Challenges Explored
Capturing accurate prepayments for anesthesia can be problematic given the unique calculation of anesthesia charges. While it is relatively easy to identify the base unit value for the procedure, the anesthesia time can be unpredictable. When fee schedules are established for cosmetic cases, they are typically based on time estimates. This could also be true of procedures such as IVF.
The critical requirement for such arrangements is a mechanism for capturing the funds. An arrangement must be established with the respective office staff to get a check or a credit card authorization based on a proposed fee. Obviously, such agreements must be trackable and auditable. This is why most anesthesia practices receive a relatively small percentage of their revenue from prepayments.
Then there are the policy hurdles presented by certain payers. Generally, you cannot collect prepayments from Medicare/Medicaid patients. In addition, many network contracts between commercial insurers and medical groups will prohibit group members from requiring certain payments before the medical service is rendered. They can ask for it, and patients have the option to pay upfront; but the patient’s health plan likely prohibits the denial of care based on the patient’s reluctance to make payment ahead of the medical service or procedure.
Possibilities Considered
For those patients who have a commercial insurance plan that (a) does not prohibit the requirement of prepayment of the copay or deductible, or (b) does prohibit the requirement of prepayment but where the patient willingly agrees to prepay nonetheless, there are some possible strategies to consider. Some time ago, we calculated the average co-payment for a particular group practice based on its commercial, i.e., non-Medicare, population and determined the average the patient would owe. We discussed the practicality of expecting a payment from these patients when they checked in for the procedure; it was agreed that expecting the calculated prepayment made sense. An arrangement was made with the admitting staff to collect these funds.
Obviously, such arrangements assume the practice has a good relationship with the facility. As a general rule, this is probably more likely with ambulatory facilities where the volume and scope of services is more limited and where a key employee has agreed to assume responsibility for the process.
The advantage of collecting payment up front is clear. Many patients struggle to find the necessary funds after the insurance has paid. The reality is that even a relatively simple surgical procedure can result in significant financial responsibility, especially when deductibles have not been met.
A drawback to collecting prepayments based on estimates is that this would create refunds back to patients in some cases once their insurance has fully processed their claim.