Patient Cost-Shares: The Pitfalls of Pre-Collecting Payments

In the complex landscape of healthcare billing, determining patient-cost-shares has become a crucial aspect of medical practice management. I’ve received inquiries about pre-collecting payments from patients and exploring the feasibility of taking deposits or upfront payments for services. While the idea might seem appealing, I must emphasize the need for extreme caution when adopting this practice.

The logic behind pre-collecting payments is clear – with the rise of high deductibles and the importance of patients settling their bills promptly, healthcare providers seek financial security. Unless a pre-appointment evaluation of a patient’s benefits status is done, the risks of pre-collecting payments can outweigh the benefits.

Navigating the Complexity of Insurance Plans

One significant challenge arises from the variability in patients’ insurance plans. Service tiers and diagnosis codes can impact how cost shares are applied, varying between specialist and primary care services. Carve-outs and exceptions further complicate matters, as certain services may not be subject to patient cost shares, leading to potential miscalculations if not carefully examined.

Moreover, the timing of claims processing adds another layer of uncertainty. Towards the end of the year, when funds may be dwindling, insurance companies tend to slow down, causing delays in claims adjudication. This can create a misconception for providers regarding a patient’s deductible status, as pending claims may impact the overall calculation.

Despite the temptation to collect payments upfront, it’s essential to acknowledge potential downsides. Refunding patients, as necessary, can be a logistical nightmare, especially when dealing with significant sums of money. Legal considerations, such as state-specific laws on keeping balances or credits, further complicate matters and may require consultation with a healthcare attorney to ensure compliance with payer contracts.

The Misconception of Charged Amounts

A common misconception is collecting the charged amount on a CPT code, overlooking the contractual adjustments that will inevitably reduce the final payment. Providers must know their allowable amounts and charge patients less than the expected cost share to avoid potential refunds.

A robust collections system and efficient billing processes can be more effective than relying on pre-collection. Regularly sending statements, promptly notifying patients of their responsibilities, and providing multiple payment options contribute to a streamlined and effective revenue cycle.

Balancing Proactivity with Prudence

While pre-collecting payments are understandable, the potential pitfalls and complexities warrant careful consideration, given healthcare providers’ financial pressures. Influential collections and a deep understanding of insurance processes are vital for maintaining the financial health of medical practices.