your project only.
Step 3: In an average of 30 days, your team is fully ramped up and operating at your designated benchmarks and KPIs.
