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Howard Speaks Howard Farran, DDS MBA, MAGD

More by this author (315)

CYA: Cover Your A/Rs

Howard Farran, DDS
MBA, MAGD
Publisher,
Dentaltown Magazine
 Pop quiz, hot shots: What is your total accounts receivable number in your office? Is your monthly statement stack higher than the popcorn ceiling in your office? Do your patients come to your office prepared to pay their portion at the time of service?

I have read countless threads on the Dentaltown.com message boards over the last few months dealing with these questions, and the number-one collections issue I read about, day in and day out, is how to get patients to pay their bills. There are a lot of dentists out there who are frustrated with patients they just treated who leave the office without paying their portion of the bill. One of my favorite posts (as seen in the margin at left) is by "drtucson" from the message board thread titled "Do patients pay there [sic] copays before or after treatment in your office?"

Drtucson's post may be laced with just a hint of sarcasm, but there are dentists out there who let this happen all the time. Does this happen in your practice? Do you work on patients and allow them to leave your office without paying their portion and bill them later? Man, I hope not.

In today's economy it is even more important to be proactive in having systems in place to ensure you are collecting what you are producing. At Today's Dental, our financial policies are included in the new patient paperwork as well as on our Web site. It is important to present a form that patients are required to sign explaining your financial policies and their financial liabilities. Reinforce that insurance portions are estimates only and ultimately the balance is the patient's responsibility. Here is a link to Today's Dental's Insurance and Financial Policy form (.pdf) on the Dentaltown Web site.
"drtucson"
Posted: 12/21/2008
Post: 9 of 14
Total Posts: 194

Paying later is normal. When I go to the grocery store I always tell them to bill me and I walk out with as many groceries as I need. They are fine with it. Sometimes the cops are called because they think I'm stealing, but I tell them I'm not because this is what happens at dental offices all the time.
When a new patient calls our office we ask for their insurance information over the phone so benefits can be verified prior to their appointment. Take the time to make the phone call to the insurance company as you can get detailed benefit information for that patient. Some insurance companies have great Web sites that can be utilized as well. Knowing what benefits they have already used is only one of the key questions we ask. We have found, over the years, that shortcuts taken in this area with an add-on insurance benefit software or using default insurance breakdowns within your practice management software will only make your receivable dollars grow. The goal is to collect the patient's portion at time of service, collect the insurance portion and not have to send a statement. Whether the insurance pays on seat (not prep), or if there is a waiting period, or a missing tooth clause, or a non-duplication clause, or if the patient has maxed out his/her benefits – all will result in unhappy patients who owe money after the fact. Here is a link to the fillable Insurance Breakdown form (.pdf) our office uses.

Other useful tools within our practice management software are the insurance bluebook and the fee schedules. The insurance bluebook keeps track of the allowable amounts per code for each plan, which makes your insurance estimation more accurate. Multiple fee schedules enable you to attach a specific fee schedule to your patient, which is used in place of your cash fee. Make sure your front desk staff is fully trained on your specific software.
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Howard Farran, DDS, MBA, MAGD, is an international speaker who has written dozens of published articles. To schedule Howard to speak to your next national, state or local dental meeting, email colleen@farranmedia.com.

Dr. Farran's next speaking engagement is April 24, 2009, at the Oklahoma Dental Association in Tulsa, Oklahoma. For more information, please call 480-718-9914.

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There are two additional areas you need to focus on, which, by the way, were both tough hurdles for me to get over:
  1. Talking with patients about money;
  2. Doing dentistry that has not been financially approved.
First thing - Doctor, stop talking about money in the operatories. Patients know we dentists all have soft hearts and don't want to deny anyone necessary dental care. Trust me, talking money in the operatory will get you into trouble every time. I have learned to let my front-office staff take care of all money and payment issues and it absolutely works! Second - If you find another filling or crown that needs to be taken care of, don't proceed until you have gotten written financial arrangements to proceed, even if you are already "working on that side anyway." Increasing your production without a financial commitment from your patient will grow your receivables, frustrate your staff and irritate your patient who is not prepared to pay that much today. It's so much easier to not create the accounts receivable in the first place than to try to collect it after the fact.

Sure, a miniscule portion of your patients will lie, cheat and steal in order to get the dentistry they need, but for the most part, people understand that your services aren't free and they'll work with you and your front desk to develop a payment plan. It just doesn't make sense, especially these days, to pay one of your staff members to go after delinquent accounts - or worse yet, to hire a collections agency, which can charge fees upwards of 30 percent per collection, to get the money you should have obtained up front in the first place. You might as well set a pile of cash on fire. Figure out all payment arrangements before you start to work on your patients, or you're going to pay later.
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