Ultimate Guide to Healthcare Payments

Healthcare payments are a central component of the healthcare system, and ensure that health businesses and organizations are reimbursed on time. Additionally, healthcare payments are vital to ensure that patients have appropriate coverage when it comes to their treatment. We acknowledge that there are a lot of working parts when it comes to healthcare payments, and it isn’t always easy to wrap your head around these. As a result, we’ve created an ultimate guide of everything you need to know to help drive your business towards success. 

What is a healthcare payment system?

Although it seems trivial, in order to understand healthcare payments, it’s best to first define what a healthcare payment system is. While each payment system can look vastly different, depending on each organization’s needs and business goals, it essentially is a grouping of services that allow for healthcare providers to be reimbursed for the technology, services, and equipment that is used. Through patient or insurance payments, a healthcare payment system ensures that there is a streamlined system that enables patients and clinics to be paid accurately and promptly. Payment systems are the core component of revenue cycle management operations, and having a good payment system is often the difference between successful healthcare organizations and those that fail. 

Types of healthcare payment methods

There are various types of healthcare payment methods, and each one presents its own advantages and disadvantages. While there is no one size fits all approach when it comes to healthcare, you must recognize the different features of various methods, in order to select the system that best manages your business operations and needs. 

Fee for Service (FFS)

As the most common and traditional method used in the United States, the fee for service method bases patient pricing according to the exact service, product, or technology used. Essentially, patients are paying for the exact use of specific products, and each service is appropriately reimbursed. For instance, if you have a blood test, either you or your insurance company will pay for this exact service you have received. Despite this being the most popular payment method, there are various pros and cons to its operations that you should understand before you decide whether it’s best for you.

Advantages

1. Maximizes patient experience - Patients can receive a highly valued service, with an encouraging delivery of care to improve the patient experience. 
2. Flexibility of pay - Healthcare providers can charge amounts they deem as reasonable, and can offer varied assistance to patients when it comes to their finances. 
3. Suitable to all scopes - Regardless of the size and structure of the healthcare organization, FFS is suitable for all healthcare businesses.  
4. Improves accountability for patients - Patients can be charged for the exact level of service they receive, and healthcare organizations can be reimbursed for every product, technology, and resource used. 
5. Patients can decide their treatment - Many patients feel that FFS allows a variety of choices due to the lack of stipulations in place. You can decide where you would like to receive healthcare services, regardless of your health insurance plan. Patients can choose to go outside of their networks if desired, with no repercussions. 

Disadvantages

1. Less value-based care - FFS provides little to no reward for efficient healthcare delivery.  Many physicians and healthcare organizations will administer procedures and tests that aren’t always relevant or necessary to the patient in order to generate more income. Not only is this costly for patients, but can waste time and diminish the patient experience. 
2. Denial of care - If a patient doesn’t have healthcare insurance, or doesn’t qualify for Medicaid or Medicare programs, then access to medical services can be refused in various instances. 
3. Increased paperwork management - With FFS, there is a lot more paperwork involved, which requires continuous upkeep and meticulous attention to detail. Failing to keep up to date with healthcare services can result in incorrect reimbursement amounts, meaning your business will be out of pocket.
4. Doesn’t usually cover preventative benefits - FFS doesn’t usually cover preventative benefits that accompany many healthcare insurance plans, such as vaccinations, eye exams, and physical appointments. This can be costly for some healthcare organizations where they may be suffering from some income challenges. 
5. Reduced face-to-face visits - Due to immediate billing when it comes to individual services, many patients tend to opt out of visits due to uncertainty of whether they can afford the healthcare treatment. This can mean less face-to-face contact as many patients attempt to do their own research or seek alternative methods, which may be significantly less effective. 

It’s important to note that while FFS is traditionally used when it comes to healthcare payments, it has recently come under scrutiny for inherently rewarding the quantity of medical care. FFS doesn’t typically prioritize the efficiency or quality of medical care, and as a result, the healthcare space is seeing a shift from this approach towards others. Especially when it comes to more chronic patients, the FFS model tends to emphasize that sick patients are worth more than healthy patients due to the payments made in correlation to volume. 

Value-Based Reimbursement

In response to the disadvantages of FFS, many healthcare organizations are shifting towards a value-based reimbursement approach that reduces health costs whilst improving the quality of care when it comes to treatment. Sometimes known as value-based care, or Pay-for-Performance, this approach means that providers are paid according to the quality of care they deliver rather than the quantity. Doing so can significantly minimize overcharging, and can reduce the number of unnecessary tests administered to patients. Typically, models that focus and emphasize value tend to perform better when it comes to patient satisfaction and provide higher accountability that can lead to improved clinical outcomes. 

With value-based reimbursement, there are multiple healthcare payment methods beneath this umbrella term, and it encompasses a range of solutions that each have their own advantages and disadvantages. These methods include:

1. Capitation
2. Accountable Care
3. Patient-Centered Medical Home
4. Bundled Payments

Capitation

Capitation, sometimes known as population-based payment, involves providers receiving a fixed amount of money per patient, with this fixed amount centered around the organization’s data. The finances determined are concerned with demographics, the number of patients seen, the range of services provided, as well as the period of time that these services are provided. Through capitation, the insurer doesn’t reimburse healthcare providers for each service delivered, instead, there is a single payment per patient per month to a single organization. This can significantly reduce healthcare costs by only paying what is necessary, and because of its nature, it tends to target high-cost areas within the population. Methods may include reducing readmissions, shortening lengths of stay, as well as setting limits on the tests and drugs used, as well as discharging patients to their homes. However, like any healthcare payment method, it has its own challenges and benefits that must be recognized before you consider implementing its services. 

Advantages

1. Increased patient experience - With capitation, you may find that your practice experiences higher patient satisfaction, as many patients appreciate the flexibility and cost-efficiency processes associated with its service. Costs are also much more predictable for patients, which means they are likely to show up for appointments and consultations with less financial concerns. 
2. Limits unnecessary services - With payments adjusted according to patients per month, as opposed to payments based on services, there is a preventative measure that protects clinics from administering and undertaking unnecessary medical services. This means that the costs associated with each practice are more likely to be essential to their operations, and are only what is necessary. 
3. Wider variety of services - With capitation, it can be easier for healthcare providers to take advantage of other healthcare services such as telemedicine. Health organizations can now undertake services that may not be compensated under traditional models, which only reinforces a positive feedback loop in regards to patients.
4. Predictable cash flow - Fees per patient, as opposed to fees charged per service, can also mean that healthcare organizations can better understand what to expect when it comes to evaluating their finances and services. Providers can invest where appropriate, and make more informed decisions when it comes to their business, with a stable income. 
5. Less paperwork - Say goodbye to complicated billing procedures, and say hello to fast and easy processing! With capitation, you can avoid all the complex and time-consuming steps associated with other methods, as you only have to deal with fees per patient. You don’t need to concern yourself with the medical billing and coding processes of every visit and service treatment within your clinic, which makes for a super convenient method when it comes to your business operations. 

Disadvantages 

1. Less emphasis on patient-level value - While capitation can produce obvious benefits for the population at large, it tends to neglect treatments that are needed for particular healthcare issues. It can be increasingly difficult to manage the overall health of a diverse population with a multitude of healthcare conditions, and as a result, capitation payments may not be efficient for every type of health condition. 
2. Providers may only take healthier patients - Unfortunately, some physicians may have incentives to only take on healthier patients that are less time-consuming, which can mean that those who truly need help are less likely to be treated. 
3. Healthcare providers bear large risks - Because providers are paying for patient fees, it means that the cost of the population's actual medical needs is shifted over to the providers. Theoretically, insurers should be taking this responsibility on board, and providers should only bear the risks associated with the care they directly deliver to patients. As a result, many healthcare organizations tend to claim as many comorbidities as possible to cover a variety of risks, and increase their revenue and profitability. 
4. Healthcare organization competition - Because of this larger risk, and patients being unable to choose the best provider for their specific needs, healthcare providers often have a greater incentive to attract larger populations to reduce competition. This can result in a dominant system within particular regions, which is greatly disadvantageous to patients. Not every clinic offers the right technology, resources, and innovation to be able to cater to every healthcare need, and therefore, capitation can result in less competition and less specialized care. 
5. Too many patients - Because there is an incentive to attract larger populations, with increased profits, this can mean that healthcare organizations easily fall into the trap of enrolling too many patients within their clinic. This means that the patients can easily overwhelm the healthcare systems, with more clients than resources allow. As a result, organizations may have long wait times with limited appointments, which also reduces patient satisfaction and creates a stressful healthcare environment. 

Accountable Care Organizations (ACOs)

ACOs are also a popular value-based reimbursement approach when it comes to healthcare payments, and involve a group of healthcare providers coming together to provide a comprehensive care service to patients. This typically includes healthcare practitioners across a variety of settings and contexts, including, clinics, hospitals, primary care, specialty physicians, as well as others. The main purpose of ACOs is to jointly share responsibility for a large patient population and collectively oversee components of the healthcare practice such as the quality of care and cost. In conjunction with checks, balances, and accountability, ACOs ensure that patients are receiving the highest quality treatment without compromising any health aspects, all at a minimal cost and without overlap. Coordination is the absolute key when it comes to ACOs and ensuring that patients are kept healthy, and receive the care needed. 

Essentially, ACO physicians bill as usual, but their total costs are compared to an established overall target, and some of their patient outcomes are also measured. This is all to ensure that they are hitting certain benchmarks pertaining to the quality of their service, and if the costs are higher than the target, they may face consequences. For instance, ACOs may be penalized for going over the cost, however, if they stay under, they get a share of their savings. 

Advantages

1. Improved communication - ACOs work towards communicating efficiently across healthcare specialties, organizations, disciplines, and practitioners, meaning that the patient is prioritized with high-level coordination across business processes. 
2. More comprehensive care - When patients visit their medical provider, they can receive services that are directly tailored to their needs, with reimbursement only occurring based on medically relevant tests and examinations. Rather than the number of services offered, value is placed on the outcome of patient healthcare services, which can lead to improved diagnostic accuracy and greater pain alleviation. The patient is prioritized, and as a result, it is likely that patient satisfaction may also increase. 
3. Greater control for physicians - Because ACOs tend to be voluntary networks, many physicians join with a genuine passion for their work and to lead change within the healthcare workspace in the way they want to. This can work towards a much more fulfilling career experience, and allows more control over care plans as opposed to insurance agencies having significant sway. 
4. Eliminates patient expenses - For certain services and preventative measures, many patients may find that they don’t have to pay for services that they are used to with alternative models. This means patient satisfaction is likely to increase, and there may be an improvement in health and clinical outcomes. 
5. Full transparency - Because of the high-level of coordination of care needed within ACOs, electronic health records (EHRs) are easily made available to appropriate health professionals, who can then evaluate patients and provide accurate diagnoses. Fewer data transfers also means that this process is highly secure, and can result in significantly better healthcare outcomes for patients.

Disadvantages

1. Requires highly adaptive individuals - ACOs need to have highly adaptive groups of healthcare professionals in order to work and succeed. This can prove particularly difficult within the healthcare industry, as many doctors and nurses aren’t always so readily available to take on board new ideas. Individuals must be open-minded and be able to handle and communicate across an expanse of health ideas and innovations. 
2. Overwhelming number of patients - Implementing this method will likely see a large number of patients come through your doors, which can burden many healthcare organizations if they do not have the appropriate resources to handle such changes. 
3. No guaranteed success - This method is largely dependent on the individuals within the ACO group, how well they integrate and coordinate business operations and processes. Many healthcare professionals may find that ACOs prove to be time-consuming and taxing, with fewer benefits reaped. There’s also a more strenuous burden with responsibility delegated to all individuals within the team, and not just sole practitioners. 
4. Potential increase in costs - Other healthcare professionals within ACO groups may not have similar resources and capital in comparison to your clinic. It would be wrong to assume that all healthcare practices are on the same playing field, and as a result, you may find that you contribute an unequal share of expenses to the overall network. 
5. Longer time - An ACO payment method automatically assumes a lot more responsibility than various other methods, meaning that you may find it difficult to process the number of patients that you were before. This may mean reducing your patient load or having to invest in more capital, technology, resources, and staff to be able to accommodate for larger numbers. 

Patient-Centered Medical Homes

Patient-Centered Medical Homes (PCMHs) are another healthcare payment method, in which monthly payments are set on top of existing funding. This allows for a highly coordinated team of health professionals, such as nurses, doctors, nutritionists, specialists, psychologists, medical assistants, as well as other practitioners. Like ACOs, this means there is a team of providers attending to a patient and their healthcare journey. However, it is a single practice used method to provide holistic care, whereas an ACO primarily exists as a method of provider reimbursement. Within PCMH systems, there is a primary care provider, and they exist within a network to coordinate care, as opposed to the network having tied compensation with agreements in most steps of the healthcare process. 

PCMHs focus on the five attributes of patient-centeredness, care coordination, comprehensiveness, accessibility, and quality/safety to deliver high quality healthcare solutions to patients. In a PCMH model, any disposable income is used to invest in further resources to treat high-risk patients, and to overall improve healthcare business operations. This includes reducing visits overall and improving clinical outcomes, as well as eliminating other preventable issues over time.  

Advantages

• Improved practitioner and patient relationship - With PCMH payment systems, there is a strong likelihood that practitioner and patient relationships increase with greater coordination of care. This means that patients feel that they are being appropriately compensated and listened to, with higher patient satisfaction and greater clinical outcomes.
• Individualized care - Patients who use PCMH systems can expect to receive care that is directly tailored to their healthcare needs and preferences. PCMH models strongly encourage high-quality services that pinpoint areas of concern and focus on problems through extensive work and dedication across professionals. 

Disadvantages

• Limited patient input - Outside of the practitioner and patient relationship, there are limited options for patients to voice their opinions regarding their treatment due to the streamlined service that encompasses a variety of healthcare professionals. Patients may feel that they have less control over their healthcare treatment, and while individualized, they may discover that there is less involvement on their part. 
• Multiple steps required - Because there is a network of medical healthcare professionals, patients should expect that their treatment and payment may go through multiple individuals in consultations. There are also multiple steps involved on the practitioner end, and these complications make effective communication much more difficult. 

Bundled Payments

Bundled payments involve setting a single price for various healthcare treatment methods for patients, which means that clients only pay for one bundle of services. Healthcare providers will provide an estimate for the total costs of services that a patient will receive per episode over a set period of time for a specific health problem. With bundled payments, providers can maintain low costs while keeping the margin on the bundle, and insurance providers can reduce costs by creating a bundle that emphasizes savings. This is a commonly preferred method as it avoids providers having to be responsible for all costs of treatment, even if they exceed the amount of money originally given. To better understand bundled payments, it may help to examine the weighted benefits and challenges. 

Advantages

• Covers overall care - Bundled payments cover the full cost of treating a patient throughout their entire hospitalization period, and following. This includes covering all necessary services to manage complications and comorbidities, as well as the healthcare problem itself. Depending on the patient demographic, such as low-income patients or the elderly, these covered costs should reflect their position. 
• Good clinical outcomes - Because bundled payments cover a variety of services, they take extra care to achieve clinical expectations and goals by reducing, alleviating, or eliminating pain, as well as returning patients to their normal, healthy function. Bundled payments also strive to reduce any health complications.
• Only covers what’s necessary - Bundled payments are the preferred method for many healthcare practitioners as they cover full costs of care while providing a margin. It incentivizes efficient healthcare processes and outcomes and doesn’t cover any unnecessary services that can waste resources. It also means that healthcare providers aren’t responsible for unrelated healthcare issues and cases, as incorporating these costs can be difficult. 
• Adjusts for risk - Different healthcare status factors, as well as any other relevant demographic information, are reflected in the bundled payment costs. This means that healthcare providers can be rewarded for taking on more difficult patients, who may have more strenuous social and living circumstances. 
• Greater accountability - Bundled payments hold all healthcare providers accountable for improving the health outcomes of patients and achieving higher clinical procedures, as outlined in their covered costs. This means there is a greater value at risk, and so there should also be higher satisfaction within patients, with their healthcare in good hands. 
• Lower costs - There are approximately 20% to 30% increased savings with bundled payments, as it avoids overtreatment and encourages health teams to work in collaboration to efficiently deliver relevant health solutions. 

Disadvantages

• Difficult definitions - It can sometimes be difficult for healthcare providers to define what care and health services should be included within bundled payments. This is especially true for comorbidities or multiple chronic conditions that can interact with each other, as these can be very costly and can strain healthcare providers unnecessarily. 
• May inhibit holistic views - Because bundled payments focus on the healthcare services included within the bundled groups, this may mean that some healthcare professionals may fail to acknowledge other pressing health issues. Certain costs of illnesses may not be included in the bundled payment, and therefore, some specialists may view the patient as their specified illness, rather than a whole individual. 
• Risk adjustment fallibility - While risk adjustment can minimize ‘cherry picking’ when it comes to patients who are more profitable than others, this isn’t always the case. Sometimes the expense and effort involved in risk adjustment can mean patient bundles aren’t properly evaluated, and only patients with profitable bundles are taken. For example, patients with complicated problems can be less profitable than patients who only require a straightforward treatment. 
• Reduces success of ACOs - Bundled payments reduce the success of population-based methods, such as ACOs. This is because ACOs must generate savings from existing services to be successful, and if there are bundled payments, this could make things more difficult for ACOs to find savings within their own grouping of services. 

As a closing note on payment methods, we hope that this exploration of all the different procedures can provide you with a greater context in regards to how you can manage pay within your business. There are obvious advantages to each method, and each comes with its own challenges. When it comes to your healthcare practice, it’s important to keep in mind that there’s no one right way to go about it, and you must evaluate your preferences, needs, and resources. 

Staying Safe

Because healthcare payments deal with highly sensitive financial information, you must consider HIPAA considerations to avoid data leaks. Patient privacy should be one of your top priorities when it comes to protecting patient information and contact details, and ensuring high reputability within your practice. 

What is HIPAA?

The Health Insurance Portability and Accountability Act (HIPAA) is the establishment for observing how medical coverage and patient information is received and communicated. The rules outline the prerequisites that medical care organizations and practices need to comply with, to guarantee classification and protection of patient information, as well as ensure that all creating, moving, sharing, and reception of data is secure.

HIPAA upholds organizations to administer healthcare coverage when required, which includes around 200 million Americans, and it assists those who face immense challenges when it comes to accessing healthcare. HIPAA guarantees industry-wide norms for clinical processes, and ensures that healthcare practices and organizations have the relevant security measures in place to safeguard data and protect all points of information within healthcare systems. It is an essential component of health businesses that assure your patients that their information is in safe hands, and is constantly monitored and secured. 

HIPAA also outlines the consequences for healthcare organizations that breach healthcare regulations, including fines from anywhere between $100 to $1.5million USD. As a result, you must be aware of the laws, policies, and regulations concerned with HIPAA guidelines. For businesses that use online payment systems, which is most, having a thorough understanding of HIPAA is critical.

If you have signed a business associate agreement with a financial institution that provides a variety of services, such as medical billing, coding, and practice management, then you must check whether this institution is HIPAA-compliant. Failure to do so could result in costly fines and legal proceedings. 

Tips for HIPAA compliance with online payments

When using online payments that specifically involve credit card processing functions, you need to consider the following practices in order to guarantee security and HIPAA compliance.

#1 Spend time evaluating your options

Naturally, healthcare payments can be a complicated subject matter, so it’s important that the payment processors you choose only work to streamline your operations in the most efficient way possible. Taking a payment processor onboard should only work to simplify your work. 

The payment processor you choose should follow Payment Card Industry Data Security Standards (PCI DSS), and should carefully adhere to all stated laws and rules within these guidelines. This ensures that there are encryption levels within all points of communication and storage within the service, and that there are appropriate breach responses in place, as well as continuous monitoring and authentication processes. Receipts should also never be sent over non-secure servers, such as email or text messages, and taking note of HIPAA processes such as these can ensure that you are selecting a payment processor that prioritizes patient safety at every step of their operations. 

#2 Use EMV-compatible payment terminals

The most common form of global transactions is through EMV cards that utilize EMV chips as opposed to the magnetic strip commonly on credit cards. It is the most secure way to process online payments and minimize credit card fraud, as EMV chips encrypt information each time it is accessed. While payment terminals that process EMV chips are more expensive, it is the safest way to accept payments and will save you immense costs in the long run. You can avoid costly HIPAA compliance fines that occur in the case of breached information, and also avoid any blows to your reputation.  

#3 Design your own payment solution

If you have done your research and find that no healthcare payment method seems to suit your business needs and priorities, then you may decide designing your own payment solutions is the best option! If this is your decision, there are a variety of factors to consider, however the payoff will make it all worth it with increased client satisfaction, and efficiency in operations. To hit the ground running, you need to incorporate the following features:

• An easy, smooth, and simple interface so your patients can easily use the service, regardless of their technical capabilities and background. 
• End-to-end encryption so financial information and patient data is protected within all steps of the payment terminal.
• Analytical features so you can record, monitor, and analyze data to improve the payment services within your healthcare practice. This way you can easily pinpoint features that need improving, and you can easily identify your strengths. 
• There should be a variety of payment methods available, as not every patient operates with the same payment choices. This means offering both EMV chip methods and magstripe cards, as well as NFC contactless methods. 

#4 Incorporate vP2PE encryption 

Above all, you need to ensure that you have PCI-validated point-to-point encryption across all business processes, especially when it comes to online payments. You’re dealing with highly confidential patient information and finances, and it is important that cybersecurity breaches, hacks, and leaks are avoided. Encryption makes it almost impossible for external parties to access data and decipher it, as they don’t have the unique key. This makes encryption an excellent way to prevent data from being wiped and ensures that payments are processed efficiently and safely. 

Collecting Payments

Payment collection is a tedious aspect of healthcare payments, but it ensures that you are reimbursed for your services and that you can run your business efficiently. It’s of utmost importance that you are collecting the right amounts and that you avoid common pitfalls when it comes to your finances. After all, you want to provide the best care for your patients, and having the necessary funds to invest in the appropriate technology and resources will allow you to elevate the quality of your practice. 

Dos and Don’ts of payment collection

When it comes to payment collection, there are things you must keep in mind when it comes to your patients, to ensure that you’re receiving the correct amounts. 

Dos

• Use cloud-based solutions - You must use a secure data solution when it comes to storing confidential patient details and information. Uploading data onto a cloud platform is one of the best ways to ensure that patient information is kept private, and at minimal risk from hacking and jeopardization from external parties. 
• Use e-invoices and online payments - In case it wasn’t obvious, online methods are one the most efficient and secure ways to process payments. With e-invoices, patients can receive a billing invoice from any compatible device, and send you payments in seconds. It requires little effort, and provides a streamlined approach with simple steps that anyone can adhere to. With faster payments, you can receive more revenue, and greater patient satisfaction, so it’s a win-win!
• Digitalise medical billing processes - Handwriting information is tedious, and can take up copious amounts of time. It tends to be a strain on medical professionals, and can mean that more medical billers and administrative staff need to be hired. Digitalization can mean faster and more efficient payments for your healthcare practice, and can greatly alleviate the strain on many of your business processes. 
• Present invoices immediately - If billing is curated promptly, the patient is more likely to pay on time as the invoice is directly related to the services just given. There is an easy reconciliation with the job as both the value and invoice are presented simultaneously. If you take time with invoices, you are more likely to face contention from patients who may be impatient, or who do not remember details of agreement concerning the service.
• Be simple - No one likes to spend additional time and effort researching how to use a service. Your payment options should be easy to use by all patients, and should be easily accessible from those of all different technical backgrounds. All payment options should be in one place for easy access.
• Offer variety - You must provide multiple payment options so patients can quickly and easily pay for your services without having to concern themselves with learning less preferred ways. This way, patients are less likely to be behind on their payments, and you can receive full payments upfront. 
• Have a follow-up process - Ensure that you have the right protocol and staff in place to follow up on outstanding payments. This can be through email or letter follow-ups, which are less confrontational than a phone call. Calls should only be used when the patient is not responsive to their notifications, and you still haven’t received any payment. Communication is key when it comes to ensuring that patients pay on time, and that you receive reimbursements promptly. 

Don’ts

• Complexity - Complicated payment processes are very inconvenient, and patients are far less likely to pay on time, so it’s in your best interest to create or choose a user-friendly platform. If patients don’t understand the payment terminals and how to process credit card information, then it can result in frequent calls, which can be strenuous on your staff and resources. Keep it simple! 
• Outdated systems - Some payment collection processes are very outdated and can result in large costs. You must avoid high administrative costs by using the most efficient software, platforms, and process operations. Electronic and online systems are the best way to go when it comes to processing financial information, as paper statements can take a large amount of time to prepare, and it can easily eat into your resources. Using paper, envelopes, and ink, as well as the cost to post them, can be very strenuous. 
• Inconsistency - Payments are an intricate process, and in order to be correctly reimbursed, you must have the right medical billing procedures in place. Almost 80% of medical bills in the US contain some sort of mistake, which can cost practices thousands of dollars. Any mistakes need to be correctly coded without duplicate charges. If frequently occurring, your healthcare practice could suffer both financially and in regards to your reputability. 
• Lack of patient audits - Make sure that your patient information is up to date, and that you conduct routine audit checks of their details to ensure it is correct. Having the wrong information can lead to delayed payments, and again, can be a large strain on your current resources. If details are frequently incorrect, then this could lead to extensive fines for your practice, which can be detrimental. 

Why do my clients not pay on time?

If you’ve incorporated the above tips within your practice, and you still have clients that aren’t paying on time, don’t worry! There are a variety of reasons as to why patients fail to pay on time, and sometimes, it really isn’t the fault of the healthcare business at hand. The reasons why you have outstanding payments may be due to one of the following:

1. Insufficient funds - It’s possible that the patient doesn’t have enough money to pay for the healthcare treatment. Sometimes patients aren’t aware of the full costs, as well as any hidden ones, and so they simply don’t have the funds to make the payment. After all, healthcare payments are expensive!
2. Busy - The patient may have a lot on their plate, and simply forgot to make  the payment. To resolve this, all you need is a reminder email to ensure they set aside time in their day to process the payment. With overwhelmed patients, make sure that you use gentle reminders unless it’s been over a week, in which case, a phone call may be required.
3. They have a problem - Patients may not have paid for their required services as they don’t agree with some of the information shown. As a result, you need to talk and communicate with the patient to resolve any disputes. 
4. Dishonesty - It’s possible that the patient may not have had any intention of paying for your services. This is particularly tricky, and in this case, you  may need to call for external professional help, as legal proceedings are likely to be involved. 
5. Disorganization - Some patients are simply disorganized, and have lost their invoices and bills amongst other information. This is natural, as amid life, it’s easy to put things aside for another day. In this case, simply email or call for a reminder of their payment.
6. Ignorance - Sometimes patients may think there is no rush for sending in payment information, as it doesn’t affect your end as much, so long as the payment is made within the year. They may be unconcerned, in which case, you need to remind them of their obligation to pay on time. 

To conclude

While numerous factors go into healthcare payments, we hope that this guide has covered all the essentials that you must recognize before launching your own payment systems within your professional practices. We acknowledge that it can be difficult to know everything when it comes to finances and processing payments, and the good thing is, you don’t need to be an expert! For your business to run successfully, it’s important that you at least have the foundational knowledge of what it takes to process payments promptly and efficiently, as well as how to remain HIPAA compliant, and ensure thorough collections procedures. Although every healthcare practice conducts healthcare payments a little differently, hopefully through this information, you have a more consolidated understanding of what may be beneficial to achieve the goals of your practice.

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