Share this article on:

If Handled Sensitively, Collecting Copayments Can Generate High Returns

SoRelle, Ruth MPH


After the Emergency Treatment and Active Labor Act (EMTALA) was enacted, emergency departments across the nation stopped asking patients for the co-payments designated in their insurance policies. No matter what it said on the back of patients' insurance cards, hospital personnel left the money on the table, afraid federal officials would land on them hard if they asked.

Today, with a shift in collection times, they are once again asking for money. Now, however, they wait until after triage, until the physician has seen the patient, and tests have been ordered. In many cases, they ask for the copay at about the same time they prepare the patients for discharge.

“We think we've got a clear and moderately well defined process of admission/registration in the emergency department,” said Thom Mayer, MD, a chairman emeritus of emergency medicine at Inova Fairfax Hospital in Falls Church, VA, and a member of the group BestPractices. “When people come in, they are scared, bleeding, and hurt. It's a surprise to them that they are at the emergency department, but it's not to us. At Fairfax, we see 75,000 visits per year. Those people don't bring the stuff they need when they go to the emergency department.”

Often that meant the issue of payment was moot. “We decided that what we needed was a discharge process,” said Dr. Mayer. “Instead of saying, ‘Adios, good luck,’ we take them through a discharge process on their way out the door.”

Back to Top | Article Outline

Asking at Discharge

The process uses a person deployed at the back door to help with discharge. Usually, said Dr. Mayer, it's a financial resource person — someone top flight who gets paid a little more.

As the person checks out, the hospital person says he wants to make sure that all the information is correct. That's important, he said, because the check reveals that 22 percent of patient records have wrong information, either the address, telephone number, or insurance information.

Most come in crisis, making the errors understandable, he said. “We correct that going out of the door. Our group is a fee-for-service group of emergency physicians. Having that information correct is critical.”

“The amount we collected was in excess of $720,000 going out the back door. The return on investment is great.”

Dr. Thom Mayer

“There are ways to make it work. Our competitors locally do it.”

Dr. Robert Takla

Then the discharge person asks, “Would you like to take care of your copay or put a deposit down? The amount we collected was in excess of $720,000 going out the back door. The return on investment is great,” said Dr. Mayer. “This program gives our hospital and BestPractices a competitive edge.”

Collecting copays or “deposits” was common in the 1980s, said Mike Williams, the president of the Abaris Group, a California-based emergency/trauma consulting firm. “That was the way we trained our staffs in the emergency department. That pretty much stopped with the EMTALA rules and regulations. It was pretty much an overreaction to what EMTALA tells us.”

Mr. Williams said it is permissible to ask routine financial questions as long as the medical screening exam is not delayed for financial reasons, according to guidelines from the Office of the Inspector General of the U.S. Department of Health and Human Services and interpretive guidelines from the government.

“Hospitals all over the country that are asking for copays ask for them on departure from the emergency department,” said Mr. Williams. That might not be the most propitious time, he said. Often, patients are anxious to leave the emergency department after their treatment and unwilling to wait.

EDs are beginning to ask for copayments after tests have been ordered or at discharge

The best time might be during the gap that occurs after registration and triage, while the patient is waiting in the room, he said. Sometimes, it's a long wait for laboratory tests.

‘It's an opportunity to assist patients to get discharged faster,” he said. “The personnel come and say we can now collect your co-pay. If you can't pay, it won't change a thing. We will still take care of you.”

The measure is having some success, he said. Copays range from $50 to $150, he said. “$150 is not that unusual any more.”

Back to Top | Article Outline

ATMs in the ED

To the hospital, the money may seem too little to try to collect after the fact, even though it can add up to a substantial sum. Compared with a total hospital bill, it may seem a small amount, and a person may not pay until several bills have been generated or not pay at all.

“It's interesting,” he said. “How many people go to McDonald's and expect credit? If you wrap the emergency department in a nurturing environment and you have alternatives available, many will pay at the time of service.”

He estimated that as many as 25 percent of patients will have some ability to pay the copay. “That's money you have without all the other things and without the risks of not being paid.”

Mr. Williams said asking for the copay can be done sensitively. “We all know the horror stories of someone asking for payment and implying patients won't be treated without it,” he said. That is often counterproductive because many patients know an emergency department has a responsibility to triage and treat when needed.

There are a number of ways to help patients pay their bills, he said. An ATM in the emergency department can give patients access to their funds. And EDs can take credit cards, Mr. Williams said, with their logos up front so that patients know that is a possibility. A simple self-addressed envelope the patient can take home will speed the process, and make the point that patients are expected to take care of their copays.

“Emergency departments are not naturally financially stable,” he said. “They can't afford to leave dollars on the table. The margin is needed to keep them stabilized.”

Back to Top | Article Outline

Scripting the Process

Robert Takla, MD, the medical director of emergency medicine at St. John Northeast Community Hospital in Detroit, said the move to collect co-pays appears to geographical. “Hospitals in some parts of the country do it, and others do not,” he said.

When it was proposed at his institution, he wanted some indication that the return would be more than the cost. Consultants made projections based on how much they thought the emergency department could collect, he said. He wanted data to back up their projections.

The consultants estimated that they could collect copays on 70 percent of patients who were insured and 20 percent of those who were self-pay. “I asked if this was an accurate reflection of what our institution would collect based on our demographics,” he said. “There are ways to make it work. Our competitors locally do it.”

Some things were subtle, such as giving patients self-addressed envelopes if they didn't have money with them. ATMs in the emergency department and the ability to take credit cards increased payment, he said.

He said a separate discharge area for the end of the patient's visit makes asking for payment easier. Financial personnel can say, “We are preparing your discharge paperwork. The nurse is getting your prescriptions. Would you like to pay your copay now?”

Scripting to avoid misunderstandings is important, Dr. Takla said. “One way to make it clear is to say, ‘Your insurance require $50 copayment. Please pay on the way out.’ Don't say we are requesting it. Say your insurance requires it, at the tail end of the visit.”

If the copay issue is not handled correctly, Dr. Takla said, it can slow down patient turnaround. It also can increase the number of personnel needed in registration, or discourage patients from returning.

“If we see a dip in volume, maybe this will have something to do with it,” said Dr. Takla. If the census drops by 1,000 patients annually, will collecting the copay be worth it?

Copyright © 2004 Wolters Kluwer Health, Inc. All rights reserved.