October 27, 2011
I read your article a few weeks ago about maximizing reimbursement and saw you mentioned collections by your law firm. What is the process?
Well, different firms/companies have different processes, so I can only speak for our firm. I recommend that any balance owed by a patient in excess of $900 be referred for collection if your in-house or external billing company are unsuccessful at obtaining payment. We see that as a regular practice patients try to keep checks from their insurance companies that are supposed to be turned over to the practitioner. Bottom line - this sort of action constitutes breach of contract, insurance fraud, and, of course, stealing. Failing to go after these monies is a big reason why many practices are losing the back-end of their billing. By back-end, I am referring to the last 40% of AR collection that is typically much harder to see. That 40% of the pot amounts to monies not paid by insurers and also amounts not turned over by patients. Our process is upon receipt of a 1-pager detailing the patient's information, amount owed a few more details, we either: (1) send a legal letter charging you $30 for the letter and direct the patient to pay the practice directly; or (2) send a legal demand letter and start a lawsuit. If step 1 were elected and prove unsuccessful, we would then, at the client's direction, move on to step 2. Our fee for step 2 is 1/3 of any recovery. We also require filing fees be paid up front, which is why I recommend that any amount under $900 potentially not be worth sending to collections. However, if you are sending enough cases to be started or on principle you wish to proceed on a lesser amount, we would discuss the merits. The benefits of working with a law firm instead of a collection agency is you have a lawyer overseeing and making any/all court appearances. Our firm starts over 1,000 lawsuits per month, and has an established, defined process for such actions. If you have any additional questions on collections, please do not hesitate to contact me.
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