Collections and Collection Agencies
Setting up clearly written financial options for patients before beginning treatment is the only way to eliminate most collection problems. When patients understand what is expected of them, they are more compliant in paying when payment is due. There are fewer misunderstandings that lead to heated phone calls about statements received after treatment is complete.
Financial options should include a financing company such as CareCredit that will allow the patient to make affordable monthly payments based on their credit score and credit worthiness.
Recently, I have received inquiries as to what to do with patients who owe under $100.00 when phone calls and statements have been ignored for 90 days. The patients in question have received a course of treatment and have paid most of the fee or have insurance that has already paid per contract. For the most part, these patients have been compliant in the past. Because sending a patient to a collection agency has negative implications for both the patient and the practice, it is wise to take a different approach on small balances. In the past I have used what I call a “compassion letter” for patients that owe small balances. When patients owe the practice money, they usually don’t return to the practice until the bill is paid. Some patients are angry that the practice is “hounding” them for such a small amount and they may make disparaging remarks about the practice to friends and neighbors to justify non-payment. The compassion letter is an unexpected random act of kindness that can often result in payment. The letter reads as follows:
Write Off Compassionate Letter
After repeated attempts to communicate with you by statement and by telephone regarding your overdue account, I have decided to write off the amount of ________ (money) that you owe Dental Practice (name). I do this with the understanding that financial problems can happen despite best intentions. Should you decide to return to our office, we require that you pay your past balance to reinstate your account.
For now, your record will be inactivated and my business manager will be happy to forward your dental records to your new dentist if you wish. Please do not postpone regular visits to your dentist as this will only create larger more expensive health problems in the future. I have enclosed some educational information that I feel may be of help to you.
Before using a collection agency, consider the following:
It is important to schedule regular reminders before considering a collection agency. This will not only help save money, but will also avoid the negative outcome that can be generated when using a third party to collect the funds.
As a final step, set an absolute due date before the account is turned over to a collection agency. Do not extend this date, but do give the debtor warning of this final payment date.
How Agencies Work
Choosing a Service
Method of collection
How the service will work with you
Reputation of the firm
Make sure the agency you choose is licensed
To avoid collection problems by improving communication and improving cash flow by setting up financial payment systems in your practice, consider training your front office team with one of McKenzie Managements’ Advanced Training Programs.
If you would like to learn more about McKenzie Management’s Advanced Training Programs, email: email@example.com.
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