Any collections effort 'will bring some results'

Guide available this summer

A couple of well-known slogans give a sense of the overall lesson learned from the National Association of Healthcare Access Management (NAHAM) collaborative on upfront collections, says Nancy Farrington, CHAM, master person index/clinical data repository administrator at Main Line Health System in Berwyn, PA.

"Like Nike [says], 'Just do it,'" advises Farrington, who served as part of the faculty for the project. "Or, to paraphrase Kevin Costner, 'If you ask, they will pay.'"

One of the reasons the collaborative included a mix of small, large, urban, and rural hospitals was to test the idea that success was not determined by those factors, she notes, and that is in fact what the results showed.

"Any effort will bring you some results," Farrington says. "So get organized and start doing it."

There were no characteristics that were found to preclude a facility from having success in upfront collections, she says. Philadelphia's Girard Medical Center and St. Joseph's Hospital "are inner city, high poverty level with a high incidence of substance abuse and they had success."

So did Mt. Graham Medical Center, a 59-bed facility in rural Safford, AZ, with only 5% self-pay patients, Farrington says.

The only overriding requirement is keeping focused and committed, she adds. "We did have challenges among a couple of hospitals that got diverted by other projects. If you lose focus, you lose revenue, or you increase the costs associated with getting it."

In addition to data gleaned from the collaborative, Farrington says, NAHAM also obtained information from other members who have upfront collections programs in place.

As a result, NAHAM is preparing a guide to upfront collections that will be available this summer on a CD, she notes. "It will contain sample forms and letters that people can copy and modify for their use, as well as other materials — such as policies and procedures — that can be used as models.", with a discount for orders paid for by May 31.

Access managers and directors looking to implement an upfront collections program — or build on one already in place — might want to keep in mind the following insights gained during the collaborative and from other members' experiences, she says.

  • Hospitals where there was strong administrative support, at the vice president level were much more successful than those in which all the impetus came from within the access department.
  • A key factor in emergency department collections was creating a place for people to go through the discharge process and make their payments. "You can't have financial discussions upfront," Farrington notes, because of EMTALA considerations.
  • Provide information to patients prior to their arrival — not just the specifics of their financial obligation, but the fact that an upfront collections procedure is in place, and the reasons why.

Some of those reasons are that "it's the patient's obligation, insurance never pays 100%, and it saves money for the hospital so it can continue to provide excellent service," she points out. "One hospital put notices in the paper that they were going to do it."

  • It's important from the patient's perspective to universally apply whatever message you use. If there are centralized and decentralized registration areas, for example, "you can't ask in one place and not another," Farrington advises.

"Accept payment in every possible location and type of funding — not just cash or credit card, but by whatever means the patient has available and at every point of entry."

  • Hospitals should not feel that they will alienate patients by asking for payment in competitive marketplaces, even in places where competing facilities are not collecting upfront.

"It seems that even in the places where [competitors] were not already doing it, hospitals still had success," she says. While it's important to acknowledge that patients have a choice, and to thank them for choosing your facility, Farrington adds, "those choices are not based on whether the hospital collects upfront or after the fact."

  • Some organizations offer discounts for prompt payment, but not all do. NAHAM surveyed it members doing upfront collections, she says, and only 42% indicated they had such a discount.

Some of those who did offer a discount said they took that step in order to take their collections program to the next level, Farrington says. Such a move is understandable, she notes, considering how expensive it is to collect retrospectively.

  • Hospitals that reported the most successful collections programs (measured by low accounts receivable [AR] days) in the NAHAM survey were those that did not hire consultants, but used their own internal resources.
  • The more effort expended to identify the patient's financial obligation, the more successful the collections program was likely to be. That means not depending solely on what the patient says the deductible is, Farrington adds, but checking the information with insurance "cheat sheets" and on-line eligibility systems.
  • Hospitals with the lowest AR days did not put as much emphasis on routine and recurring outpatients, she says, but gave greater attention "where they will get more bang for the buck."

Duplicate medical records next focus

Later in 2006, with the exact date yet to be determined, Farrington says, NAHAM will begin a collaborative on patient safety and duplicate medical records.

"With the growing trend toward electronic health records, this becomes more and more of a liability and patient safety issue," she points out. "When a patient has part of his or her clinical [history] on one record and part on another, the care provider doesn't have the complete picture.

"There is also a lot of administrative expense associated with it," Farrington adds. "If you make a mistake, it goes to 30 different places, but the correction doesn't [automatically] follow. It has to be done 30 times."