“I understand that payment of my account, in full, is my responsibility and that my health fund / insurer might not cover the total amount invoiced. I am responsible for any further costs that might be incurred resulting from my not paying my account, in full, by the due date.”
Patient Signature: ____________________________________ Date: ___/_____/________
If raising accounts and allowing patient to pay after the Service is provided, you should have on Invoices reference to what they have already signed on the Patient Detail form.
You can assist your Patients with paying your account by providing them with a number of Payment Options and detailing these options on a Remittance Advice on your Invoice. This Remittance Advice details your Bank Details if you accept Direct Deposits, Credit Card details and Postal details if you accept Cheques or other Payment Options.
With the majority of Patients having a Debit or Credit Card, bad debts are not as common as they once were. If you do not have an EFTPOS Terminal, you should consider installing one. There are Merchant Fees involved, but ensure your billing fees cover any of these costs. The benefit is immediate payment resulting in good cash flow.
On processing the EFTPOS payment your staff must be trained to take note of the printout ensuring that the payment has been approved and not declined. Circle the word Approved. Check the amount processed is correct, circle it too, and write the patient’s name on the slip if not already printed (some EFTPOS terminals do not print the patients name).
Cash payments are good as long as you get the money into the bank and do not allow staff to use it for other expenses. It is bad practice to take Cash received for business expenses or loans. Best to have a Petty Cash System setup for these cash expenses.
Not too many businesses accept cheques today. If you do, record all of the Cheque Details (BSB, Account Number, Name on Cheque). Also insist on recording the Patient’s residential address. You will need this information, if the cheque is dishonoured. Your Practice Policy will include reference to the fact that any dishonour fee you are charged will be on billed to the patient.
With many patients having internet banking, paying by Direct Deposit is also popular but can be frustrating and time consuming if they are not educated to include their Name and Invoice Number on the Deposit details.
You may have set up a BPay facility. If not, talk to your bank directly about setting this up. You will be allocated a Biller Code and then it is just a matter of ensuring your Invoices print the correct detail for Patients to reference.
Paying via the Net
Patients can be directed to your Web Page where you may have setup secure payment facilities.
What if they do not pay?
Your terms of payment should be within xx days of Invoice Date. If the patient has not paid within this time here are suggested Steps to follow. Some Practices do not worry about Step One. They move straight on to Step Two.
Step One: Send the Patient a Statement reminding them that this account is overdue and please pay by dd/mm/yyyy.
Step Two: Should the date on the Statement pass, you can then send out a copy of the invoice along with a Letter. This letter may read as per Figure 2:
Step Three: If the date on Letter One passes, you can then send out another copy of the invoice along with Letter Two.
Step Four: Hand it over to your Debt Collector and move on.
You can avoid bad debt by having in place proper Invoicing Procedures.
Invoicing procedures for patients will depend on several factors:
• your Discipline
• the age of your business (as in just starting out or well established)
• your Patient demographics, and
• your expertise.
You have a number of invoicing choices:
Set your fees as you see best. This can be based on an existing fee schedule (AMA, Medicare, AHSA, etc) or a percentage of or you can simply decide on what you are going to bill per Item Code. It is your choice to offer discounts as an incentive for quick payment or not.
It has been accepted practice that if billing for Medico-Legal services (MBS non rebateable and GST Inclusive), you raise the invoice and receive payment before you carry out the service.
With ‘In-Room’ Services, Medicare Australia is encouraging Doctors to use electronic Medicare claiming.
This is not Bulk Billing. You can charge your full Private In-Room fee and you can lodge claims electronically by using Medicare Easyclaim that uses the EFTPOS terminal or via your Practice Management Software Programme if it integrates with Patient Claiming. Either way the patient is invoiced for your full fee. If they pay in full, the claim is submitted to Medicare Australia in real time, processed and the rebate is paid into the Patient’s bank account within seconds.
If you choose to accept the Gap (difference between your fee and the Rebate being the Out-Of-Pocket), Medicare raises a cheque made out to you but posted to the Patient relying on the Patient sending this Cheque to you. Medicare has now extended the Pay Doctor Via Claimant (PDVC) 90 day rule for Specialists. This facility has only been available to General Practitioners until recently. What this means is that if the Patient does not send in the cheque to you, after 90 days, Medicare will stop payment on the cheque and direct deposit the monies to your bank account.
For In Hospital procedures, for some Specialists, it is also accepted practice to have the patient ‘pre-pay’ for the entire procedure. The problem here is what do you do if the procedure changes? You either wear the difference, or raise another invoice for the difference or give a refund.
You have the choice of Direct Billing to Medicare for Bulk Billing and DVA. This means that you accept what Medicare Pay and you do not charge the Patient any fee over and above this. These claims can be sent in manually, but many Practice Management Software Programmes facilitate electronic batching and processing.
For In-Hospital (Inpatient) procedures for Privately Insured Patients, you can Direct Bill to Health Funds. If you accept the Fund rulings, their schedule fee is usually higher than the Medicare Benefits Schedule. Some Funds allow you to also charge the Patient a GAP (Out-of-Pocket or Known Gap) and some do not (No Gap). If you charge the patient more than the Known Gap allowed, then the rebate will only be 100% of the Medicare Benefit Schedule resulting in the Patient being very much Out-Of-Pocket.
To Direct Bill Health Funds, Doctors have to register with each Fund. To do Business Online with Medicare, you must also be registered … www.medicareaustralia.gov.au
Invoices can be lodged for services provided up to two years in the past. If Services were before that time, an Application for Late Lodgement form must accompany the invoice.
This article was written by Dr Robyn Peters, Managing Director of Connect Direct, developers of Direct Control, a business management software solution for the health sector.