Take Control of Your Dental A/R in 2014: 3 Tips for Collection Success!
It can be a common misconception in the dental industry that unpaid patient debt should just be looked at as the “cost of doing business,” and that the risk of jeopardizing an ongoing patient relationship is greater than the reward of recovering a past due account. In fact, in a recent TeleVox survey, 22% of the dental practices polled regularly chose not to contact patients with past due accounts because of the negative nature of the communication and in fear of losing the patient’s ongoing business.
But the truth is, dental practices in today’s economy simply cannot afford to let their accounts receivable get out of control. In the same TeleVox survey, 44% of dental practices polled also stated that past due accounts were considered a “problem” for their business.
So to help address your ongoing accounts receivable and collections challenges, here are three tips for higher recovery rates, happier patients, and reduced dental bad debt:
Tip #1: Develop and Follow Through On Your Collection Policies.
Do you have a strict procedure in place for every time a patient receives treatment? Do they receive a billing statement on the day of service? How long do slow-payers have before their account is sent out to collections? 60 days? 90 days? Is there a penalty for late payment? If so, how much? It is important to answer questions like these and then follow a consistent procedure for handling all patient accounts. When you start making exceptions for certain patients, not only do you send the wrong message about your billing policies, but you end up costing your practice the hard-earned revenue you deserve.
Tip #2: Offer Discounts for Payment Upfront.
One of the best ways to reduce collection costs is to avoid the entire process in the first place. Many dental practices today offer their patients a discount off their bill (typically in the 3-5% range) for paying for their services before receiving treatment. By doing so, not only do you allow patients to focus on their treatment as opposed to the bill pay process, but you can also guarantee payment in full without needing to worry about chasing down slow-paying patients.
Tip #3: Designate a Specific Person and Time for Patient Collections.
Making collection calls and recovering past due dental accounts is not a task for everyone. Choose a member of your staff who is not only personable, but is also willing to handle these oftentimes uncomfortable conversations unapologetically and assertively. More helpful tips on making successful dental collection calls can be found in our previous post: 10 Tips for Getting Paid While Maintaining Positive Dental Patient Relationships!
Another excuse many dentists and dental office managers make for not pursuing unpaid patient debt is that they simply don’t have the time. According to the TeleVox survey, approximately one in five dental practices (of those polled) said they fail to contact delinquent patients because their staff is too busy handling other responsibilities. For this reason, it is important to designate a specific time and day of the week specifically for patient collections. You owe it to yourself to recover the money you are owed, just don’t forget to find time to do so!
So make it a priority to take control of your increasing accounts receivable in 2014. Use the tips listed above and develop your own well-defined system for patient collections. Even a small reduction in the percentage of accounts that go uncollected can make a huge difference in your dental practice’s bottom line!
YOUR TURN: Have you been guilty of letting patients “off the hook” in fear of damaging the patient relationship? What other strategies have worked for your practice when collecting from slow-paying patients? We’d love to hear about your collections experience!