Cash, Checks or Credit – Debit Cards

When you open your practice, you have to decide how you want to accept payment. Seems simple enough doesn’t it. You want people to pay you! It’s essential to have a cash flow in order to keep your office open. But that is where the simplicity ends.

Cash…okay that’s easy. But think about this…will you have enough cash on hand to make change? How will you handle the potentially large sums of cash? Who will manage it and track it for you?

Checks. For the most part it can be straight forward. Some people insist you take their checks and are downright insulted when you don’t. Okay…but what is your policy for checks that are returned? And what does the bank charge you as the merchant? How will your recover any bounced check charges?

Credit Cards|Debit Cards. Not simple and potentially very expensive. Usually when you are looking to take these, you will need a swiper (over $600 at Costco when I checked last year), plus you will have monthly fees for the gateway account, swiper software, fees that are a % of collected fees based on cards, and so forth. There are also fees based on the amount of business that you will do.

Here is what I did .I got a PayPal virtual terminal account . We pay a flat monthly fee, plus a transaction fee. We enter the information right on line (we had DSL, and there fore are constantly on). The patient gets a copy right there of the transaction, and the money is in our account in real time. No spends swipers.

Since the majority of people pay us with cash and checks, it made no sense to spend a lot of money on credit cards when our intake could not justify the cost.

So assess your situation and then make a choice. Remember to…you can always change your choice as your business grows.

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  1. I have posted my own question about this on the list serve. I have heard some positive comments about PayPal. I will speak to a live representative, because I have trouble with their site, taking all the account information. I want to ensure privacy, and efficiency when I am conducting transactions, and certainly keeping costs down. Thank you. Calr

  2. I have a question for any NPs on this site. I am currently opening my practice in the next week prior to being credentialed with the insurance companies. I have filled out the majority of the state credentialing applications for at least 15 insurance companies, and medicaid, but have still not tackled Medicare. (It will take about 2-3 mos to get credentialed). I plan once I offer to take insurance to continue to see patients that are uninsured with probably a 30% discount of billing for codes with usual and customer charges. For example, (I have not set my prices yet) but say my 99213 charge is 90.00. Then my cash price would be 30% less than 90.00 = 63.00. Is this appropriate to set a price menu and also a cash discount menu as well, so when a patient comes in with no insurance, and they get a 99213, plus a rapid strep, (cost for this is 10.00), so total visit is 100.00 . The patient would then pay the billing rate -30% discount, which is 100.00 -30% =70.00? Is it appropriate and expected to offer the exact cash discount at this time, even when I am not billing insurance yet? Thank you for anyones help. Carla/Oregon

  3. Carla,

    There is no set way to set fees or discounts for cash paying patients. The only thing I “think” that is set in stone is that you cannot charged less than your Medicare allowable rate. For NP’s that 85% of the physician rate.

    One article I read recommended that providers set their fees at 2-2.5% the Medicare allowable, and then discount by 30% for cash pay.

    I’ve heard over the years that you also do not want to bill less than the insurance rates, as insurance companies will drop our rates as well.

    Again…the only thing I’m really aware of that is close to the truth is do not charge less than Medicare.

    One billing person showed me a formula she designed to set rates. I’ll ask her if I can her documentation…that may help several of us.

    Barbara C. Phillips, NP

  4. Carla, I think I am reading your query correctly. The basic idea is that you have one fee schedule to avoid problems with Medicare. It is acceptable to offer a prompt pay discount to your self-pay patients. Apply it consistently and I believe that you’ll have no problem.

    What you can’t do is tell a patient “I have a separate fee schedule for you”.

    When you become a participating provider for insurances, you agree to their fee schedules. When you see your payments come from them, they will knock off a portion for contractual allowance. You have sent them the bill for your 99213 visit for $90 according to your fee schedule but have agreed to take less in order to participate on their plan.

  5. Hi all,
    Re: all of this discussion on billing and payments, I have had difficulty with pricing as well. I am in a group practice, psychiatry, in SC. I have all sorts of billing issues, much of which keep cash from flowing properly. Please help me out if you can!!

    One issue re: fees–one of my billing people (I had been working with another smaller group and then had a different billing person—one that seemed to really know her game) told me that we can negotiate fees with insurance companies, which I had no idea about. We don’t have to just roll over and play dead and be at the mercy of whatever they will pay, according to her. I ended up billing a far larger fee to the companies at that particular practice. We were trying to arrive at my prices, and the doc I worked with had a far higher price than I had thought I would charge. So we ended up trying to bill the same as the doc–in my field, rates are really high. And they paid. I don’t think there was any negotiating, they just paid. I thought it interesting, as at my primary location my billing rates are about half that! I kept wondering if I would get a call from an insurance company questioning this, but have not so far.

    Also, at my primary site, the other NP charges about the same lower rate as I am. I thought that this was how I was supposed to do it–that a company might question what was up if one NP charged a far different sum than another. In psych, and in my particular practice, we are all independent contractors, so we can charge different prices. Does anyone know anymore about this????

    Then, re: cash flow, I need help on another topic. We have 2 office admin people. One comes in and picks up our mystery paperwork and whisks it away to submit to the insurance co’s. Then it seems to get stuck there. Some pay, others the cash gets hung up for one reason or another. She does not go after that money that doesn’t flow back to me. I have asked her please, this is why I pay you, please find out what the problem is, as I don’t have time to spend on the phone going after it. And it is really a time-consuming task as you all might know. Then our in-office admin person does her job, which is to verify insurance and to handle the … what are they called … the requests for more visits…I can’t remember what that is called at the moment. And other specialties may not have that anyway. She does NOT go after money. You’d think the billing person would go after that cash as she is making a percent off of collections! I had a great billing person once in the past and she brought that money in, boy! ANY suggestions, please forward on.

    THanks. –Julia

  6. Hi Julia,

    I hope you find your way back to this, this web blog is getting long! I had to laugh at your “mystery paperwork”.. I am very new at this too, and I have felt the exact same way! I said the very same things about the biller, she is making a percentage of what is brought in, so why is she not more aggressive.. well, I do not know about your biller. Does she have larger accounts than yours? She may not be very financially hungry, and kind of like a realtor, if it is only 50.00 or 100.00 more money, she might not make the effort..but I completely agree with you! I said the same thing, I am paying this person to do the things I cannot, and do not have time for! Also, it creates a conflict of interest for the provider to be calling the patient about the bills.. I have had to do that, as my biller just did not take the initiative, and I acted so nice, because frankly I was embarrassed to call, and I dont think patients expect the provider to call… However, it does put it right in their face, I mean how would they like it if they dont get paid? It is almost like patients think the provider is a gold mine, and there is a big wall of people in front of us, but we are just people trying to make a living like everyone else..

    But is this person that picks up your superbills a biller? Or is she just taking the superbills to an outside biller? Do they go to a clearing house? What kind of software is used? Is it Medisoft, or Office Ally? Find out, and see if you can view it or read your practice analysis of what has been billed out, and what is pending, etc, from your own office computer. Also, if that is not possible or in addition to that, have your biller send you an “aging” report that will show what has been billed out by patient, dos, and insurance, and what is outstanding.. and for what time period..

    One thing that is very good, is that you have an in office person verifying the insurance. That is very important. I am so small, I am just now training someone to do that, as if there are deductibles, or problems with the insurance, there is nothing more disappointing then waiting at your mailbox for a month, and then seeing that insurance envelope with a “paid zero” comment! I also agree with you, that the biller should be aggressively going after what is owed BEFORE YOU EVEN KNOW ABOUT IT. SHE SHOULD BE INFORMING YOU AND BE ON TOP OF HER GAME. You should not have to get a taser and prod like a slow cow…

    Regarding your insurance rates, this was new to me also. Barbara just posted for January a wonderful article from Medical Economics, on negotiating with the insurance payors. It does not matter whether you are a doc or an NP. If you are credentialed and have a contract, as a pcp, or part of a group, you still can negotiate for your fees. There are two components. One is the actual dollar amount that the insurance company will pay “per RVU”. The second part is the dollar value of the RVU. Now the RVU dollar amounts are supposed to be standard nationally, but some payors still use data that is two years old, and if you do not show them the current data, they may under pay you. For example, I believe the current RVU for a 99214 right now is about 2.67, and the RVU for a 99213 is about 1.71. So if your insurance company says they will pay you 61 dollars per RVU, then you multiply and a 99214 would give you about 162 dollars. So then you want to set your rates at slightly higher than what most of your insurance companies will pay. If you set them too low, you will lose out on potential payment. Also, get about 5 superbills from other providers, and look at what they are billing. Take all that information, and come up with your prices.. Expect Medicaid to pay about 40% less.. for example in Oregon, they pay about 34 dollars per RVU, and my other insurance companies pay about 60-63 dollars per RVU.. Medicare of course is the standard upon which many companies base what they pay, a percentage over Medicare.. and Medicare has the rates posted on their website, and for a NP you deduct 20% off of the fee schedule. So if they normally pay 92.00 for a 99214 for a visit seen by a physician, they will pay an NP 80% of 92.00. That is just the way it is. That is why when many NPs work in doctors offices, even if they are credentialed some docs break the “incident to” rules, and bill under their name, because they want that extra a20% to go into their office which is fraud..

    Hope this helps. One thing I may suggest, and I may do this as well, to solve a biller that is not being agressive (may be covering up a lack of knowledge or just plain not fierce) is to get a practice management consultant to come in, and in front of everyone, tell us all including the biller what needs to be done for a good practice. Then the biller has to be accountable to a standard, and there are witnesses, and as it comes from an outside party less offense might be taken.
    Regards, Carla Anderson, FNP

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