Play your cards right for the best rewards

"Michigan woman collects big time!" "Private duty care head reaps three million dollars! Credits system and college students for success!"

Sound like the tabloid headlines you see while you’re waiting to check out at the supermarket? Three months after becoming executive director of the private duty arm of Henry Ford Extended Care in Southfield, MI, Lea Wilson, RN, MBA, designed a process that made those make-believe headlines true. When Wilson assumed her post in October 1996, she was dismayed to find that Henry Ford’s outstanding accounts receivables dated back two years and there was no system in place for aggregate billing. Bills went out when the person responsible for sending them got around to them.

"Henry Ford private duty concentrated on providing great service, but overlooked receiving monies for the accounts," Wilson says. "Maybe in the past you could do that, but it makes no sense in today’s business world."

Others in administration wanted to write off the old accounts. Wilson chose to go after them because she believes "old money can be spent."

"I separated the insurance companies from private accounts and governmental accounts such as Medicaid, then contacted the critical people in those settings I thought I might be able to have a productive dialogue with. There were a couple of instances in which people said, We just don’t do anything after two years, so your time is up.’"

Four steps to collection

However, there was no time limit specified in the agreement to pay for services. Wilson designed a four-step collection system and hired accounting externs from three local business schools, dividing the accounts between them alphabetically. The externs worked for free. They needed to have some on-the-job experience in order to graduate.

"Thank heaven I had students who were eager and energetic and loved accounting!" Wilson says. "Some accounts were cleared up by phone. Some we sent letters for and followed up with a phone call. If a company had multiple accounts, I would put on a business suit and visit the corporate office of the insurance company to meet with the adjuster."

Wilson met with many companies in many places. She traveled to the state’s capitol to reconcile Medicaid program accounts.

Sometimes an insurance company had considered the initial bill inaccurate and requested a review and resubmission of the bill that had never been made.

"Typically, insurance companies have a turnover of staff and a turnover of accounts," Wilson says. "Sometimes if the file was thick and difficult to read, it had been put at the bottom of the pile and stayed there. Often, I dealt with adjusters who weren’t even employed by the company at the time the initial claim was made. We had to review each entire account file and match the visits billed for the services rendered in order to improve the accuracy of the bills."

For some accounts, the data that corroborated the charges couldn’t be found because it had been moved into storage and misfiled.

"Those accounts we had to give up on," says Wilson, "or we’d be there now looking through the archives. We had to remove from all bills any visits we could not prove by nurses’ notes or the client’s signature for services."

On some accounts, Wilson negotiated settlements instead of collecting the entire balance due. Overall, more than 75% of all monies due were received. "Sometimes the client had died and I had to deal with conservators," she says. "There were numerous responsible payers (but they) were out-of-state family members of former clients. Many of my negotiations were with insurance companies for catastrophic coverage policies, workers’ compensation cases, or motor vehicle accidents." Some of these companies were out of state; some had even been purchased by other insurance companies by the time Wilson began her collection process.

The system is as simple as it is effective. Clients must first fill out and sign the verification of service form, shown below:


Date: ______________________

Dear _______________________:

This communication is to verify coverage for private duty services for the client named below, pursuant to our recent conversation. After you have reviewed the information, please sign and return in the envelope provided. You may contact this office at (xxxx) — if any questions arise.

Your cooperation is greatly appreciated.

Client Name ________________________

Telephone Number ___________________

Address ___________________________


Street/City/State/ZIP code

Subscriber Name _____________________

SS # _______________________________

Employer ___________________________

Telephone Number ____________________

Employer Address _____________________


Street/City/State/ZIP code

Insurance Company ___________________

Telephone Number ____________________

Billing Address _______________________


Street/City/State/ZIP Code

Insurance Claim Number _______________

Policy Number _______________________

Contact Person/Title __________________


Coverage of Visits ____________________


Client’s Copay/Deductible______________


Authorization Number ________________


Services Authorized/Number of Hours/Visits

( )Registered Nurse ____________________

( )Physical Therapist ____________________

( )Occupational Therapist _________________

( )Speech Pathologist ____________________

( )Master Social Work ____________________

( )Aide ____________________

Service Rates Quoted: Shifts/Visits

weekday am $__________hr/RN___________/visit

weekday pm/mn $__________hr/PT___________/visit

weekend am $__________hr/OT___________/visit

weekend pm/mn $__________hr/SLP___________/visit


High Tech/Specialty Differential $hour or ____________

Holiday Differential ___________________________

Overtime Approved? __________________________

Weekends Approved? _________________________

Additional Information to be Included with Billing:

_____RN Notes_______ Clinical Monthly Summary

_____Therapy Notes _______ MD Orders

_____Nurse Aide Orders_______Other?_________________________

I authorize the above services and agree to pay the stated service charges within 14 days from billing date.

Authorization Signature:______________________


(Insurance Representative)

After the services are rendered, the initial bill is sent. If there is no response, the following letter is sent:

Re: _____________________

A recent audit of our records indicates a delinquent balance for services rendered for the above client.

Please review the enclosed detailed report and submit the past balance immediately.



Hit em where it hurts

Wilson has found an important lever to use at this point. Writing a letter notifying the recipient of services that his or her insurance company is not paying the claim usually convinces insurance companies to fork over the funds. "You’d be surprised how mad even a sick client can get," she says. "After all, they’ve been

paying their premiums for health care coverage in good faith. When they learn their claim is being ignored, they often call their insurance representative and raise the roof on your behalf."

However, sometimes even pressure from the insured doesn’t result in payment. The following letter then goes out:

Re: ______________________________

Account Number:____________________

Dear ______________________:

Our records indicate a past due balance on the account referenced above. A letter was mailed last month requesting payment of the delinquent balance to prevent transfer of the account to a collection agency.

We received no response from you.

Be reminded that signatures are received from the client or significant other at the initiation of in-home care and upon each subsequent care visit. We are in possession of such signatures agreeing to pay for the services received as reflected on your bill.

Your failure to resolve this past due balance will result in transferring the account and accompanying promissory statement to pay us to legal collection authorities who will act aggressively on our behalf to secure payment.

Account transfer will occur without additional notice on (date).



A period of grace

"Even though the letter says we are sending it to collection, we do allow a window of time for mail delivery," Wilson says. "When I first came here, we sent two accounts to collection. They wanted to pay up because they didn’t want their credit involved and we had to go to the collection agency and pull those accounts."

It took nearly two years to handle the old accounts receivables. But when the process was complete, Wilson had brought in well over $3 million for Henry Ford Extended Care. She hired two of the students as full-time employees and they are still with her. "They were so attentive to detail and they didn’t want to go home until all the figures matched up," she says. "I figured I needed them to stay!"