Most Overlooked Way to Increase Practice Cash Flow

As they say, “cashflow is king”. Cashflow is the single biggest financial factor in a business. Cashflow is simply, “cash-in-hand” as opposed to what you may receive in the future. In this challenging economic environment, practices are looking to improve cashflow. One powerful way to increase cashflow is to collect patient payments at the time of service. In addition to improving cashflow, practices can reduce administrative costs, and provide a better patient experience. But before discussing the importance of collecting patient balances, let’s first understand what is included in a patient’s balance.

Patient balances typically consist of several different types of charges, including:

  1. Deductibles: This is the amount that a patient must pay before their insurance begins to cover their medical expenses.

 

  1. Copayments: This is a fixed amount that a patient must pay for each doctor’s visit or for each prescription drug.

 

  1. Coinsurance: This is the amount that a patient must pay for their medical expenses after their insurance has paid its share.

 

  1. Uninsured services: This includes services that are not covered by a patient’s insurance, such as cosmetic procedures.

Let’s consider all of the advantages of collecting patient balances at the time of service:

Increased likelihood of getting paid: It is important that you collect payment upfront. If you do not collect payment at the time of service, the likelihood of ever collecting it decreases. This occurs for many reasons. Patients may not remember what they have to pay for. They may assume that this is something insurance will cover. It is also possible that other financial priorities have emerged in their lives. They may also not pay attention to bills.Patients may also not understand why it was not collected at the time it was due if they truly owed that amount. After all, that is how payment for other things in their lives work.

  1. Cash flow improvement: When you collect patient balances at the time of service, you receive payment immediately, which improves your cash flow. This allows your practice to have a more consistent and predictable flow of revenue, which is critical for managing your financial stability.

 

  1. Reduced administrative costs: When patient balances are not collected at the time of service, practices must follow-up with patients for payment by sending patient statements, making phone calls, using collection agencies, and other efforts. This is time-consuming and increases administrative costs. By collecting balances at the time of service, practices can save time and money and reduce the need for additional staff.

 

  1. Better patient experience: Collecting patient balances at the time of service also provides a better patient experience. Patients can receive a clear explanation of their financial responsibility, understand what they are paying for, and they can take care of their payment obligations during their visit, which reduces the likelihood of receiving future patient billing, statements, and collection efforts. This transparency and clarity improvespatient trust, promotes patient loyalty, and increases patient retention.

How can you implement collecting patient balances upfront in your practice? Here are a few steps you should consider:

  1. Ensure your practice is setup to take payments through multiple payment channels. This includes cash, checks, credit cards, and electronic payments through payment services such as Zelle, Venmo, and PayPal. The broader the range of payment methods, the easier it will be to accommodate patient payment preferences.

 

  1. Train your front-office staff on a consistent step by step workflow to inform patients of their financial obligations and to collect deductibles, copays, and co-insurance amounts upfront at every applicable visit. Include a system to monitor this at the end of each day. Also collect amounts for services not covered by insurance. Provide Advance Beneficiary Notice (ABN) when required.

In conclusion, collecting patient balances at the time of service is a crucial aspect of healthcare billing and critical for practice financial health. By doing so, medical practices can improve their cash flow, increase the likelihood of ever collecting on patient balances, reduce administrative costs, provide a better patient experience, and increase patient trust. This is a win-win for both medical practices and patients.

Rev UP Revenue By Outsourcing Your Medical Billing

Outsourcing medical billing to a professional medical billing company can bring a host of benefits to your medical practice. With the increasing complexity of insurance reimbursement and government regulations, it’s becoming more and more difficult for practices to keep up with the demands of medical billing. By outsourcing your billing, you can free up time and resources to focus on what you do best – providing quality care to your patients.

One of the biggest benefits of outsourcing medical billing is increased revenue. Medical billing companies have the expertise and technology to ensure that your practice is billing correctly for all services provided and following up on outstanding claims. This can result in a significant increase in your practice’s revenue. Many practices seen an increase in revenue by outsourcing their billing to a medical billing company.

Another benefit of outsourcing is the ability to stay current on insurance policies and government regulations. Medical billing companies employ experts who stay up to date on these changes and can ensure that your practice is billing correctly. A medical billing company can help practices stay compliant with the new regulations.

Outsourcing medical billing also frees up time and resources for your practice. Doing medical billing in-house can be time-consuming and requires dedicated staff. By outsourcing your billing, you can free up your staff to focus on other tasks and reduce the administrative burden on your practice. This freed up time allows your staff to focus on what your practice does best – excellence in patient care and patient experience.

Finally, outsourcing medical billing also provides a level of privacy regarding your revenue. Medical billing companies have the necessary measures in place to protect information related to your practice revenue, which can be a concern when doing billing in-house. Practices can keepfinancial information secure by outsourcing their billing to a medical billing company.

In conclusion, outsourcing medical billing can bring a host of benefits to your medical practice, including increased revenue, staying current on insurance policies and government regulations, freeing up time and resources, and providing a level of privacy for financial information. If you’re looking to outsource your medical billing, we invite you to take advantage of our free consultation to see how we can help your practice thrive.