So how and when do you go about dropping a PPO? Contrary to what you might have heard, you don’t necessarily start with the PPO’s with the lowest fee schedules. There are other factors involved such as; the size of the PPO in your practice (smaller is better if you’re learning how to go through the drop/transition process), the out of network benefit sets, and whether or not the company is a pain for your administrative staff in processing claims.
For starters, I advise Doctors to peel off a PPO that is about 10%-15% of their practice. Typically, Doctors are taking their 30%, or 40% discount on that PPO. So, if they can peel it off and otherwise keep most of the patients (and they will if they do things right). They can add 5 or more points to their collection percentage.
When going through those transitions there are two objectives:
- To minimize any loss of patients.
- To slow down any loss of patient.
When evaluating these situations, I ask the Doctor to assume if they lost half of the patients in a given PPO, would their practice have enough underlying vitality to “heal up” over that loss. Actually, if you do things well, you will not lose half, but for arguments sake, make that assumption.
If a PPO is 15% of your practice, and you lose half of it, that’s 7%. If you lose 7% of your patients next month, that can certainly hurt. However, if the loss of 7% of your patients is over two years you have plenty of time to “heal up” or counteract those losses. Meanwhile, you’re collecting more and gaining more control over your own practice.
So how do you minimize patient loss? By training your staff so they know how to tactfully deal with patients in, and out of network. The key is not to make too big a deal about it. Again Doctor, you’re already seeing patients out of network. If you accentuate the positive, and the patients otherwise like your office, you’ll be fine.
“You’re lucky to have insurance. We’ll do our best to get the most out of your coverage here!”
“The good thing about your insurance is, you can go to the Doctor of your choice.”
“We work with many insurances both in, and out of network. Patients with XYZ insurance have had good benefits here…”
How do you slow down the loss of patients? For one thing, avoid writing letters! For some reason, Doctors reflexively feel they must send letters when they drop a PPO. This can cause a lot of confusion and damage to your practice. Not only will mass mailings cause a greater loss of patients, it will also speed up any loss you have. Also, it could be dangerous to send letters because if you say something the insurance company doesn’t like, they may go after you.
We feel it’s best to talk to patients face to face. We feel that is best because you can see the patient’s body language and hone your message. Or, you can send out small batches of letters and follow up with calls. Or, you can go with a phone campaign. You work to call patients in for recall appointments, it’s definitely worth it to organize a phone campaign to talk to patients regarding the transition.
As a rule of thumb, I don’t recommend sending letters to insurance patients unless the insurance company is sending letters. Most of the time they don’t because again, they don’t want to stir up bad feelings either.
Look for part 3 next week
...What can you expect?