DEALING WITH SELF-PAY PATIENTSA good way out of this
As the private healthcare sector continues to open up again to private patients, Simon Brignall discusses the importance of self-pay in ensuring your practice recovers
THE CORONAVIRUS has proved to be extremely challenging for consultants in private practice and has meant they have had to make a lot of difficult decisions over recent months.
At Medical Billing and Collection (MBC), we partner with over 1,300 consultants, groups, clinics and hospitals across all specialties. Our data indicates that the low point in activity was the first week of May and subsequently there has been a progressive increase in activity, which is reassuring to see.
Recent reports suggesting that NHS waiting lists could hit 10m patients by the end of the year, up from the current 4.2m, will likely mean that there is a large demand for private healthcare from patients who are not prepared to wait.
We are beginning to see the private healthcare sector start the process of opening to meet this demand through the gradual return to face-to-face outpatient consultations and the releasing of theatre capacity by the private hospitals.
The major trend of the last decade was the growth of the self-pay market and we fully expect that this sector will form a significant portion of the recovery.
There have been many reasons for the increase in the demand for self-pay over recent years and here are the major ones:
With approximately 10% of the population having private health insurance, this means that when the remaining 90% of the population sees that the NHS is experiencing difficulties, an increasing number of patients will elect to access the private sector.
With headlines in the press suggesting rising NHS waiting lists, this demand for private healthcare will only continue to increase.
We know that the number of patients accessing acute care has reduced during the Covid-19 crisis, which means these conditions have gone untreated. This will translate into a build-up of more complex problems for the future.
Wealthy elderly patients
Older patients who have benefited from rising house prices are in a better position to access private healthcare than ever before. Combined with greater quality of life expectations, this means that they are much more likely to chose to access private care than previous generations.
To control the costs of the premiums, insurance companies have amended their policies to include ever-increasing elements which are not covered by the policy.
This can be for a variety of reasons, including benefit limits, patient excess on the policy, coshare policies – where the patient agrees to pay a percentage of each invoice – and certain procedures being excluded.
If your practice is based in central London, then this has always been a part of practice life, with patients coming from outside of the UK seeking private healthcare.
This area was immediately impacted by the shutdown and the reduction in air travel, but we expect the demand from these patients to return as restrictions continue to be relaxed.
The impact on mental health of the coronavirus and the lockdown is well documented. This sector proved to be more resilient than other specialties, as practitioners were able to quickly transition to remote consultations and I am now hearing from practices that they expect this option to become part of their toolkit in the future.
Self-pay typically forms a large proportion of the patient demographic of practices in this field.
It is important to note that, across our client base, the selffunding patient is either the largest or second largest payment source. Some of the practices we manage comprise of 90% self-pay.
From the reasons I have already discussed, we expect this sector to make up a large percentage of the recovery and so it is important that you maximise the potential of this key area.
Remember, self-pay patients benefit the practice because, over a period that has often only seen the steady reduction in fees, this is an area where the consultant has complete autonomy.
Consultants can set their fees purely based on factors such as their experience, the demand for their services and competition. If you have not updated your fees in a while, this could be a good time to conduct a review of your fee structure to ensure you optimise your income.
Considering the importance of the self-pay sector, it is vital to make sure that these patients are dealt with correctly from both a billing and collection perspective.
Unfortunately, in our experience, this is rarely the case and there is quite often a lack of clarity regarding the billing of self-pay patients and, more importantly, the collecting of outstanding money.
This often results in the practice having a large amount of outstanding debt, which is either chased intermittently or not chased at all, resulting in debts that can quite quickly mount up to a significant sum of money.
The reasons for this debt can be attributed to many factors, but typically what we see is a lack of robust procedures in place to deal with these patients.
Ask yourself this question: do you know the percentage of your practice that is self-pay and what type of self-pay patients they are? In my experience from conducting reviews of practices, consultants consultants are constantly surprised about the size of the self-pay element of their practice.
It is vital that your practice has systems in place to deal with each element of self-pay listed below:
For UK self-pay patients, you need to have a published price list or to have notified the patient of their fee in advance.
It is good working practice to also confirm both the methods of payments that are available as well as when payment is due, so that the patient will not only expect an invoice but also understands how they are to pay.
At MBC, we have a variety of methods available to offer our clients and these are tailored to the needs of their practice.
Most commonly, we invoice patients after their treatment and this is usually by email that includes a link to our payment portal, which enables the patient to pay 24/7.
We also have the options to invoice patients in advance for treatment, where required, or to collect payments on the day via our Client Self-pay platform.
When you are invoicing patients post-treatment, you will need to put in place a robust system where the patient is chased for payment after an agreed period. Then ensure this is repeated on a regular basis until payment is collected.
Failure to do this is the most common reason why debt levels increase and can lead to cash flow difficulties.
If you are going to see a patient who is not a resident of the UK, it is even more important to make sure your fees and method of payment are made clear. Once they leave the country, it is extremely difficult to collect what they owe you.
When we deal with these patients on behalf of our clients, we commonly collect money in advance of treatment.
Where payment is collected by the hospital, then we raise an invoice to the hospital for your fee. It is important to follow up with the relevant finance department to ensure these payments are made to the practice – hospital administration can vary.
Even the most efficient practices find this challenging. And often it is the cause of a significant proportion of their outstanding debts.
This is because most patients do not review the terms of their insurance policy and assume that all costs are going to be met by their insurer; so when they receive an invoice for an outstanding balance not covered by their insurance company, this can come as a shock.
We find a lot of patients will ignore the invoice, thinking that it is either a copy of what has been sent to the insurer or that their insurance company is liable. So it is important to follow up with the patient directly and explain why they have received an invoice.
A large part of what we do on behalf of our clients is liaise between the insurer and the patient to ensure it is clear who owes the money. Some patients will wish to contest this with their insurer, as they believe the latter are liable, and so it is important that any issues are highlighted as soon as possible to minimise delays.
Once the patient accepts that the money is owed by them, then steps need to be put in place to chase outstanding balances and take payment.
Self-pay has been the growth sector in private healthcare in recent years and as I have highlighted in this article, it is likely to be key to the recovery. It is important that you review how you manage these patients in order to improve your cash flow and help it recover as quickly as possible.
Of course, a good alternative is that you could choose to partner with a billing company which has the expertise and skill set to remove this burden from your practice.
Simon Brignall is director of business development at Medical Billing and Collection
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