As a third-party agency, how can you ensure your collection efforts are compatible with your healthcare client’s expectations? A good starting point is to understand the recommendations developed by the Medical Debt Collection Task Force, a group led by members of the ACA International (the Association of Credit and Collection Professionals), the HFMA (the Healthcare Financial Management Association). The diverse task force includes representatives from healthcare providers, consumer advocates, collections agencies and credit bureaus.
In January 2014, the group published a comprehensive report titled “Best Practices for Resolution of Medical Accounts.” This report documents post-service best practices for fairly resolving the patient portion of medical bills.
Here’s a summary of the report’s important recommendations:
- Patient-friendly billing and communication – All communication with a patient, either by the healthcare provider or its collection agency, should follow certain guidelines. Communication, including prior to patient discharge and after service delivery, must be easy to understand. Clear language should tell patients exactly what they need to do.
To accomplish this objective, you create a concise billing document by incorporating the appropriate amount of detail – not too much or too little information. And, be sure you review all documents for accuracy.
- Helpful patient education – Healthcare providers and their collection agencies must provide a clear understanding of what happens at every stage in the process. By explaining what is expected, patients become active participants in resolving their outstanding balances.
The earlier in the process you educate patients, the sooner you can expect account resolution. Be sure you design patient education with engagement in mind. Help patients understand their financial responsibility, including their current balance and resolution options. For example, you should try to qualify patients for coverage by third-party payers, as well as discuss financial assistance programs. These programs must be made available to patients throughout the resolution process.
In addition, healthcare providers and their agencies need to advise the patient of shared responsibilities. This step requires providers and agencies to develop a streamlined information gathering process while patients provide requested information in a timely manner.
- The process workflow – Providers and agencies need to adhere to an established framework for medical account resolution. Healthcare providers believe most patients want to resolve their accounts responsibly. However, the collection process often lacks consistency. Therefore, providers and agencies must standardize and simplify the account resolution process.
The industry best practices identified by the Medical Debt Collection Task Force help lead to improved collection processes, financial performance and patient experiences. The process includes two parts for post-service collection:
- Part 1 Post-Service Account Resolution involves a continuation of pre-service and service delivery activities. During this phase, providers screen the patient’s account for primary and secondary payers for billing, payments made and posted, service discounts for the uninsured, public program eligibility, bankruptcy proceedings and available financial assistance programs. If they are unable to clear the account using financial assistance, the account enters the collection phase.
- Part 2 Post-Service Account Resolution manages the resolution process for at-risk accounts. Unless cleared through a financial assistance program, the account goes to a collection agency. The collection agency’s efforts depend on the provider’s approved collection policies. The agency attempts to clear an unpaid account through a variety of efforts, including ongoing communication, credit bureau reporting and legal action.
The above discussion represents a high-level view of best practices for healthcare providers and their collection agencies. The process provides a standardized approach to resolving the patient portion of medical bills. It also incorporates a patient education component.
All collection activities should be balanced, fair and protect the best interests of the patient. By following the guidelines established by the Medical Debt Collection Task Force, collection agencies are well-positioned to meet the objectives of their healthcare clients.