Improving revenue performance is a challenge for any provider, and collecting co-pays prior to services can go a long way towards accomplishing that goal. In this Q&A, Sherry Dwyer, MBA, practice administrator, Bariatric Medical Institute of Texas, explains how her office was able to reduce aged payments nearly 50%, improve communication with patients, and grow its business.
Q: What challenges to growth were BMI of Texas facing and what did you do to address them?
Dwyer: Our problems weren’t that different than those of any other practice. In 2012, we decided to focus on growth with a goal of scheduling more surgeries. We managed to perform 75 more procedures without adding another surgeon. But, our cash flow was absolutely flat while my doctors had been hoping for another $100,000 cash flow. That’s when we decided to take a look at what we needed to do differently. We knew that we had a payer-mix change, but we'd missed so many opportunities to collect the patient portion. I was attending the Raintree Conference – they’re our EMR provider – around this time, and that’s when I heard about Patient Estimation from ZirMed. I quickly realized it fell right in line with our goal of getting a better understanding of our problem in collecting patient dollars. We felt we had been doing a good job of estimating, but we didn't seem to have any credibility in the patients' eyes. They didn’t believe what our estimations were, because they were done on generic forms and we’d fill in blanks by hand. But the biggest problem was that the estimations were not very accurate. That's where the Patient Estimation tool came into play. We were able to make a very accurate estimate of what the patient owed out of pocket on a document that looked professional and showed them, in real time, what their insurance company said was their out-of-pocket amount.
Q: When did you implement Patient Estimation and what kind of results did you see?
Dwyer: In January, 2013 we started using Patient Estimation for patients coming right into the office, looking just for deductibles. I think every practice goes through at least the first two months of a new year dealing with everything flowing to the deductibles, and you have really short cash flow because of it. Using Patient Estimation we were able to provide the patient with a professional document and tell them, “Your insurance company says that they're going to apply this to your deductible, so we're going to ask you to go ahead and take care of it today.” Patients were receptive to that and were happy we were able to tell them where they were on their deductible. As a result, we did a lot better in January and February than we ever have in the past. Prior to that, we really struggled collecting from our patients. Our total receivable (referred to as the P-Bucket, or what the patient owes the practice) is completely netted, purely the portion that is due to the practice according to the patient's explanation of benefits. The P-Bucket is aged – it has a 0-30 bucket, a 30-60 bucket, and so on. The total on our P-Bucket at the start of the year was $157,000, which is really a huge amount of money for a small practice. It was obvious that money fell into the P-Bucket and sat there. Once it starts sitting, it gets tougher to collect. We took that $157,000 and have been able to drop it down to under $81,000 as a whole. I have to admit now that I'm very proud to say that our 0-30 and 30-60 buckets are both under $5,000 now.
Q: Did that improvement happen immediately, or over the course of the year?
Dwyer: Over time. I was watching them run at over $10,000, $12,000, $15,000 a month which was an improvement. But, I was trying to figure out why we still had money falling into those buckets. We were using the Patient Estimation strictly for our surgery cases and discovered a problem with what we call our fill clinic, or when patients come in and have their band fills taken care of. That's about 40 patients a week. They were falling into the P-Buckets as well. So, we started using Patient Estimation with them. Instead of the patient giving us their $20 co-pay, we were able to run the estimator and show them what they would truly owe so they wouldn't be carrying a balance on a regular basis. The same thought was applied to our patients that, instead of having a co-pay, were having co-insurance due. It's a whole different ballgame with their co-insurance. At the end of their visit, we're able to run this estimator very quickly. Once we have their tick sheet, we can tell them within just a few seconds how much they're going to owe for the visit. We do our best to get them to pay before they leave.
Q: It sounds like you rely on this tool pretty heavily.
Dwyer: Exactly. We didn't realize that we were going to need it for so much more. We started off thinking that it was going to be mostly helpful for the surgery cases. But, when it comes down to it, it works with the day-to-day patients as well, especially the billed cases. Those have a little higher price tag on them, and we were feeling those much more. I noticed they were cluttering up our accounts receivable, and using Patient Estimation has taken the clutter away.
Q: What internal changes did you have to make as a result of implementing Patient Estimation?
Dwyer: We had to change the job duties of one full-time employee who spent more than half her time very focused on collecting from patients prior to the procedure. And I don't think the change was unwelcome. She does all of our insurance verification and is also responsible for estimating what the patient is going to owe out of pocket. Now, she no longer has to use calculator and determine the co-pay manually based on the allowables. She just runs it through Patient Estimation and comes up with the estimation letter for the patient.
Q: What have the doctors said about the improvements?
Dwyer: They certainly like that the patient portions have increased. They also like that I'm not having such a huge number sitting in the P-Bucket. I think the P-Bucket, even though it's one of the smaller buckets, bothered them more than anything. It wasn't a grossed-up billing amount that we sent out the door. It was real and the fact that they may or may not get it. I think that was concerning to them. They have a full staff here, and we want to take excellent care of our patients, and we want patients to enjoy coming into our practice. But to accomplish that, we have to generate enough cash flow in order to keep our practice running.
Q: Has there been any feedback from patients since implementation?
Dwyer: The patients are more accepting of the letter than before. That has something to do with the staff being trained to tell them, “I just ran this in real time, directly from your insurance company, and they’re reporting where you are in your deductible and where you are with your out of pocket. This is what they say is going to be the amount you're going to pay, when this is all processed.” There's just more credibility when it came from their insurance company. It's something the patients respond to positively, or at least they believe it. It's not always easy to get money from a patient. That seems to be the more challenging part sometimes.
Q: Did this implementation and rollout require any support?
Dwyer: Initially, we had a weekly call with everybody that was in the process. Whenever something didn't look right, because there were some bugs to work out in the beginning, our business office were able to send reports electronically to ZirMed and the problems were addressed before the next meeting. There was quite a bit of communication and much of it was a quick email or call. We use ZirMed for other products, and it's been a very good relationship. They're very responsible.
Q: Were you surprised by anything Patient Estimation offers?
Dwyer: It seems that our physicians, our surgeons, are always doing a multiple procedure. They always have to calculate in an assist and Patient Estimation can handle this better than human beings – we seem to have a little more trouble getting our hands around the multiple procedures. That was a big plus. If you ask anyone who does it the way we were doing it, they'll be really happy to find out that it can do multiples. That's the one thing – it's easy to program your system to net down your accounts, but netting down the primary procedure is no big deal. But when you're trying to net down for multi-procedures, it's a whole different ballgame. We were never very successful at netting it down accurately. I used the estimator for my net downs now.
