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Orthopaedic Surgery Practice Takes on the Challenge of Point of Service Collections

Thursday, December 8, 2016   (0 Comments)
Posted by: Kevin Joyce, Orlando Orthopaedic Center
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Increases in patient deductibles and out of pocket expenses forces a new approach to patient collections.


There is no question that it has become increasingly more challenging to chase down patient balances and collect deductibles as more employers and carriers are offering higher deductible and out of pocket maximums on employee coverage.  According to a recent report from the Kaiser Family Foundation, average payments by enrollees towards deductibles has risen 256% from $99 to $353 over the period 2004-2014.  At the same time average payments for co-pays has fallen 26% from $206 -$152 according to the same report.  

Practices have traditionally had high success collecting patient co-pays at the time of service. Without a process to combine charges, contracted fees, and real time eligibility/benefit data on deductibles and co-insurance amounts, it is extremely difficult to collect a patient balance at the time of service and have any accuracy or confidence on the amount actually owed by your patient.  As a result, most practices simply wait until the claim is fully adjudicated by the insurance carrier to bill the patient for the actual amount they will owe.

Some practices have evolved their front-end collection process to offer a flat estimate of charges and fees for the service and will collect this estimate at the time of service.  However, this approach often leads to additional collection efforts for smaller balances or a refund to the patient if the practice over-collects, which results in additional work and cost to receive full payment. 

Many physician offices have implemented “credit card on file” technology to allow the practice to store the patient’s credit card info to charge when the insurance carrier has processed the claim and the final balance is determined.  This strategy is gaining more popularity as patients become more comfortable with leaving a credit card on file with their physician’s office; however, this approach has its limitations mainly with the patient being comfortable leaving this information without any knowledge of the amount that will ultimately be charged to their card in the future. 

As an orthopaedic practice, we have been collecting estimated fees for high-end services like surgery, MRI & pain management procedures for years. Although the staff responsible for this function had the time and the information available to them to provide an accurate estimate of out of pocket costs for the patient, this pre-collect process did not work for time of service fees in the office.

Over a year ago our practice analyzed our accounts receivable (A/R) balances and using aging reports noticed that patient balances for office based services continued to increase and become a larger component of our 120 day and greater A/R, and that we were spending significant time, money and resources chasing down these patient balances for many months.  We started exploring different strategies to address this problem and shift the focus of collecting a large portion of this balance on the day of service.  What we found was that in order to provide an accurate estimate of the charges for any given encounter there needed to be several elements combined together simultaneously in order for this process to work.   Our exploration efforts eventually paid off by finding a technology vendor who was capable of pulling all of these billing/benefit elements together real-time, allowing our practice two options to offer our patients to settle their balance for that day’s encounter before ever leaving the office.  Orlando Orthopaedic Center partnered with a third  party technology vendor, who has helped our practice turn the corner on office based service collections at the time of service in a timely and cost efficient manner, insuring accuracy and security while maintaining efficient patient flow. 


Before we could actually go live with the technology solution, our practice had to address several unique items that presented some serious challenges:

  1. We have seven satellite offices with various patient flows, no centralized check out, and varying staffing levels to support this new function.
  2. Technology/IT Vendor limitations.
  3. Limited space to engage patient in private/sensitive payment communications.
  4. Need to combine several data elements and real-time patient benefit information into a single claim adjudication.


Once we addressed these initial challenges we were ready to launch this new program. Here is what we did to ensure we were successful:

  • Train staff on the new program and technology.  This involved script development, role play with staff, and live patient experiences.
  • Determine the amount of staff we needed to perform this function at each office based on patient volume and payer mix of patients.
  • Determine specific technology needs for Patient Financial Counselors. Used tablets with a credit card wedge reader running the technology vendor program.
  • Determine which patients we target and which ones we don’t based on specific criteria we developed.
  • Validate and compare our results from the estimator tool to the actual claim processed by the insurance carrier. 


Key Takeaways From Implementing a Point of Service Collection Program:

  • Patients appreciate the information and transparency of receiving an estimation of fees from their provider. It helps build further trust and loyalty to the practice.
  • Less time/expense of follow up efforts and questions about statements from patients.
  • Must involve the entire clinical team (provider, medical assistant) in this process.  Charges need to be entered timely and accurately, and the provider needs to allow time necessary for the collection staff to perform their duties.
  • Must track the following results and statistics to continue to adapt and improve the program as necessary:

o   # of Patients who were targeted

o   % of Patients who paid the estimated amount

o   % of Patients who left a credit card on file

o   # of Patients who were missed or refused to pay

o   % of amount owed collected by practice at POS.


Summary:  Collection of fees at the time of service is no easy task.  Having the technology and processes in place to identify and efficiently engage patients at the time of service requires a number of key elements and data to merge in order for this to work.  Initial concerns about delays in clinic, push back from patients, and inaccurate estimates did not materialize.  Patients have commented how pleased they are to receive the information about their out of pocket cost for services and that they have several ways to settle the amount owed at the time of service.  Much effort was spent analyzing the results of the first phase of this program where some processes were modified and streamlined.  Staffing levels were adjusted.  Patient targets for collection was further refined, and training for staff and specific scripting has been modified for optimal communication with the patient.

After the first 6 months of implementing this POS collection effort at our practice we have experienced the following results, which highlight some of our key achievements.  Orlando Orthopaedic Center has had mostly success with this project, and we have changed the way we collect patient balances without the amount of time and expense it used to take:  (see statistics below)

  • 90% of targeted patients paid their estimate or left a Credit Card on file at the time of service.
  • No additional staff were needed or hired to accomplish this effort.  Use of existing patient financial counselors were sufficient to handle individual clinic POS collections.
  • Higher return on expense from POS collections.
  • Reduction in number of days on average to collect a patient balance.


About the Author 

Kevin Joyce is the Executive Director of Orlando Orthopaedic Center. Mr. Joyce joined Orlando Orthopaedic Center as Executive Director in 2006. Accomplished in orthopaedic practice management, Mr. Joyce’s experience includes serving as the Executive Director of Orthopaedic Associates of St. Augustine and Administrative Director of the University of Florida Department of Orthopaedics at Shands Jacksonville.

Kevin has extensive experience with the implementation of electronic health record systems and Digital X-ray. He has also directed the construction and development of orthopaedic ambulatory surgery centers and pain management programs. He has also helped develop many successful and profitable ancillary services within the orthopaedic practice including in-house brace dispensing, medication dispensing, interventional pain management services, MRI and Physical Therapy.

Prior to orthopaedic practice administration, Mr. Joyce implemented the start-up of a new healthcare Preferred Provider Network (PPO) and served as Director of Provider Networks Premera Health Plans and KPS Health Plans in Washington State.


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