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Patient Payments Blog

Guarantee Patient Payments Every Time?

Posted by Jim Turner

Nov 29, 2016 8:07:00 AM





The MGMA statistics for patient revenue are staggering. The MGMA estimates between 25 and 35% of overall revenue comes directly from the patient’s pocket. Left uncollected or allowed to age, this lost or late revenue can seriously damage or completely destroy a practice. Paying attention to patient payments has become a necessity in the modern medical practice.

Take a moment to consider this question,

If you could guarantee payment of patient invoices every time how much better off would your practice be?

If you are like me, questions like this one always bring out the skeptic in me. Without baiting you into an article that won’t do you any good and without overstating the results, I’d like to introduce you to method that is as close to a guarantee of payment as can be achieved.

Imagine if every patient who received treatment from your practice was required to leave an envelope full of money enough to cover any potential costs they would incur. Then imagine that any patients would actually show up with that envelope of money (perhaps if you had an absolute cure for a deadly disease they might)! If that were the case then all your patient payment challenges would be over.

Absent envelopes full of money, how can your practice get as close to a guarantee of payment as possible? The simple answer is, with card-on-file. Card-on-file is the act of capturing credit or debit card information in a secure system with the patient’s consent to use the card to cover his or her bill. It’s like a hotel. When you check in, the hotel captures your payment card for room and incidental charges. They don’t actually charge anything on the card until you check out. Then they collect whatever you owe. The hotel gets paid with very few exceptions.

Your practice can take advantage of this same system. The three basic steps below are an outline of how to get started.


  1. Inform your patients they will be required to have a form of payment on file with your office. You may already have a sign in your office that reads something like, “Payment is required at time of service” but have never had a good way to enforce it. Give plenty of notice via your website, intake paperwork, monthly billing, office signage, etc.
  2. Capture a credit or debit card for every patient that comes to your office. You’ll need a payment processing system that securely retains payment card information. Do not hand write or keep credit card information on a spreadsheet. Invest in the right system for your office.
  3. Recall the payment card information and run the transaction when you know exactly what the patient owes. This can be a co-pay amount, or a retail item, or when the EOB arrives.  Anytime you know the patient is responsible is the time to use the payment information.


There you go, the quickstart guide to getting paid by patients. There are patient-practice dynamics that come into play when implementing these steps but the basic steps don’t change. You may need help marketing the new system or explaining it to patients in the office. You may need to find a system that allows you to securely hold payment card information on file. You will need to answer questions like, ‘What if the patient won’t leave his card information?’ or ‘What does this cost?’ or ‘What if a patient can’t pay the balance in one payment (there are solutions for that!)?’ or ‘Won’t this make patients mad?’ and many other considerations. Don’t let those deter you. Take them one by one and create a plan that will work for your office.

In many ways a card-on-file is better than an envelope full of money. You can charge the exact amount. You don’t have to do refunds or try to collect more from the patient. The patient doesn’t get charged until the exact amount of responsibility is known. You control when you get paid instead of waiting on a check in the mail. There’s no risk of under or over charging the patient.

It’s not an absolute guarantee but card-on-file is the best chance of getting paid and eliminating multiple billings, collection efforts, write offs, and check processing. Try it with a sub-set of your patients and track the results. You’ll find that getting paid is not as hard as it used to be!

Topics: Patient Balances, Patient Payments, Patient Collections Culture, Medical Office Administration, Medical Billing, Lost Revenue

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