Your Medical Practice As A Revenue Funnel - Stopping the Leaks in the Front & Back Office

TSIToday Getting You Paid Faster

Your Practice As A Revenue FunnelStopping the Leaks in the Front & Back Office


Review of Other eBooks In This Series

Getting paid often comes down to a set of certain psychology triggers.

Simple Psychology

There are certain things you can and cannot do in patient collections (legally anyway), and most of the most common legal efforts are ineffective. Patient collections needs to be re-considered.

Playing Hardball

The Rosenthal EffectYou tend to get paid what you expect to get paid. Getting paid is more about respect than money. People have money, they just aren’t paying you.


Want to learn how to re-train your patient base to actually pay you?

Reach out to me to schedule a FREE, personalized 20-minute consultation now.

Email me at…[email protected]

Brad McDaniel, MBA


3 Stages in Patient Interaction

Pre-Appointment


Think of Your Practice As A Funnel

Appointments Set

Patients Served

$$ Collected $$

- 100 appointments set- 85 patients seen- 60 patients paid their portion= Profit-Killing Leakage!

We want your funnel to be fatter. Like this….

Appointments Set

Patients Served

$$ Collected $$

- 100 appointments set- 98 patients seen- 90 patients paid their portion= Profit-Spiking Cash Flow!


Where Do You Start Fixing Things First?Counter-intuitively….in the Back-Office.

Appointments Set

Patients Served

$ Collected $

- 120 appointments set- 115 patients seen- 70 patients paid their portion= Back-Office Bottleneck!

What would you be communicating to the 50 patients who never get a call or past-due letter?

So fix the bottleneck in the Back-Office first, then scale.


21950’s MethodologyGetting Unstuck From Old Ways of Thinking

Or… Cleaning-UpLooking at Post-Appointment Communications


3 Stages in Patient Interaction

Post-Appointment

Pre-Appointment

At-the-Appointment


The 2-Stage Approach to Collections

Stage 2Hardball

Collections

120+ DaysVerbal/Legal Demands

** The ACA reports that the typical hardball agency collects only 5-10% in medical for a fee of 33%.

Stage 1In-House

Efforts* The average cost to chase past-due patients is $8-12 per patient each month!

Current 30 Days 60 Days 90 DaysStatement Statement

Past-Due LetterStatement

Phone Calls Statement

Phone Calls

**It costs 3-6% to use a billing co which still equals $7-15 per patient (since the avg bill is $250-350)


Confession:Want to know what your overly-busy billers would love to tell you, but are scared to confess?

They aren’t calling all the past-due patients.Actually, it’s not even close.(Not even at your billing company).


100% - The past-due account list

40% - The calls they actually make

70% - The calls they make that

lead only to voicemails!

Please don’t blame them.

They simply don’t have enough time!

They don’t really follow-up after one call.

Its not their fault.


The Bad News Is...

Ouch.

Patients who would-have paid with a handful of reminders

Which both upsets them and...Results in you paying 30% of your revenues.

Instead get sent to hardball collections...


Stage 1In-House

Efforts

The 2-Stage Approach to Collections

Stage 2Hardball

Collections

120+ DaysVerbal/Legal Demands

*The average cost to chase a past-due patients is over $8-12 each month!

Current 30 Days 60 Days 90 DaysStatement Statement

Past-Due LetterStatement

Phone Calls Statement

Phone Calls

** The ACA reports that the typical hardball agency collects only 5-10% in medical for a fee of 33%.

**It costs 3-6% to use a billing co which still equals $7-15 per patient (since the avg bill is $250-350)

Wake-Up: This process is not really happening.


Dirty Little Secret:Wanna know why your collection agency recovers only 5-10% of your money?

They aren’t calling all the accounts you submit.Actually, it’s not even close.


100% - The debts submitted to the

agency

25% - Calls they make.

5-10% - Amount Collected

Please don’t blame them.

Like your billers, they simply don’t have enough time!

Its not their fault.

Unless your balances are over $1500,Then they get cherry-picked...

For the biggest and youngest balances.Its called “skimming.”

30% - Collection Fee

The Ridiculous Math Of Collection Agencies


$10,000 Debts Submitted

10% Recovery Rate

$1,000 Total Collected

30% Agency Fees

$300 Total Fees

$700 Total Back to Practice

If you turned over $10,000 in any given month to your agency...If We Put Real Numbers To It...It Looks Like This

Ouch! A measly $700 out of $10,000?


Double Ouch.

You are writing-off FAR too many patient dollars each year who have literally never even been contacted by your billers.

Not even once.

The Bad News Is...

(Think of all that money!)

Or your agency.





Brad McDaniel, MBA


3The 4-Stage Escalated ApproachThe Right Stimuli at the Right Time for Each Kind of Payer

Real-World, Everyday Cashflow

Cash Comes In... And we start paying their 1st stack of bills...the “have-to-or-else!” bills

This begs the question:Who in stack 2 will be made a priority and ACTUALLY get paid the few remaining dollars?

We start making decisions about who to pay and who to dismiss/stall.

With Only So Much Cash Left Over...

Stack 1 Gets Paid Rent, Utilities, Phone, Food, Gas, Car Note, etc

Stack 2 Gets SortedBeauty Products, Plumber/Pest/Alarm, Dining Out/Coffee, Dental/Medical, Vacations/Gifts, etc


Mon

ey A

ctua

lly R

ecei

ved

# of Days in Receivables

Collectability

Age Is More Critical Than You Thought

Ouch! Each month, 10-15% more of your A/R is becoming uncollectable.So your stalling to escalate things might be costing as much as payroll!


The 4 Patient Payers & 4 Stimuli

Doesn’t this make sense?Wouldn’t it be great to have an A/R toolbox like this?

The Reliable Just One Bill

Reminder NudgesThe Messy

3rd-Party ImpactThe Disrespectful

Live CollectionsThe Hardball


Compete Using FrequencyHave you ever noticed how most companies...

Why not join the competition for payment?Why not get out of the “second stack of bills”?Why not re-train your patients...to actually pay?

Are clamoring for their money... except doctors?

Your utility bill?How long can you go without paying you cellphone bill?Case in Point

Your medical bill?

Automate Everything Possible

EHR

Patient Registration

e-Lab Results

Appointment Reminders

Payment RemindersWhy pay

staff to chase patients?

e-Scripts

Why pay staff to chase vendors?

E-Claims/ Statements

Why pay staff to chase payers?


Wanna know what is better than the “2-Stage Approach to Collections”?

Is this a system that you’d like to try yourself?

The 4-Stage, Escalated Approach to Patient Cashflow1 The

“Disrespectful”Need 3rd-Party Soft Demands

The“Hardball”

Need A Live Call From A Pro

The “Faithful”Need Just

A Bill

The “Distracted”

NeedReminders

2 3 4

You see? A different stimuli with each kind of payer?

50-60%

5-10%15-25%

20-30%

3-5%


What if I said that…“There’s an app for this”?

Transworld has apps that do this…automatically!A/R toolbox, integrated, all for a flat-fee around $10/acct.

#2 - Friendly 1st-party reminders get sent each week to the “Messy”

#3 - 3rd-party “soft” demands go out weekly to the “Disrespectful”#4 - Live collection calls are made to the “Hardball Debtors”

#1 - You send a bill like you normally would to the “Reliable”Here’s the New Process Using the App

Transworld Systems Getting You Paid Faster

Sneak Peak At The ResultsWolfchase Clinic OBGYN 1st-party remindersWent from 27% to 83% in the 60-day column

Desoto Eye Care1st-party reminders They get 44% with a few reminders.

Brockmore Clinic1st-party reminders In a poor rural area, they even get 33%!

3rd-party demandsThey get 72% with diplomatic collection demands.

3rd-party demandsThey get 46% at a 12.6% cost...ROI is 8-to-1(Compare this to your agency that collects only 10% and charges you 33%)

3rd-party demandsThey get 14% on 14 month old accounts! A 3-to-1 ROI

* These are average results from real everyday practices just like yours. **Source: ACA International’s Top Collection Markets Survey, Jan. 1 – Dec. 31, 2013.

The “Soft” Collections Effect

Soft* Hard**

Is there any real difference between “soft” vs “hard” collections?

Prim

ary

& In

tern

al

46.7%recovered

Har

dbal

l A

genc

ies

21.8%recovered

Fam

ily M

edic

ine

38.7%recovered

Endo

& D

iabe

tes

33.5%recovered

Neu

rolo

gy

46.8%recovered

Der

mat

olog

y

49.9%recovered

Surg

ery

Cen

ters

51.4%recovered

Ort

hope

dics

38.2%recovered

Wom

en’s

Hea

lth

39.2%recovered

Pedi

atric

s

55.7%recovered

The Collection Agency Test

Healthcare Collection

Specialists?

Interface with my PMS?

Offer Fixed Fee Service

Options?Offer

Soft & Hard Collections?

Endorsed by Healthcare Experts?

Compliant w/ FDCPA &

TCPA?Offer 1st-

Party Reminders?

Easier Harder

Can your agency pass this test?

If not, you might start looking again.

There are over 4000 collection agencies in the US.

Yet only one is endorsed by the MGMA, AMA & HFMA…

Transworld Systems.

Here’s why…


The 4 Core Issues In Back-Office A/R:1)Escalate Earlier. The longer you wait to get

serious about collecting, the less likely you’ll ever see a dime.

2)Segment the List. You must use the right stimuli at the right time with the right kind of patient payer.

3)Compete Using Frequency. One contact a month is not enough. Be the “squeaky wheel” to get the “oil.”

4)Leverage Automation. Automate as much of your revenue cycle, from claims to patient A/R, to free-up your staff.



Want to see our automated app in action?



Brad McDaniel, MBA

Your Medical Practice As A Revenue Funnel - Stopping the Leaks in the Front & Back Office

Healthcare

Transcript of Your Medical Practice As A Revenue Funnel - Stopping the Leaks in the Front & Back Office