Medical Billing Forum

Starting a Medical Billing Business => Starting Your Own Medical Billing Business => Topic started by: taxlady28781 on February 10, 2011, 03:59:18 PM

Title: Collection Agencies
Post by: taxlady28781 on February 10, 2011, 03:59:18 PM
How do you all handle past due collections that are ready to be sent to collection agency?  Do you send it back to the provider for them to contact a collection agency or do you send it on to a collection agency on their behalf?  Any other information/advice you can give on this subject is greatly appreciated.
Title: Re: Collection Agencies
Post by: PMRNC on February 10, 2011, 07:59:36 PM
My clients get a patient aging report at which time the accounts I flag for further instructions are sent to them and they can send it back to me with what they want done. I flag accounts I think should be sent to collections, payment plan suggestions and accounts I feel are not worthy of any further action (write-off).
Title: Re: Collection Agencies
Post by: dekenn on February 11, 2011, 08:19:05 AM
At what point do you determine what to write-off?  After how many bills, and what is your cut-off dollar amount?  I know that for a $5.00 missed copay, it's ridiculous to continuously bill and then file small claims, but just curious as to what other people cut it off at???  :-\
Title: Re: Collection Agencies
Post by: PMRNC on February 11, 2011, 08:46:22 AM
I can't say what "I" would consider to be write-off per Se'  I always have a copy of each client's office policy along with their financial policy, so I am following their policies, which is how it's supposed to be to keep things fair and reasonable.

If I have helped my client with their office / financial policies generally speaking the time frame for write-off's would be 4 billing cycles and one soft collection letter. Consumer laws prohibit providers/debtors from Threatening collections w/out follow-through so I usually have it in writing from the provider that that is what they wish to do for each individual account referred/recommended for collections. I also always use the Mini Miranda on all statements and correspondence.  As for the amount, that will depend on again different situations/amounts by client and taking into account their policy and patient's circumstances.  For example, one of my clients does not seek collection on a patient who has been billed for 4 billing cycles on missed appointments beyond 2. Another client has a $50 threshold to which he will not send to collections and either write it off and/or continue to bill and formerly dismiss the patient.

It really is a good idea to always have every client's office/financial policy in your possession to refer to. Keeps them in compliance and covers your butt as well!
Title: Re: Collection Agencies
Post by: Michele on February 11, 2011, 09:01:32 AM
If you work with a specific collections agency, they may have a limit on how small they will take.  We had one that wouldn't attempt collections on less than $25.  Not sure if that's common, and we don't work with them, I just thought it might be worth mentioning.

Michele
Title: Re: Collection Agencies
Post by: PMRNC on February 11, 2011, 09:19:07 AM
Quote
If you work with a specific collections agency, they may have a limit on how small they will take.  We had one that wouldn't attempt collections on less than $25.  Not sure if that's common, and we don't work with them, I just thought it might be worth mentioning.

I work with a few and that is true, there is one that I really like, they don't limit PER account but they do have $100 total minimum.
Title: Re: Collection Agencies
Post by: dekenn on February 11, 2011, 09:52:59 AM
I do the billing for my husband, so I'm really the one who sets the policy... just curious where other people/providers cut it off.  I send 3 bills, then decide whether to send to small claims court (usually over $150), or write off, but keep the bill in the patient's chart in case they come back in.  Sometimes, though, when the amount is like $8.00, it seems a waste of time, money and effort to bill three times when the patient hasn't even been back in.... they just ignore it.  Even when we take them to small claims court, they don't usually pay.  I have judgements against several patients....
Title: Re: Collection Agencies
Post by: PMRNC on February 11, 2011, 09:59:55 AM
I would go ahead and set one policy for yourself to take out the guesswork per account. Yes 8.00 is a waste of time. 3 Billing cycles is sufficient, I do 4 because I include a dunning message on the bottom with the mini Miranda that says "Your balance is now 120 days past due and your immediate attention to this matter is required or we may take further actions on this account".  This way we are not threatening specific tactic's and we have the wiggle room to write it off after that. If we are going to refer it to collections we send out a letter that states if the account is not paid within 15 days it will be sent to our collection agency for further collections.  All my offices have a ONE policy per office. The only exceptions would be the financial hardship cases, also which are clearly account documented.

Oh also of course, have every patient sign it and if changed have them sign the amended one as well. keep a copy in every patient file.
Title: Re: Collection Agencies
Post by: QueenAlicia on February 16, 2011, 01:10:28 PM
How do you all pick the collection agency?  Do you base it on their fees or do you give the provider the option of picking the collection agency themselves and dealing with it?
Title: Re: Collection Agencies
Post by: PMRNC on February 16, 2011, 02:40:41 PM
If they have one they have worked with, great. I however network with a few collection agencies. Some have become long term business associates and even friends. The one I use the most is actually a member of our Chamber of Commerce here.. another great networking tool.. I like networking with all types of businesses because you just never realize the links involved..accountants, collection agencies, etc.. I like my chamber better than any medical billing network really for that purpose (networking)

If you don't have any you know, it would NOT hurt anyone to get a hold of a few, meet and offer to exchange biz cards and just network :)
Title: Re: Collection Agencies
Post by: QueenAlicia on February 16, 2011, 02:44:53 PM
Thanks for clearing that up, I was a bit confused as to how that works.  I will research them to see how the charge.  I am working on my contract and want to make sure my fees cover the fee for collection agencies.
Title: Re: Collection Agencies
Post by: Michele on February 16, 2011, 05:36:54 PM
We do about the same as Linda.  We have more than one that we stay connected to, one is in the chamber.  We let the provider chose but we 'advise' them. 
Title: Re: Collection Agencies
Post by: PMRNC on February 16, 2011, 07:05:10 PM
I've never met another business to whom I could network with ever tell me to "buzz off" LOL  I even keep in touch with Pharmaceutical reps as that's how I get most of my consulting work!
Title: Re: Collection Agencies
Post by: aksharhealth on April 13, 2011, 10:13:21 AM
Who pay charge to collection agency? Doctor or Billing Service?
Title: Re: Collection Agencies
Post by: Michele on April 13, 2011, 11:50:54 AM
It should be spelled out in your contract but personally we defer collection costs to our providers.
Title: Re: Collection Agencies
Post by: aksharhealth on April 13, 2011, 01:33:00 PM
Thanks Michelle. Then will doctor pay commision to BS on the payment that he collect from patient? In this case he will also have to pay commision to collection agency.
Title: Re: Collection Agencies
Post by: Michele on April 14, 2011, 07:01:07 AM
I'm assuming you are charging % based on the question so that would have to be determined again in the contract.  Personally, when we charged % if we referred provider to a collection agency we were done at that point.  The provider paid the collection agency fees and we were out of the picture.  We did have a few providers that we actually dealt with the collection agency for them.  On those we still tracked the balances and payments after it went to collections so we did still collect. 

However, this is all good reason to support billing flat fee.  With flat fee all your work is covered, even if it goes to collections.
Title: Re: Collection Agencies
Post by: aksharhealth on April 14, 2011, 09:34:06 AM
I agree 100% to you. But here in Maryland every one is charging % so it is hard to change doc's Mentality. When we say flat fee they compare the figure to inhouse employee. This is my starting point, but once I sign 2 more clients then I will offer flat fee and see how it works.

Thanks.
Title: Re: Collection Agencies
Post by: Michele on April 14, 2011, 02:19:46 PM
I do understand.  Almost all providers I speak with expect a % when they ask "what's your fee?"  I'm preaching to the choir as well!  Anyway, in that case I would say that if you are still tracking the payments and balances after it is sent to collections then I would still include it in with your %.
Title: Re: Collection Agencies
Post by: rdmoore2003 on April 14, 2011, 04:41:01 PM
Last year I hired a collections company that is located down the road from us, but they do collections all over the U.S.   This is how we do it:
1st , when pts come in for first time, in the paperwork they must sign, it states that if account is sent for special handling, the pt/responsible party will be charged "A 35% service charge will apply to your account and any additional expenses or associated fees that are incurred in pursuit of this debt."
2nd, once all invoices are sent, a final "special handling" letter with same information on it is sent along with another itemized bill with the 35% fee added.
3rd, 15 days later it is sent to the collections company.  when pt pays the agency, the % is already in the balance owed.   So, we the provider gets our account paid in full along with the agency gets their money in full.   ITS WONDERFUL 
Once it goes to the agency, all we do is wait every month to get a check from the agency and that is all I have to do.
Title: Re: Collection Agencies
Post by: Michele on April 15, 2011, 06:41:23 AM
What is there % of collections?  They sound wonderful from your description.
Title: Re: Collection Agencies
Post by: aksharhealth on April 15, 2011, 08:54:44 AM
Last year I hired a collections company that is located down the road from us, but they do collections all over the U.S.   This is how we do it:
1st , when pts come in for first time, in the paperwork they must sign, it states that if account is sent for special handling, the pt/responsible party will be charged "A 35% service charge will apply to your account and any additional expenses or associated fees that are incurred in pursuit of this debt."
2nd, once all invoices are sent, a final "special handling" letter with same information on it is sent along with another itemized bill with the 35% fee added.
3rd, 15 days later it is sent to the collections company.  when pt pays the agency, the % is already in the balance owed.   So, we the provider gets our account paid in full along with the agency gets their money in full.   ITS WONDERFUL 
Once it goes to the agency, all we do is wait every month to get a check from the agency and that is all I have to do.
I really liked the system. It is great. If you don't mind, What is the name & phn# of the collection agency?
Title: Re: Collection Agencies
Post by: rdmoore2003 on April 15, 2011, 11:09:15 AM
Action Revenue Recovery  their website is www.actionrevenue.com  they are absolutely wonderful.
Title: Re: Collection Agencies
Post by: aksharhealth on April 15, 2011, 02:28:10 PM
rdmoore2003,

Thankyou very much.
Title: Re: Collection Agencies
Post by: rdmoore2003 on April 20, 2011, 08:20:32 AM
you are welcome.   They are GREAT!   Even the employees are very friendly and professional.  We absolutely love them.
Title: Re: Collection Agencies
Post by: rdmoore2003 on May 18, 2011, 04:52:07 PM
akshar,
did you contact the collections agency, if so, what did you think?