The Real Cost to Collect After the Visit: It’s More than You Think
As patients’ financial responsibility for their care increases, collecting payments before the visit or at the time of service matters more than ever. But most providers still mail several statements to collect payments after the visit—and the longer a patient’s invoice goes unpaid, the greater the cost to collect.
In addition to impacting your bottom line, the non-monetary costs of waiting to bill and collect can hurt your organization’s efficiency, reputation and brand identity, as well as your relationship with patients.
Click the image to view the full-sized infographic
The Real Cost to Collect After the Visit: It’s More than You Think
Respectfully collecting from patients at the time of service helps your bottom line, but it also protects your organization from serious damage to its reputation, its brand and its relationships with patients. Here’s a snapshot of what can happen when you wait to bill and collect.
Monetary Costs
On average, providers mail more than three statements before a patient’s account is sent to collections.
- 1 in 3 patients whose balances exceed $200 do not pay them in full
- 6%: Percentage of outstanding balances collected when a patient’s debt is more than $200
Approximately 75% of physician practices wait more than 90 days to turn overdue bills over to a collections agency.
- Nearly 1 in 5 people living in the U.S. have medical debt in collections.
- The longer an invoice has gone unpaid, the greater the cost to collect.
- Once a patient’s balance gets sent to collections, there is only a 7.4% chance of full recovery
- $140 billion: Estimated total medical debt in the U.S.
More than the Money
TIME: Post-visit billing and collections processes are labor-intensive, taking up staff time that could be better spent on creating positive patient experiences.
PATIENT EXPERIENCE AND RETENTION: The billing process is often the final and most influential point of contact between patients and their provider. An aggressive collections experience leaves patients with a bad impression and can make them less likely to return for follow-up care.
COMPLIANCE WITH TREATMENT: Research shows there’s a direct correlation between patient-provider trust, cost pressures and medication adherence. Aggressive collections efforts can diminish that trust and damage the patient-provider connection, which may negatively affect patients’ health outcomes.
REPUTATION AND BRAND IDENTITY: A bad collections experience can lead to negative patient reviews and damage an organization’s hard-earned reputation.
“Aggressive collection efforts after the visit rarely work—the process is time-consuming, expensive, pushes patients away and can ruin your brand.”
–Elizabeth Woodcock,
Principal, Woodcock & Associates
Providing patients with flexible, time-of-service collection options like card on file, online payments and payment plans will help you avoid both the monetary and non-monetary costs to bill and collect after the visit.
Phreesia’s revenue cycle applications can help your organization reduce its cost to collect. Learn how
Sources:
1 Medical Group Management Association (MGMA)
2 Health Affairs
3 athenahealth
4 MGMA
5 JAMA Network
6 Consumer Financial Protection Bureau
7 HIT Consultant
8 Journal of General Internal Medicine
9 Journal of Health and Social Behavior
