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When client invoices go unpaid

A proactive approach that starts before a pet arrives can help veterinary practices reduce collection-related issues.

When client invoices go unpaid

For many veterinarians, creating and maintaining a healthy revenue cycle can be a major challenge. Balancing day-to-day operations, providing excellent care, and managing billing and payments can be a constant struggle. But it doesn’t have to be. Capturing more revenue and setting your office up to handle the collection process all depends on the systems and processes you put into place in the first 30 days of your billing cycle.

Here are the steps you can take to do just that:

1. Streamline Data Collection

First, look at your intake procedures. Beyond basic care-related information, be sure that you’re capturing client details that will aid in billing and revenue collection later. Your intake paperwork probably collects basic details like contact information, liability waivers and other practice-specific forms, but it also should cover collection-minded regulatory disclosures. This includes releases regarding the Telephone Collection Procedures Act (TCPA) and other compliance-focused paperwork, which are critical for you to be able to pursue collection in case of delayed payment or non-payment.

Especially as your practice works around COVID-19 safety requirements, ask pet owners to complete as much documentation as possible, including collection-focused paperwork, before their visit. This will make intake easier and set your collection process up for success, should it be required. While you might feel comfortable preparing the documentation on your own, a reputable debt-collection partner can help you prepare the documents so that you can be sure your practice is following all laws and regulations.

2. Initially Ask for Full Payment or a Down Payment

Requiring upfront payment rapidly expedites your revenue cycle and eliminates additional administrative costs in tracking down balances. Though obviously optimal, full payment may not always be possible for your clients, in which case you might choose to offer a down-payment model. In this instance, you can either request a proportion of the total cost as a standard — for example, 50% — or set a nominal figure that your practice requires. However, if your practice chooses to employ a partial-payment procedure, set expectations about when the remaining balance is due and how your clients can make payment to you.

Setting up modern payment opportunities like mobile or online portals works to your advantage in the case of requesting upfront payment. Easier and more accessible payment options show your clients that you care, but also can help eliminate barriers to payment that make the process frustrating or inconvenient. The more accessible your payment options, the more likely your clients are to use them.

3. Discuss Payment Options

Requiring payment upfront sets the stage to educate clients about financing options offered through your practice or by third parties. While not all clients will qualify for financial assistance, many will. Working with a financing partner will eliminate staff stress and encourage clients to get needed care for their pets.

Being proactive with financing information increases your chances of collecting payment. It also sets a precedent for clients so that they know that they have financing options. As with most high-cost expenditures, providing clear, simple information can go a long way in helping to ease concern, so vetting your potential financing partners is important. If your practice offers a financing program, be sure that your collateral and processes meet the same standards.

4. Hone Your Billing Process

If your practice prefers not to take payment at the time of care, you should be swift and diligent in billing clients afterward. Send the bill as soon as possible, and set a regular cadence for communication, either through letters, e-statements or phone calls until the bill is paid. Here is an example:

Day 0: Set clear payment expectations.

Let clients know their payment responsibilities prior to the appointment, if possible. Alert them to financing options that might mitigate hesitation, and send intake information to be completed before the pet’s visit.

Day 1: Begin the billing process.

Inform the client of the bill as soon as the total is finalized, either with a hard copy at the time of care, electronically or both. At this point, your staff can reiterate financing options and provide printed information on the topic, if available. This is an opportunity for your team to educate the client on the payment methods you offer and when payment is due. This face-to-face interaction, even if distanced during the time of COVID-19, is an excellent opportunity to answer questions your client might have about their financial responsibilities.

Day 15: Check in on outstanding balances.

If you haven’t received payment within 15 days of care, send a follow-up. Whether you choose to do this electronically or through a letter, you can pair the bill with other relevant content, like a post-care survey or even specific notes about the client’s pet.

Day 30: Begin the collection process.

After 30 days of no payment, your staff should begin collection calls. To maximize success, design a standard script for the staff to utilize. The scripts should be simple, direct and compassionate without being confrontational or overly emotional. Role-playing with the staff is an excellent way to increase comfort with the process so that employees feel prepared when discussing unpaid bills. Set a standard cadence for pet owner outreach and formalize communication records through reporting so that you can track patterns and success.

5. Consider Collection Assistance

You might consider engaging a first-party or third-party collection partner to support your practice in the first 30 days of your revenue cycle, depending on your practice’s size, needs and preferences. At this stage, a reputable partner can offer first-party collection services, meaning it works under your name to recover revenue before accounts go into default. An option that might be more appropriate for your practice is a third-party approach, meaning the matter would be handled on your behalf under the collection company’s name. The sooner you connect with clients regarding payment, the better your chances of recovery.

A collection partner can support your staff members, who might not have the bandwidth to be as vigilant in pursuing accounts at the early stage of the billing cycle or the training to do so effectively. Finding the right combination of outside support for your revenue cycle means more income for your practice and more time for you and your staff to do what you do best: Provide premium veterinary care.

Whether you’re new to veterinary practice ownership or you’ve spent your career building a clinic, establishing a robust, transparent and sustainable revenue cycle is key to the profitability and longevity of your practice. It’s the systems and operations you put in place to support the first 30 days of the cycle than can set you up for financial success in the short and long runs.

By following these steps, you can deliver a simple and straightforward payment experience, which, when paired with your utmost quality care, creates trusting and loyal clients for years to come.

Jacob Corlyon is co-founder and CEO of Capital Collection Management. To learn more, visit www.capitalcollect.com.

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