Prerequisites
- Your internal collection process exhausted: statements, contact, payment plan offered
- A financial policy the patient signed
- A hardship or charity care assessment, if you offer one
- Counsel review of the agency agreement
Think about it first
Collect healthcare debt with the patient relationship in mind. Dental balances often arise from benefit rules the patient did not understand, such as a downgrade, frequency limit, or exhausted annual maximum. A collections placement may also affect hygiene recall, online reviews, community standing, and family referrals. Weigh those effects against the expected recovery. The rules for medical debt credit reporting, including dental debt, have been changing at both the federal and state levels. Verify the current rules before relying on credit reporting as leverage. Before sending an account, ask:- Is the balance large enough to justify the recovery and the cost?
- Was the patient offered a payment plan, and did they decline?
- Was hardship assessed?
- Is the balance correct, or has the patient identified a billing issue such as an unexplained downgrade or a claim the plan should have paid?
- Would we be comfortable if this appeared in a local news story?
Selecting an agency
Ask for references from healthcare clients and, if you can, listen to a recorded call.
HIPAA and what you send
Collection is a payment activity under HIPAA, so disclosure to an agency is permitted, subject to a BAA and to minimum necessary.
Send the minimum necessary to collect the debt. An agency does not need to know why the patient was seen. “Balance for dental services on these dates” collects exactly as well as a procedure-by-procedure narrative; sending diagnostic or clinical detail is an over-disclosure, and it is the kind that surfaces in complaints.
Steps
1
Define the placement policy in writing
Minimum balance, minimum age, required prior contact attempts, hardship screening, and exclusions, for example, accounts in active dispute or with a pending appeal.
2
Execute a BAA before sending any data
3
Scrub the placement file before it goes
Remove accounts with a pending insurance appeal, active payment plan, in-progress orthodontic contract, active membership-plan autopay, credit balance, open card dispute, documented dispute, or pending hardship application. Also review how the balance arose. Speak with the patient before placing a downgrade or exhausted-maximum balance that was not included in the treatment estimate.Cross-check against open chargebacks and credit balances. Sending an account to collections while you owe the patient a refund, or while they have an open card dispute, is the fact pattern that produces complaints and regulatory attention.
4
Send the minimum necessary data set
5
Handle recalls promptly
If a patient disputes the balance, insurance reprocesses, or the balance turns out to be wrong, recall the account immediately. Keep the recall process fast and unambiguous, because slow recalls are what turn errors into complaints.
6
Monitor complaints and outcomes
Track recovery rate, complaint rate, and recall rate. A high complaint rate is a signal about the agency or about your placement policy.
7
Review the agency annually
Including a sample of their communications with your patients.
Alternatives worth exhausting first
DSO notes
Collections management is a DSO function; the debt belongs to the PC and recovered funds are the PC’s revenue, landing in the PC’s account. The PC should approve the collection policy, because it affects the patient relationship and, at the margin, access to care, even though the dental support organization (DSO) executes it. See What a DSO can and can’t do.Verify it worked
- Written placement policy with minimum balance, age, and prior contact requirements
- BAA executed before any data was sent
- Placement file scrubbed for appeals, payment plans, ortho contracts, credit balances, and disputes
- Minimum necessary data only
- Recall process fast and documented
- Complaint and recall rates tracked
- Agency reviewed annually, including sample communications
- Current medical-debt credit reporting rules verified
- PC approved the policy