Increasing Early Patient Payments Starts with a Change in Mindset

Jorge Wong, for HealthLeaders Media, November 17, 2008

Hospitals and physicians interested in collecting patient payments earlier in the patient care process ought to know two very important things before providing service: how much to charge and whom to charge. But most providers are not accustomed to gathering this data up front and answering pricing questions from patients concerned about their increasing out-of-pocket financial liability. Consumerism in healthcare is creating a demand for providers to be able to tell patients what a procedure is going to cost before the service is rendered. While this demand may be challenging, it is also a unique opportunity for providers to better communicate with patients and increase their point-of-service collections.

The first step for any provider adjusting to consumerism typically has to be changing the psychology of staff to more retail-oriented front-end service. It must start at the executive level of the hospital or health system and filter down to every front-end staff member. Registrars and admissions personnel must have the tools to be able to collect patient payments—and more importantly, they must be properly trained to use those tools effectively.


Hospital management should not take for granted that front-end employees are capable of performing patient collections, because asking for money is often a very uncomfortable responsibility for someone earning a relatively low hourly wage and whose job has traditionally been more administrative and less financial.

Front-end personnel need to be thoroughly trained and educated on when to ask for money and how to ask. A communication process with supporting documents, including specific, patient-friendly scripting that is consistent across the organization, is critical. Personnel also need to be able to execute their tasks with the confidence that they will be defended by management if a patient tries to inappropriately defer payment or get charges waived.


In many cases, the same tools that providers use to collect patient payments also can be used for evaluating the performance of their front-end staff. Every hospital needs to set up a strategy and track its effectiveness.

A true revenue-generating patient collections program relies on staff accountability. Hospitals should create metrics and daily reporting to track several key indicators, including the overall performance of front-end staff. Management should continually monitor data for increases in the quantity and quality of collections. In other words, management should identify which front-end employees are collecting and how much they are collecting in comparison with the stated goals. These metrics should then be used for routine performance reviews with individual employees. Further, the hospital should, over time, incorporate feedback from the patients that participated in early collections and combine this personal feedback with the metrics data.


Employees are more likely to meet goals and even outperform when they are given incentives. Creating a program for rewards, bonuses, and other compensation using the aforementioned metrics motivates staff to move past any reservations about asking for money and apply the training and tools that have been made available to them.

Employees who excel at their jobs tend to have higher job satisfaction and better productivity, which has a positive influence on their coworkers and patient care.


The best training won't do any good unless front-end employees know how much to charge and whom to charge, and are able to refer to accurate, real-time data during conversations with patients. Too many hospitals, however, don't have any idea of what they should be collecting until a claim is prepared on the back end. And patients are no longer satisfied with, "We'll send you a bill."

Patients who are paying more for their own healthcare expect to get at least an estimate of charges before receiving treatment, and are getting used to paying a portion up front. More importantly, some patients are using the ability to understand their charges up front to determine where they receive care.

The quickest and most accurate method for arriving at a patient payment estimate is using automated collections technology. Patient payment estimator tools tie in with the hospital's health information system and create estimates based on insurance eligibility and benefits data, the hospital chargemaster and existing payer contracts. This integration allows registrar and admissions personnel to review in detail what the patient will owe for the scheduled visit and ask for a percentage before service. Patient payment estimator tools can have a dramatic impact on cash collections and significantly reduce a hospital's receivables.

Electronic bill presentment ties in another critical element of the patient's account by giving front-end staff the ability to call up any existing amount(s) owed by a patient. For example, if a patient presents for a procedure and has an outstanding balance from a previous visit, the registrar can refer back to the charges and ask for payment on the spot. The opportunity for collections is considerably greater when a patient is on site. Electronic bill presentment reduces receivables and increases cash flow, especially when used in conjunction with patient payment estimates.

Hospitals looking to boost cash collections or at least collect earlier in the patient care process should evaluate what capabilities and tools they have, determine where they want to be, and develop a plan to get there using communication, accountability, rewards, and technology. Tracking progress along the way is important for making needed adjustments, and when all the parts adhere to the same mindset, the whole is destined to succeed.

Jorge Wong is corporate vice president of financial services Passport Health Communications, Inc. He may be reached at .
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