Improve Patient Collections with a 'Credit Card on File' Program

Abraham Whaley
Manage My Practice

Credit Card on File systems are the road to financial viability. This program changes your patient collections from a back-end collection program to a front-end collection program, effectively collecting 95% of the patient responsibility within 45 days of the service.

In a credit card on file (we abbreviate it “CCOF”) program, the patient’s credit card information is securely stored off-site so that co-pays, co-insurance, deductibles, non-covered services, and balances after insurance has paid can be charged to the card automatically. In addition, payment plans can be arranged using the CCOF program, allowing patient payments to be automatically drafted on a schedule agreed to by patient and practice.

Step 1: New Patient calls for an appointment

Using Standard Back End Collections…

The patient calls for an appointment and the staff confirms that the office is contracted with their insurance, and finds an open provider time slot for the appointment. The patient is advised to bring their insurance cards and that the co-pay will be collected at the time of check-in.

Using Credit Card on File…

The patient is advised to bring their insurance cards and that the practice requires a credit card be kept on file for guarantee of payment for co-pays, co-insurance, deductibles  and any balances after insurance pays.

Step 2: The day of the appointment

Using Standard Back End Collections…

On the day of the appointment, the patient arrives 15 minutes early to fill out their demographics and health history forms – if they haven’t done so already online – and gives their insurance information to the front desk. Most practices collect co-pays prior to the visit. At checkout, the office may collect co-insurance or deductibles, but many will wait to bill the patient until after the insurance pays – even though the patient will never be more motivated to pay than they are at the moment they received the service.

Using Credit Card on File…

The patient also presents a credit or debit card, which will be kept securely in an online gateway after the employee swipes the card in the reader. The patient signs an agreement stating that they agree for their portion of the charged to be applied to their card and to accept refunds the same way. The agreement also states that no amount above $x will be charged to their credit card without being notified before the card is charged, and that if the card becomes invalid a new one will be provided. If information about coinsurance or deductible responsibility is available, the staff will charge the patient’s card for the responsibility and email the receipt to the patient. If the patient is uninsured, is receiving a non-covered treatment, or is anticipating a large responsibility for treatment due to a high-deductible health plan, they can arrange an electronic payment plan that can be drafted to the card at regular intervals.

Step 3: After the claim adjudication

Using Standard Back End Collections…

Any uncollected patient responsibility, including any co-pays, coinsurance or deductible, is added to any previous balance which is sent out on a statement after the patient’s insurance pays. Many practices send three statements before turning the patient over to a third-party collection agency, at which time the account is usually 120+ days old.

Using Credit Card on File…

The patient’s financial responsibility was planned for at the time of service. Any additional responsibility less than the pre-set limit (usually $50-$100) or any amount to be refunded to the patient is automatically processed using the credit card on file. If there is a responsibility greater than the pre-set limit, the patient is notified and the card is either charged for the full amount or a payment plan is arranged.

The bottom line is that the Credit Card on File System is easier on you, your patients, your staff, and your bottom line. Click here to register for the next Manage My Practice Credit Card on File Webinar today!

About the Author

Blogger, consultant and co-founder of Manage My Practice, Abraham Whaley has experienced the complexities and solutions of the healthcare industry in many different capacities and brings a wide array of experience in quality assurance, chart auditing, billing, medical records and customer service.

A keen observer of trends in business, technology and politics, Abraham is passionate about helping organizations meet the challenges of a rapidly changing landscape and thrive together with their patients, employees and communities. Managing the web and social media presence of Manage My Practice, Abraham strives to promote the values that we place first: delivering value, sharing information, and transparency.