Each time the subject of credit cards on file comes up – as it did in my recent online column "Your 2012 Resolution - Stop Extending Credit." I am inundated with questions, comments, and requests for copies of the letter we give to patients explaining our credit card policy. The column was the most popular yet; as one of my editors put it, "Joe's goin' viral!"
I've put together an FAQ to answer the most common questions. However, if you have a question not addressed here, leave a comment below, or feel free to e-mail me at firstname.lastname@example.org.
How do you safeguard the credit information you keep on file?
The same way we do medical information; it's all covered by the same HIPAA rules. If you have an EHR, it can go in the chart with everything else; if not, I suggest a separate portable file that can be locked up each night.
How do you keep the information current, as cards do expire?
The expiration date is right there next to the number; we check it at each visit, and ask for a new number or date if the card has expired.
Don’t your patients object to signing, in effect, a blank check?
Some did object initially – mostly older patients. Nowadays, a wide chasm seems to have formed in financial philosophies, right at about age 35 years. If you’re older than that, for example, when you receive your checking account statement each month you probably say, "Thank goodness they still include copies of my canceled checks." If you’re younger, you probably say, "Why do they send all this paper with each statement?"
But when we explain that we're doing nothing different than a hotel does at each check-in, and that it will work to their advantage by decreasing the bills they will receive and the checks they must write, most come around.
And they’re not "signing a blank check" – all credit card contracts give cardholders the right to challenge any charge against their account.
What’s the difference between this and "balance billing?"
"Balance billing" is asking patients to pay the difference between your normal fee and the insurance company's normal payment. That's a breach of your managed care contracts. What you want to charge to the patient's credit card is the portion of the insurance company–determined payment not covered by the company. For example, you charge $200, Medicare approves $100, and pays 80% of that. The other $20 is the patient’s responsibility, and that is what you charge to the credit card – instead of sending out a statement for that amount.
My office instituted this policy after you suggested it in your American Academy of Dermatology course. So far, one patient has called to ask if it is legal, and one insurance company has inquired about it. How do you respond to such queries?
Of course, it's legal. (See above.) Ask those patients if they question the legality every time they check into a hotel or rent a car. We have had no inquiries from insurers, but my response would be it's none of their business; you have every right to collect the patient-owed portion of your fees, and insurance companies have no say in how you do it.
How do you handle patients who refuse to hand over a number, particularly those who claim they have no credit cards?
We used to let refusers slide, but now we’ve made the policy mandatory. Patients who refuse without a good reason are asked, like any patient who refuses to cooperate with any standard office policy, to go elsewhere. Life’s too short. And "I don’t have any credit cards" does not count as a good reason.
Everybody has credit cards in this day and age. My office manager does have authority to make exceptions on a case-by-case basis, however.
One surgeon I know asks "no credit card" patients to pay a lawyer-style "retainer" which is held in escrow and used to pay receivable amounts as they come due. When presented with that alternative, most suddenly remember that they do have a credit card after all.