How have you decided to begin 2024?
Same ole, same ole? Doing the same things over and over, just as you have always done it, and ignoring those processes that are not working, just because you have always done it that way?
The new year is a time to make changes to obtain a more successful outcome.
I just completed a Financial Practice Analysis who wants to make changes for the upcoming year. He wants to know where the weak financial areas of his practice are and how to implement the profitable changes.
One of the weak areas was insurance – no, not the reduced payment schedules but the handling of the insurance processes. There is a reason that so many patients either have not paid their outstanding balance or why they were sent to collections. It was a very interesting financial deep dive.
It is the end of the year, the time to decide how you will do things differently this coming year. Let’s not call them New Year’s Resolutions. Let’s call them the …
2024 Intentional Decisions
Intentional because intentions are calculated, decided upon, designed with purpose and reason.
Decisions because it is an acknowledgement that things will be done differently this year, setting the expectations for the new year.
#1 – We will receive the maximum allowed insurance claim payments.
Are you receiving maximum insurance claim payments now? Why not?
This has been one of the most commonly broken parts of my clients’ Financial Practice Analysis, and within that, there were several aspects needing to be changed.
The first is making sure the insurance schedules are up to date. Now is the time of year to make sure you start the new year with the updated insurance schedules in your practice software. Insurance companies update their schedules periodically. Make sure all your major providers have been updated, every year.
It is much easier to collect the patient portion up front than to chase collections. It may be necessary to alter how this is done now compared to how it has always been done in the past. The economy is a little tight now, especially this time of year. Make sure that the schedules are up to date, so the correct patient portions are collected up front or at the time of service.
Call the insurance providers and request a fee schedule. The rates could have increased without notifying the practice, or they could have decreased without notifying the practice. Most just “assume” that the insurance company just paid less or more for that patient for some reason. Never assume.
Secondly, my colleague and friend, Dana Moss of PPO Dental Consulting and I were talking about insurance negotiations and she said they have been having wild success with negotiating higher rates now. Maybe it is because it is the end of the year? Maybe it is because more dentists are dropping insurances for low payments? But, how long has it been since you have had your insurance fee schedules reviewed? Unfortunately, I am not talking about Delta Dental, United Concordia or MetLife. These big three are in a non-negotiable mood. But, what about everyone else? Want to see if you could be paid more? Reach out to Dana if this is something you would like to check into.
#2 – We provide excellent dental services to all our patients, therefore, we will never hesitate to ask the patient for their payment.
I have had practices in the past, where the team member checking out the patient said to “just wait until the insurance pays and let’s see what the balance is.”
No. That is not good business. Hard NO.
This may be when Snarky Susan prevails and says that the team members’ paycheck could be delayed because of lack of patient payments… The grocery store team members, working the registers, have no problem asking me for payment. It should be the same in any practice, without fail or hesitation. In fact, many practices opt for taking payment prior to being seen, which may prevent the “I forgot my wallet” scenario.
Because the insurance schedules will be up to date, there should be no problem collecting the appropriate patient payment.
Because my client’s practice also did ortho, someone chose to exclude the ortho patients from receiving statements. During one of the deep dives, I read a note that an ortho patient had been sent to collections, having no clue that there was a remaining balance. They had been paying monthly, and when I checked, that patient was on the do not send list statement list.
Remember, Dunning Statements are to compel a patient to pay. For ortho patients, still send a monthly statement with a different Dunning Statement. After an insurance payment has been entered into the practice software, if there is a remaining patient balance, send that statement immediately. If there is no payment or phone call within 10 days of sending the first statement, send another statement.
If you have ever opted for a 6 or 12 months interest free purchase, you know that you still receive a monthly statement, which provides information about the last payment and the current balance. By sending everyone a statement, that is what the practice is doing.
If you have not collected the balance within 30 days of the insurance claim payment, the likelihood of being paid drastically decreases. This area is of vital importance to the financial health of the practice.
I recently had eye correction surgery. Because of my years playing tennis, with no sunglasses, my eyes developed cataracts early. When I was booking the surgery dates, the financial coordinator did not hesitate to ask for payment. Payment is taken at the time of booking the surgery. She knew exactly what insurance would cover and what my portion would be. It was very smooth and she did not bat an eye in the asking.
Why do more practices not asking for payment at the time of scheduling treatment? It sets the expectation of payment very clearly. While speaking in Minnesota this year, one practice told me they take payment when confirming the appointment. A side result is much fewer cancellations because the appointment has already been paid. The negative side is a higher credit card interest rate because of manually keying in the number.
My client’s practice had a great number of patients sent to collections. When a patient is sent to collections, what is received back to the practice is not the full owed amount. Let’s look at an example:
Suzy had her scheduled bi-annual appointment. Of the $245.00 total, the insurance paid $90.00 and Suzy now owes $155.00. No efforts to get Suzy on any kind of a payment plan have been successful. Suzy is sent to XYZ Collections, for which, from that $155.00 balance, 20% will be received, if anything at all. Suzy receives the letter from collections which compels her to pay the $155.00 balance. XYZ Collections then sends the practice a payment, minus the 20%, of $124.00.
Never hesitate to ask for patient payments. It is not being greedy. It is being a good Team Member and an even better business owner.
#3 – All patient collections will be deposited into the bank. The deposits will all be made within the same month as collected, at the very least. If they are not taken the same day as collected, then they will be secured in a locked box that only the owner has access to.
Creating a daily deposit is excellent accountability within a practice. I have written and spoken about the virtues of the daily deposit the entire past 28 years. To not do so, opens a wide door to embezzlement. Don’t get me wrong, you could do a daily deposit and still be embezzled from, as in my $1.1m case. But, the lack of accountability in a practice regarding deposits can be catastrophic.
The deposits were not secured in the recent Financial Analysis. These can be easily done by something as simple as a locked mailbox. With the slot at the top, the deposit can be easily put in an envelope and then into the locked mailbox. I also suggest the one creating the deposit initial the envelope, which states it matches the daily report.
It is that time of year when some deposits do not make it to the bank. Though I have not heard it recently, sometimes a CPA suggests holding back deposits at the end of the year. Be aware that if it goes into the bank OR the practice software or both, the patient payments or insurance payments are considered revenue by the IRS. Having said that, make an effort that the insurance EFTs be entered into the practice software prior to the end of the year.
End of the month, and the end of the year, make sure all the patient and insurance collections entered into the practice software are in the bank, as well as all the patient and insurance collections that are in the bank, are in the practice software.
#4 – We will be accountable for being honest, leading with integrity and being kind at all times towards our patients and towards each other.
This was not an issue with the recent Financial Practice Analysis but has been an issue in many practices I have consulted this year.
This has been an interesting year of learning that businesses have learned to say whatever they need to make themselves look good in the outcome. Some consider it the Art of the Spin. I consider it dishonesty. My dad called it “talking out of both sides of your mouth.”
I had a potential client call this last week that had discovered embezzlement. When we talked about their insurance coverage of the theft, they learned it was only $10k coverage. This was their response: “Since I have not engaged you yet, could I increase my coverage first, then engage your services?”
To say I was stunned would be an understatement, but they will not be engaging my services. There was much more to it but, in the end, it is my call. They will not be my client.
I have released clients because they continued to commit insurance fraud. I have released clients because they continued to commit intentional tax fraud. And when I say continued, it was after long discussions of how unwise they were being, putting their practices in jeopardy, their livelihood at risk, and their very license in peril. Of all the years spent in school and the amount of debt from higher education, being unethical is not the means to gain ground.
I have had practices that were hostile work environments. The doctor owner was either passive to controlling employees (as well as the practice) or the doctor owner was a toxic controller. In that environment, the practice will not succeed. And the heartbreaking team members’ lives will suffer emotional and financial consequences for staying and trying to make it work.
CBS Journalist Steve Hartman has provided insight into kindness for a few years now. I love the Monday Morning segments with his kids. Last year, a CBS Special #KindnessGoesViral aired. These segments go beyond resonating with my heart. They resonate within the depths of my soul. If you are struggling, need a little encouragement, watch the Kindness 101 segments on YouTube. Then make sure you pay it forward with 1.1 acts of kindness.
Our society craves honesty, integrity and kindness. It cannot be bought or demanded but can be freely given. Our choice.
How have you decided to begin 2024?
What is on your list of 2024 Intentional Decisions? Think about it and write it down. Make the changes you need to make and, if I can help you, let’s schedule a time and talk about it.