Increase In-House Nursing Homes Collections

The following nursing home collections report outlines 11 guidelines you can follow to increase the amount of in-house long term care collections your facility collects.

1] Have A Defined Long Term Care Collection Policy

One of the major causes of delinquent nursing home receivables is that the facility has not clearly defined to its residents/responsible parties and business office staff when the accounts are to be paid. If you are currently 'playing-it-by-ear', and have no consistent guidelines for your business office to follow - you are inviting bad debt. These guidelines should be made clear to both your business office and admissions staff. If you consistently apply your collection policy to every nursing home account, you will enjoy a large decrease in delinquent accounts.

2] Educate Residents/Responsible Parties On Your Policy Before Admission

If residents/responsible parties are not educated that their nursing home accounts need to be paid on time - then chances are they'll pay late or sometimes not at all. Make it crystal clear what day of the month that you bill, and when their payment is expected. Let them know the consequences of non-payment up front - not after they become delinquent. This eliminates potential future misunderstandings from your residents/responsible parties. Statement of your payment policy when payment is overdue is a strong first step in facilitating payment.

3] Invoice Promptly and Bill Regularly

If you don't have a systematic invoicing and billing system - get one. Many times the resident/ responsible party hasn't been re-billed or reminded to pay in a timely manner. This situation regularly occurs in homes where there isn't enough billing staff in your business office, or the staff is spread to thin to invoice or bill on a timely basis. It is amazing how much money is often left uncollected because the resident/ responsible party was never billed or contacted a second time.

4] Keep Accurate And Timely Payment Records

Once a resident is admitted, it is vitally important to maintain accurate and timely records on their payment history. If you see any deviation from past payment patterns, and especially if payments become unusually slow, immediate follow-up is warranted. This not only gives you an early alert to impending payment problems, it also gives you the chance for early intervention if there is an outside influence (i.e. responsible party withholding payment, etc?)

5] Contact Past Due Accounts More Frequently

There is no law prohibiting you from contacting a resident/responsible party more than a month. The old adage 'The squeaky wheel gets the oil' has a great deal of merit when it comes to collecting delinquent accounts. It is an excellent idea to contact late payers every 14 days. Doing so will enable you to diplomatically remind the resident/responsible party about your terms of payment and give you more chances to discover the real reason why they are late.

6] Develop A Systematic Plan To Follow Up On Past Due Accounts

Determine ahead of time what actions you will take and a defined time frame when the actions will take place. For example, at 15 days delinquent - make a phone call. Your business office can start with a 'courtesy' call to make sure the statement was received. At 30 days delinquent - send another statement with a message, "This balance is 30 days delinquent, please remit immediately." At 45 days your business office can call and make a stronger demand for payment. Having a plan and adhering to it makes both you and your residents/ responsible parties aware of the fact you expect to be paid on a timely basis.

7] Use Your Aging Report - Not Your "Feelings"

Many well meaning business offices have let an nursing home account age beyond the point of ever being collected because they 'felt' that the resident/responsible party would eventually pay. While there certainly are a few isolated cases of unusual payment situations, the truth is that if you aren't being paid, usually someone else is. So stick to your systematic plan of follow up. You'll soon know who intends to really pay and who does not. You can then take appropriate measures once you know where you stand.

8] Make Sure Your Business Office Is Trained

Even experienced business office members can sometimes become jaded when dealing with debtors. This usually occurs when the residents or responsible parties: have made and broken promises for payment, did not file information at the county office, avoided your attempts to make contact, moved with no forwarding address, or just flat out declared they have no intention of paying. Make sure your business office is firm yet courteous when dealing with the residents/responsible parties. Your business office could benefit from customer service training because they must 'sell' the residents/responsible parties on the idea that you expect to be paid. Make sure your business office is trained to not only bring the nursing home account current, but to also maintain good will with your residents/responsible parties.

9] Admit And Correct Any Mistakes On Your Part

Sometimes residents/responsible parties do not pay because they feel you have made a mistake. If the basis of the non-payment is a dispute over the quality of care, a mutually agreeable settlement between you and the resident/responsible party should be arrived at promptly. The resident/responsible party may use a minor dispute to withhold substantial payment. Insist that the undisputed portion get paid immediately, indicating the balance will be negotiated. This will not only help to collect payment payment, it shows the resident/responsible party that you are listening to his or her concerns.

10] Use Third Party Nursing Home Collections Intervention Sooner

If you have systematically pursued your delinquent nursing home accounts for 60 to 90 days from the due date, and they still have not paid, you are being delivered a message from your resident/responsible party. If you have implemented a good collections policy, you have requested payment four to six times in the form of statements, letters, phone calls and possibly personal visits. Statistics show that after 90 days, the effect of in-house collection efforts wear of 80%". That means that the time and resources of your business office should be focused within the first 90 days of delinquency where you have the best chance to collect the delinquent nursing home balances. From that point on, a third party can motivate a resident/responsible party to pay in ways you cannot, because of both the perceived and real consequences of dealing with a collection agency or attorney.

11] Remember That Nobody Collects Every Account

Even by setting up and adhering to a specific long term care collection plan, there are always some accounts that will never bee collected. By identifying these nursing home accounts early your billing staff a great deal of time and money. Even though a few may slip by, you will find that the overall number of slow pay and nonpaying accounts will greatly diminish, and that's a victory in itself!

Collection Agency Services offers you a wealth of information on how to select the best collection agency for your business.

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