12.19.14 Issue #667 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter

Belle DuCharme, CDPMA
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Positive Change in Collections for 2015
By Belle DuCharme, CDPMA

“Our patients will walk out the door if we ask them for money.” This blanket statement meant to derail or cancel out good financial arrangements is not true, but often used as an excuse by some dental office workers. Instructing dental business systems for almost a dozen years has taught me that people will make excuses for and defend what they are doing when it doesn’t work, because they don’t know what else to do. They have been scripted by fear and failure to accept mediocrity in job performance.

In Stephen R. Covey’s book The 7 Habits of Highly Effective People, he writes about the third character trait essential to “win-win” as the Abundance Mentality. Scarcity Mentality is a thought process that says you can have only so much and there isn’t enough to go around. If you buy into the notion that not every patient wants to pay or should have to pay for services when provided, you share the Scarcity Mentality. Operating in fear of losing patients because you ask for payment is absurd. Offering a 3-5% reduction in fee for services paid in full at the time of treatment ($300 or more) is an incentive to pay and also says payment is expected.

The Abundance Mentality, states Stephen R. Covey, “flows out of a deep inner sense of personal worth and security” and “there is plenty out there and enough to spare for everybody.” If you think you will lose patients if you ask them to pay at the time of service, then you might – if they haven’t been informed prior to treatment of their payment responsibility. On the other hand, if you treat your practice as a business that provides excellent dental care and customer service like any other business, then you collect for services as rendered. Even when dealing with third party payers that you have contracted, there is nothing that says you don’t collect the patient portion at the time of service. The arrangement for payment of your services by an in-network provider or out-of-network provider requires that the patient participate in costs by paying their estimated share and applicable deductibles. As a provider it is your contractual duty to make every effort to collect the patient’s share or possibly be audited for the return of insurance monies.

A recent survey from the Commercial Collection Law League of America estimates that practices routinely recover 93.8% of their receivables if collected in 30 days or less, 73.6% of receivables in 90 days past due, 57.8% of receivables in 189 days past due, and only 26.6% if the receivables go past a year. The longer the money is on the accounts, the less it is worth, and the more time and energy it takes to track down people and get a commitment to pay what they owe you. Another study shows that when patients owe you money, they don’t come back for further treatment until the debt is paid – all the more reason to collect at the time of service.

Communicating with patients about their proposed treatment, including total costs, estimated insurance participation and their estimated share, along with instructions as to when it is due and the options they have to pay, will set the ground rules for how payment is handled in your office. Without a system in place, the patient will direct you in how they want to pay, which usually results in your accounts receivables going up while your collection activity to recover the money is put on the back burner.

This year, make some positive changes in how you present financial arrangements and eliminate the high accounts receivables you struggle with now. When a patient wants monthly payments, remember not to carry these unpaid accounts on your books. Have the patient apply for a line of credit with CareCredit to get the account paid to you in full (minus a fee).

Want a better year in 2015? Stop the negative and get positive results. For help, call us today for customized training in financial, insurance and collection techniques which will improve your bottom line and bring harmony to your practice.

If you would like more information on McKenzie Management’sTraining Programs  to improve the performance of your team, email training@mckenziemgmt.com

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