Time to perfect non-aggressive collections methods


Over the last several months, the hospital industry has come under particularly intense pressure to cut down on bad-debt ratios. Not only are high bad-debt levels a major drain on performance, they're often seen as a sign (by, say, ratings agencies and Wall Street) that the hospital doesn't have its act together.

So how can financial leaders respond?  Well, lots of ways, of course, including:

*  Doing a better job of qualifying patients for state and federal programs that can cover a significant portion of their bills.

*  Making it easier for patients to pay their bills (as with Tenet's recent addition of an online bill payment option).

* Collecting more money up front before delivering non-emergency services.

* Instituting collections efforts, either en masse or by targeting patients most likely to pay.

As you'll probably agree, these methods range widely in aggressiveness, from helping the patient file paperwork to full-scale pursuit of their assets.

Now, any one of these tactics might cut down bad-debt ratios overall. And depending on how they're handled, they may or may not discourage the patient from choosing your facility again. The thing is, you've got a couple of powerful forces working against you that argue for perfecting more-gentle tactics. 

First, the U.S. economy remains wobbly at best, with jobs going away while gas and food prices are through the roof. Push a patient too hard over a healthcare bill and you'll probably get a bankruptcy notice, not a big recovery.

Meanwhile, with CDHPs still a presence out there, you're going to run into a lot of patients with very substantial co-pays to handle. If your organization doesn't develop the tact, creativity and--let's admit it--sales skills to make sure solvent families pay their bills, you're in trouble. After all, every time you have to fight for your money--in court or through an agency--it costs you.

It will be interesting to see, in the next six to twelve months, whether aggressive strategies or the kinder, gentler machine-gun hand works. I'm arguing that for the time being, being Mr. Nice Guy will work better. 

But readers, what do you think?  Let me know what your experience has been--I'd love to hear from you. - Anne

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