Accounts receivable and collection percentages are a subject that we hear about frequently. Every doctor has a different idea about what a good collection percentage is as well as how to collect money for services rendered.
For example, I have talked to many doctors who feel obligated to let patients/clients go without paying. They feel guilty about trying to collect from someone if they feel that the person is in a financial hardship.
While this is quite altruistic, it is very short-term thinking. These doctors must also understand that they can’t continue to provide help to their patients/clients if they can’t afford to keep the doors of their practice open. Another fact that is not commonly known is that failing to pursue a bill and persevere in asking for payment can actually have a negative effect on the patient/client’s self-respect. People expect to be billed, even when they complain. While it can be uncomfortable to deal with objections, realize you are making it possible to help many more patients over the years – and that is worth mentioning to them, as well.
Failing to insist on payment for services rendered can also lower your own esteem, making it harder to collect the next time. If you provide a service, you should be compensated for it. Period. Unless you go into a situation knowing in advance that it is going to be a charity case – and there is certainly room for that in any practice as long as it is planned for – you should always insist on being paid for rendering that service.
Of course, this is great in theory, but being able to actually collect all monies owed is another story and requires good group coordination and effort. If you and your staff are trained on how to do this from initial contact through patient discharge, including having the proper policies in place with your staff and patients/clients, your chances of collecting at the time of treatment go up exponentially. We believe that you should be collecting 98% or better of what you are producing, minus insurance adjustments. If you are collecting less than 98%, you are losing net income out of your own pocket.
Here are a few other tips that may help you when dealing with the uncomfortable situation of a patient/client who is saying they cannot make payment:
- Believe it or not, smiling is one of the strongest tools you have to deal with uncomfortable topics. Frowning or looking worried can have a subtle but negative effect on the conversation. Smiling naturally in a friendly manner when it is appropriate to do so is the best method.
- Speak confidently, concisely, and firmly. Never apologize for your prices.
- Listen carefully, but also use silence to control the conversation. One of the most powerful things you can do in a conversation is state your piece…and then shut it. The silence will become uncomfortable for the person, and they will often try to fill it by giving you reasons why they cannot pay. Acknowledge those, and continue to gently insist that a solution is found to make payment.
- Stay calm, even if the patient/client gets upset. Your emotions should not give the person any excuse to take offense or try to wiggle around the main topic of the conversation.
- Focus on one thing only – the patient/client – when making the calls to collect. Do not multi-task, but instead, concentrate on the person in front of you. This makes them feel important to your practice (which they are), and shows a level of care that can make paying easier to face.
By using these tips, you can gain better control of your collections percentages and thereby the level of care you can provide to future patients/clients. Any staff who deal with collections in your practice should be drilled on a regular basis in how to handle objections, present payment requests, and demonstrate a genuine, caring attitude. Whether you are asking in person before the person leaves, or trying to collect over phone, text or email, these same points apply.
Staff normally dislike roleplaying, and it is too easy to avoid in the busy week. But the reason for the distaste is often only a few simple (and very easy to correct) mistakes on the past of the executive doing the drilling:
- Only correct one thing at a time. Letting people have wins is one of the most overlooked, and therefore most important parts of drilling. When your staff first start out practicing objections-handling, they may make many errors all at once. THAT’S OKAY. It’s a drill, not a test. Simply pause the drill, correct just one thing, and have them continue drilling until that one thing is handled. Then take up the next error.
Failing to balance criticism with praise. When staff do something right during a drill, pause and let them know. This reinforces what you want, and in fact can often be more powerful than any negative criticism you might offer. In other words, push the hardest on the thing you want more of.
If you are a practice owner and would like free help regarding collections or any other management topic, we will help you if you help us by doing a 15 minute anonymous interview regarding practice management. Fill out the form to your right, and we will be more than happy to assist you. (highly recommended)
If you are a practice owner and would like free help regarding collections or any other management topic, we will help you if you help us by doing a 15 minute anonymous interview regarding practice management. Fill out form below, and we will be more than happy to assist you. (highly recommended)