How to get paid by self-pay patients
Self-pay special report.
The self-pay patient is an increasing component of any successful private practice. Simon Brignall discusses the range of payment pathways you will need to help you reap the benefit.
Growth in demand from self-pay patients has been a well-defined trend in private practice over the past decade.
At Medical Billing & Collection (MBC), we partner with over 1,700 consultants, groups, clinics and hospitals across all specialties and our data shows that self-pay was increasing year on year as a percentage of the invoices we raised before the pandemic.
The impact of Covid and the subsequent recovery has only turbocharged this trend. With NHS waiting lists already at a record 6.8m and rising, this will bolster the demand for private healthcare from patients who are not prepared to wait.
Data from the Private Healthcare Information Network (PHIN) for Q1 2022 continues to show a surge in self-pay patients as activity is higher than was seen in 2019 – as reported by Independent Practitioner Today last month.
While London remained the most active self-pay market with 13,800 admissions, the regions saw growth of between 20-114%.
There have been many reasons for the increase in the demand for self-pay over recent years, but I will attempt to outline the key drivers.
NHS
With approximately 10% of the population having private health insurance already, some of the remaining 90% of the population impacted by NHS delays have elected to go private.
And with headlines in the press suggesting rising NHS waiting lists, this demand for private healthcare will only continue to increase.
Many self-pay patients who previously were presenting as consultations and second opinions are now converting to treatment.
Wealthy elderly patients
Wealthier elderly patients, many who have benefited from rising house prices, are in a better position to access private healthcare than ever before.
Many now see private healthcare as an option that is for them and, alongside their greater quality-of-life expectations, this means that they are more likely to go private than previous generations.
Increased patient expectations
We have come a long way in the past few decades. Patients no longer feel that healthcare is something that is done to them. Many patients wish to have more choice with regards to their clinical pathway.
This is often where the private sector can excel offering a wide range of clinicians, facilities and treatments.
We may debate the terms that are used from ‘patient’ to ‘consumer’ but the demand for increased choice and higher expectations are here to stay.
International patients
If your practice is based in central London, then international self-pay patients have been a key component, with patients coming from outside of the UK seeking private healthcare.
This area was immediately impacted by travel restrictions imposed at the start of the pandemic, but we have seen increased demand from these patients since 2021.
Best practice
We have shown the value of the self-pay sector and so it is important to make sure these patients are managed effectively both from a billing and collection perspective. However, from our experience, this is often not the case.
Practices rarely offer appropriate payment options to allow for
simple invoicing and payment collection and the chasing of outstanding debts can be sporadic. This results in practices building a large amount of outstanding debt leading to cash flow difficulties or loss of income.
The reasons for this debt problem is that practices fail to implement robust procedures to effectively manage these patients.
Ask yourself these questions:
Do you know the percentage of your practice that is self-pay?
What type of self-pay patients are they?
Once you have this data, it is vital that your practice has systems in place to deal with each self-pay type.
I will elaborate further on the main types we see at MBC.
UK self-pay
For self-pay patients, it is important that you have a published price list or to have notified the patient of their fee in advance.
It is best practice to also confirm the payment options that are available and when payment is due.
At MBC, we have a variety of methods available to offer our clients tailored to the needs of their practice:
Most commonly, we invoice patients after their treatment, offering a range of payment options which includes a link to our payment portal for 24/7 payment collection or via our payments team;
We also offer the option to invoice patients in advance for treatment, where required;
Monies can also be collected on the day via our client self-pay platform.
Remember, when you are invoicing patients post-treatment, you will need to put in place a robust chase process for any outstanding invoices and ensure this is repeated regularly until payment is collected.
Failure to implement effectively is the most common reason why debt levels increase and can lead to cash flow difficulties.
Overseas patients
If you are going to see a patient who is not a resident of the UK, it is even more important to make sure that your fees, method of payment and payment date are made clear, as once they leave the country it is extremely difficult to collect any money owed.
When we deal with international self-pay patients on behalf of our clients, we routinely collect payment in advance of treatment.
Collection by the hospital or clinic
Many hospitals and clinics collect money on behalf of their clinicians as part of a fixed price package for a procedure where the consultants, anaesthetist and facility fees are combined to show one price to the patient or simply for a consultation.
It is very important not to overlook this area of self-pay, so make sure that these patients are recorded, reconciled and chased.
Hospital administration can vary dramatically between facilities or get impacted by changes to staff. It is very common for payments to be delayed or, worse, missed entirely.
We raise an invoice to the hospital for consultants’ fees, reconcile the payments and chase the relevant finance department when required.
Regular patients
Some practices, due to the nature of their specialty, either regularly treat or form a long-term relationship with the patient and patient’s family.
Mental health practitioners can see patients regularly over a period and a private GP practice may look after an extended family for decades. The fact that these patients will require repeated invoicing makes it even more important that the process is as simple as possible
We provide the ability to settle multiple invoices at the same time as well as provide our clinicians with a payment link that they can add to their website.
Insurance shortfalls
To help control the cost of premiums many private medical insurance companies have amended their policies to include ever-increasing elements which are either not covered, have thresholds or require co-payments or excesses.
These patient liabilities still fall on the practice to administer, which means they must have a process in place an ensure that it is routinely followed.
This is always the area that even the most efficient practices find challenging and often makes up most of their aged debt.
As most patients do not review the terms of their insurance policy, they assume that all costs are going to be met by their insurer; so when they receive an invoice for an outstanding balance not covered by their insurance company, this can come as a shock.
From our experience, a lot of patients will ignore the invoice, thinking that it is either a copy of what has been sent to the insurer or that their insurance company is liable. Which means it is important to follow up with the patient directly and explain what it owed.
Some patients will wish to contest this with their insurer because they may believe that the company is liable – which is why it is important to highlight any issues as soon as possible to minimise delays.
Once the patient accepts that the money is owed by them, then steps need to be put in place to chase outstanding balances and take payment.
Moving forward
Self-pay has been the growth sector in private healthcare in recent ears and, combined with the fact that you get to determine your own fees, it is of increasing value too.
It is important that you review how you manage these patients to ensure you offer them the range of functionality they require.
Consultants often find the best solution is to partner with a billing company that offers both the expertise and full range of functionality you need.
Simon Brignall (right) is director of business development at MBC