Financial Administration Unit 5 Financial Administration

Fees, Credit, and Collection Chapter 13 Fees, Credit, and Collection

Objectives Review the learning and performance objectives for this chapter By the end of this chapter, demonstrate the procedures in the textbook and the job skills in the workbook

Heart of the Health Care Professional Service Answering questions and explaining fees is a courtesy to the patient

History of Credit Credit Latin word credere To trust or to believe Personal integrity Ability to meet financial obligations

History of Credit The Great Depression Today Start of credit for medical services Today Payment expected at time of service Health insurance contract Debit and credit cards used

History of Credit Credit and Collection Information Complete, accurate registration Personal information Financial history Review before patient leaves office Includes insurance information Used to bill insurance company

Fee Schedules “Quantum merit” Fee Schedule: List of Fees for Services “As much as he deserves” Fee Schedule: List of Fees for Services Required by federal regulations Separate schedules allowed in some states Workers’ compensation Medicare/managed care Private pay

Fee Schedules Every physician establishes fees Considerations: Medical specialty Education Experience Geographic location Overhead costs

Fee Schedules Concierge Fees Medicare Fees Retainer-based medicine Opt out of insurance programs Medicare Fees Participating fee Nonparticipating fee Limiting charge See Example 13-1

Fee Schedules Changes in Fees and Discounts Hardship discounts Dependent on income level Hill-Burton Act (hospital) Professional courtesy Waive or reduce fees Copayment waiver Not recommended

Fee Schedules Fee Splitting One physician pays another for referrals Unethical and felony in some states Medicare and Medicaid have antifraud and abuse provisions against this practice

Fee Schedules Discussing Fees State fees, answer questions Fee-for-service collected at time of visit Copayment collected at visit Guidelines for Communicating Fees State clear and accurate See Example 13-3

Fee Schedules Discussing Fees Signs of a “deadbeat” Incomplete registration form Questionable employment record No business or home telephone Many moves of residence or Motel address Record of doctor hopping No referral No insurance

Billing Payment at Time of Service Emphasize options and incentives to patient See Example 13-4 Meeting with patient Face-to-face Discussion of outstanding balance

Billing Multipurpose Billing Form Combination bill Insurance form Routing document Receipt May be computer-generated

Billing Multipurpose Billing Form Other names: Charge slip, communicator, encounter form, fee ticket, patient service slip, routing form, superbill, transaction slip

Billing Monthly Itemized Statement Computerized bill sent to patient Balance bill

Billing Ledger card Charges, payments, adjustments, balance owed Explain Professional Fees in an Itemized Billing Statement Procedure 13-1

Billing Cycle Billing Billing distributed throughout month Account number Insurance type Date of first service

Billing Cycle Billing Allows continuous cash flow Distributes related duties Prepare and Post to a Patient’s Account Procedure 13-3

Billing Credit Card Billing Debit Cards (Check Card) Patient pays fee with credit card Patient billed by credit card company Debit Cards (Check Card) Off-line (electronic check) On-line (PIN)

Billing Smart Cards Individual Responsibility Program (IRP) Like debit card; embedded with programmable microchip Individual Responsibility Program (IRP) Patient pays physician Insurance reimburses patient

Billing Billing Services Prepare Monthly Itemized Billing Statements Business that handles sending statements Saves office money and time Prepare Monthly Itemized Billing Statements Procedure 13-4

Billing 1. Itemized fees for professional services with line-by-line description. 2. Insurance claim submitted showing dates or service billed. 3. Payment received on account from insurance, listing voucher number. United paid 80 percent. 4. Billed patient 20 percent copayment. 5. Patient’s payment check received, listing check number.

Credit and Collection Laws Fair Debit Collection Practices Act (FDCPA) Guidelines for collection practices Equal Credit Opportunity Act If credit extended to one patient, it must be extended to all who request it

Credit and Collection Laws Federal Truth in Lending Act Governs all who charge interest and agrees to more than four payments Interest rates governed by state laws “Regulation Z” disclosure form for payment plans Establish a Financial Agreement with a Patient Procedure 13-5

Credit and Collection Laws Truth in Lending Consumer Credit Cost Disclosure Disclose: All costs Interest, late fees Prior to time of service

Credit and Collection Laws Fair Credit Billing Act Patient: 60 days from statement to complain of error Provider: acknowledged within 30 days Provider: 90 days to correct Fair Credit Reporting Act (FCRA) Accuracy and privacy in consumer reports

Credit and Collection Laws Credit Bureaus Noninvestigative consumer credit reports Applying for credit Investigative reports Requested by insurance companies, employers, credit grantors, and others Physician can join credit bureaus Obtain information over telephone

Collections Three Types of Accounts Aging Accounts Open-book account Written-contract account Single-entry account Aging Accounts Breakdown of days overdue 30, 60, 90, 120

Collections Office Collection Problem Solving Credit counseling Verifying checks Nonsufficient funds Bad check preventive measures Red Flags Rule

Collections Office Collection Problem Solving Dun messages Dun: “to make a loud noise” Payment reminder phrases

Collections Telephone Collections Perform Debt Collection Using a Telephone Procedure 13-6 Insurance check sent to patient Assignment of benefits

Collections Collection Letters Form letter Letter with checklist Personally composed letter Solutions for payment excuses

Collections Collection Agencies Select Collection Agency Procedure 13-7 Take Collection Action, Write Off an Uncollectable Account, Then Post Money from a Collection Agency Procedure 13-8

Collections Small Claims Court Inexpensive Judgment by court Physician has to pursue payment File an Uncollectible Account in Small Claims Court Procedure 13-9

Collections Federal Wage Garnishment Law Estate Claims Attaching debtor’s property or wage Estate Claims Claim on estate of deceased patient

Collections Bankruptcy Chapter 7: straight petition bankruptcy Chapter 13: wage-earner’s bankruptcy Debtor protected by court Creditor cannot send further statements

Collections Tracing a Skip Search via Computer Patient owes balance, moves, no forwarding address Procedure 13-10 Search via Computer Internet search using electronic databases

Stop and Think Case Scenarios Review the scenario “Tackle Payment Obstacles” Determine what your response should be

Stop and Think Case Scenarios Review the scenario “Handle Collection Problems” Formulate questions to ask the patient and state what action you will take