Best Practices in Patient Billing and Collections: Effective Approaches and Tools for Patient Communications

Part 1 of a 4-part series designed to offer small practice providers tips on improving their administrative and clinical operations.

Consider how long it takes to pay your energy bills. Every month, the bill comes in. You are expecting it. You know your service will be cut off if you fail to send a check. So you promptly pay the bill. The time from service delivery to payment collection for utility companies is only a matter of weeks, even with customers who continue to pay through the mail. It’s hard to imagine anything longer than that.

In contrast, the time between a patient visit and full remittance is typically much longer—often dragging on for months.

This is a major pain point for most practices. When your providers don’t get paid in a timely manner, cash flow suffers for both you and your providers. Often, the longer it takes to receive patient remittance, the less likely providers will get paid in full. Discounts may be negotiated, for instance and providers may be forced to write off balances they have no hope of settling.

The bad news is that the problem is expected to get worse. Patient responsibility—out-of-pocket payments—rose nearly 50 percent between 2000 and 2010 to an all-time high of $299.7 billion.* This trend is likely to continue as payers look to relieve their own financial pressures, including increased competition and rising costs for medical care.

Physician practices can achieve a certain degree of control over the situation, however, by recognizing contributing factors, managing “patient-responsible” balances more proactively and communicating with patients more effectively. Here are some tips and tactics to keep in mind.

1. Educate your providers to ensure that the information they have about their patients is current and accurate. This information is provided by the patient through registration forms at the time of the visit or through online forms that the patient can submit prior to arriving at the doctor’s office. Whether your providers use your software or their own technology to capture patient registration, it is important to verify this information with their commercial and Medicare patients at least once a year to keep records up to date. Medicaid patients are the exception: because of the generally transient nature of this population, information should be checked at the beginning of each month.

2. Traditionally, physician practices have not asked and thus often choose not to, bill their patients at the end of the visit. They know insurance will pay some of the charges and prefer to wait until they receive insurance reimbursement to then calculate the patient’s portion. However, providers can close this gap by verifying benefits and eligibility before patients arrive at their office for the appointment. Emdeon is connected to the largest group of commercial and government payers in the industry through which accurate eligibility information can be verified in real-time or high-volume batches. And easy-to-read benefits statements enables providers to see an estimate of what their patients will owe at check-in. This allows providers to educate patients about what’s covered and what’s not and ultimately, what they owe and should pay at the time of service.

3. Use the phrase “final bill” liberally on patient statements. Patients pay more quickly when they understand their balance is really and truly due NOW. After providers have received insurance reimbursement, they should generate a final bill—even if it’s the first statement they have sent. This will alert patients that the amount presented is final and creates a sense of urgency to send payment. Patients may also be more inclined to pay in a timely manner if given a secure online payment option.

Because of the “caring” nature of medicine, some practices in the past have found it difficult to pursue payment from patients. But by utilizing the approaches outlined above, practices can be better equipped to adopt a process to discuss charges openly and encourage timely payment that will allow providers to stay competitive as the trend in patient payment responsibility continues to grow.

By using our innovative reporting, analytics and payment tools like Emdeon Vision for Claim Management, Emdeon Expressbill, and Emdeon Patient Pay Online your providers can see where their revenue is at all times. Our combined approach of strong communication and technology services will cut costs, and speed up the billing and payment cycle giving your providers more time to spend with their patients.

(Note: Stay tuned for an in-depth look at online strategies to enhance patient billing and collections in the next issue of this newsletter.)

If you would like to re-publish provider-focused version of this article or any other for your own newsletter, please email us at

* “Consumer Out-of-Pocket Payments for National Health Expenditures,” Centers for Medicare and Medicaid Services, Office of the Actuary, Jan. 2012.

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