We are a billing and collection service for physical therapy private practices. Jet PT Billing is owned and operated by a former private practice owner who knows what it takes to make your business thrive.
A common question we often get when meeting with clients and potential clients is “How should I handle patient statements and balances owed by patients?”
Like most things in life, the best way to handle patient balances and statements is to be proactive.
By that I mean, creating a system that ensures that you never have to deal with them in the first place.
Train your front desk team to always collect any co-pays for coinsurance and all deductibles up front at the time that service is rendered. That way you can bypass the whole issue of patient statements altogether.
However, I’ve been in this business long enough to realize that there is no perfect world and even the tightest run practice is going to have some patients with a balance. So, we need a way to handle these balances by using patient statements effectively.
Developing a Simple System to Handle Patient Statements
The first thing we need to do is to establish when to send out the initial statement for any balances owed by a patient.
The best practice we’ve seen is to send out that initial statement as soon as there is a patient balance.
That is when you want to set up an account for that patient and get that first statement out in the mail.
This establishes an initial tracking date.
This forms the basis of our simple 3 color system to keep your statements organized.
If the patient is responding and making payments on their account, we simply continue to send out an updated statement every 30 days.
Send out the first statement and all statements for accounts in good standing on white paper.
What If A Patient’s Account Falls Behind?
If a patient has not made any attempt at a payment based on that first statement, the next step is to send out a second statement 30 days later.
What we do for our clients and what you can do if you’re printing out your own statements, is switch the paper color.
That second statement goes out on yellow paper.
Yellow is a subtle signal of caution in most people’s minds and let’s them know that something is not right.
This gets their attention and often that is all that is needed to trigger action on their part.
You can also add some friendly wording that says that the account is past due.
So, we’ve sent out that first statement on white paper, a second delinquent one 30 days later on yellow.
What Do You Do If They Still Don’t Pay 60 Days Later?
After you’ve given them another 30 days after sending out your yellow statement, you send out a “Final Demand Notice.”
Send this out on a light red or pink paper. This notice really starts to put some pressure on them.
Your goal is to create some urgency in their mind. They see the red and the wording “Final Demand Notice.” Hopefully this gets them to send in their payment or contact you to make arrangements.
If there is no patient contact or payment after a few weeks of sending out this statement, it gets a bit trickier.
Many of our clients ask that we send out a collection letter at that point on their behalf. They want it on our letterhead because it elevates the situation. It sends the message that this is serious; my physical therapist has turned this over to a third party.
So, what we do is send out a letter on our letterhead that says we’ve audited their account and found it to be past due. We stress that services were delivered in good faith and yet they are still refusing to pay.
This is our attempt to collect this money before turning it over to a final collection agency.
What About Collection Agencies?
Often the threat of turning a debt over to a collection agency is enough to motivate an individual.
Most people are familiar with the disruption and embarrassment that can cause. Those annoying phone calls at work and at all hours.
Again, they know they owe you the money. This is not your fault to try to collect this money.
Ultimately it is up to you as the practice owner to decide just how much you want to turn up the heat on a patient.
When we get to this point with one of our clients, we tell them that it is worth trying to have your staff contact them directly. Many times, your office has a relationship with a patient established and something can be worked out.
Many clients get so bombarded with mail from insurance companies and other providers that they are not sure what they really owe.
A few simple phone calls can successfully solve a lot of these misunderstandings without resorting to collections.
This simple system has worked wonders for me when I was running my own practice, and we use a version of it with our clients.
It can increase your cash flow significantly and reduce those patient balances to a minimum.
The main thing to take away from this article is the importance of having a consistent, systematic, organized way of handling statements and patient accounts.
If this is something your practice struggles with and you need some more advice and help, remember we are a simple call or click away.
When practice owners start thinking about outsourcing their billing departments, one of the first things they worry about is delays in receiving money from us. They want to know if there will be a lengthy period between choosing us and receiving deposits.
As someone who ran a practice for many years, I am acutely aware that cash flow is vital to your success. You have bills to pay, payroll to meet, and supplies to purchase. The last thing you can afford is a disruption caused by outsourcing your billing.
When I founded Jet PT Billing, I knew I had to communicate completely and transparently with my potential clients so there were no surprises.
That’s what I want to do in this article. No matter whom you choose to work with for, your billing needs these 3 things will go a long way to easing the transition.
First, Plan Ahead for the Transition
Sometimes there are abrupt reasons to make the change. Maybe you’ve lost a key team member that used to do all your billing, it’s not ideal but it can be handled.
We tell our clients that it is a transition time of two to three weeks with most practices.
Much of the success of changing your billing over to a third party is dependent on you, the practice owner.
When I tell clients to plan ahead, I suggest that they give us a four-week runway to implement our system. That way there is little to zero delay in cash payments to your practice.
This allows time to gather all the necessary information from you and your team. It also allows some slack in dealing with any issues we encounter with Medicare and other large insurance carriers.
Our biggest hurdle is dealing with Medicare on your behalf. We’ve found that it takes about three weeks for the transition to be complete.
That’s why it’s important to start the transition well in advance. This way your business can continue without any undue hardship.
Once you’ve set aside that 4-week window of time, it’s time to move onto the next step.
Second, Provide Your Billing Company with All the Information They Need
Your billing company will need specific information that allows them to communicate with carriers and Medicare on your behalf.
Without this information the transition stalls and nothing can move forward.
Two pieces are the following digital identifiers for your practice:
• NPI number • Tax-ID number
Once we have these two documents and any other relevant information, a billing company can put those into the Clearinghouse’s system. They pass it on to the payers, laying the payment conduit.
Again, with Medicare this is a three-week process and most private carriers are up and running in a week or so.
Since many claims can be submitted electronically, the claims process does not add any delays to the transition.
By setting aside a fair amount of time, choosing a solid third-party billing company, and sending them all the information they need, there should be absolutely zero reason for long delays and the process to drag out.
There’s only one thing left…
Finally, Trust the Process
A reputable third-party billing company should have a process in place for these transitions.
Ensuring that you’ve chosen a solid company to form a relationship is vital.
Communicate with them and trust the process.
We find that when working with our clients, the ones that have the smoothest transitions are the ones who give us all the information we need to get them set up in our system and communicate clearly along the way.
If you’re stuck in a difficult transition or just want some more information on how the process works, we are always happy to answer your questions and dive deep into the details.
Choosing to outsource your billing is a big decision – we don’t take it lightly.
Contact us today to see how easy we can make your team’s transition and remove the headaches associated with billing from your day-to-day operations.
In this quick little article, I just wanted to take a minute and address something that many physical therapists face when they are trying to optimize cash flow and profitability.
We are going to talk about lost income.
This is one of those areas that practice owners often overlook or just don’t want to even get into.
The truth is there are a couple of simple things you can do and help your staff do to really generate additional income for your practice.
First, what is lost income?
When we talk about lost income at Jet PT Billing, we are referring to income that is never going to be seen or recaptured.
We are not talking about billing errors or incorrect claim filing.
If from a billing standpoint, a claim goes out incorrectly, that claim can ultimately be corrected.
You can refile with the insurance carrier and have that claim adjusted to reflect the correct amount.
This income is not lost. It’s just making its way into your bank account as quickly as you’d like. We can help you with that too.
What I am referring to is actual lost income. This is money that you will never receive and cannot be recovered.
There are two big ones and they have a super simple solution.
Your Percent Arrivals
Just to be clear, when we use the term percent arrivals, we are referring to the percentage of your patients who show up for their already scheduled appointments.
Your goal for percent arrivals should be around 90 percent.
If you are lower than this there’s some steps you can take to pump that number up and capture lost income.
You may think your practice and front desk team is doing a fine job with patient interaction but this area tends to take most operators by surprise.
Let me give you an example. If one of your patients has three appointments to see you scheduled for the week and only shows up for two, it is tempting to think, well two out of three isn’t too bad.
It was only maybe 30 minutes of your time?
In reality your percent arrival is only 66% and you can never get that money or time back. If that continues unchecked and you apply that percentage to your potential number of appointments it is costing you some real money.
The second area…Percent Prescribed
Percent prescribed can give you some insight into how close to your practice’s current potential you are.
A simple definition of Percent prescribed is the percent of appointments your team books with a patient versus the number of appointments a provider authorizes.
Again, if an insurance company approves 4 visits for a patient per week to remedy their problem and you and your team are only scheduling 3, you are creating lost income.
Some other points to consider:
If a patient is not showing for all of his or her appointments or not receiving all of their benefits in the form of appointments for treatment, they are not going to recover as well.
Your patient satisfaction is dependent upon their outcome. By ensuring that they are receiving their full allotment of visits and are showing up for them, you can really influence their outcome.
The best way to do this is to employ a simple three prong approach.
First, you need to work with providers when they are creating the plan of care.
By emphasizing that providers can be a major influence when it comes to instilling the importance of complying with the plan of care, your percent prescribed can improve significantly.
If your patient is trying to reach a specific functional physical goal we want to make sure that we and the original provider do everything we can to actually get them to completion.
We do not want them dropping off the schedule after 6 visits when they were prescribed 12 visits.
Second, we need to train ourselves and out teams to reinforce the importance of completing the plan of care.
Some patients do not see the benefit right away and get frustrated and drop out.
We need to help them enjoy the small wins and stress that they continue to reach the big win of hitting their goal.
This helps them see the value of physical therapy and look forward to their visits.
Third, we need to train our front desk team to be proactive when working with patients.
They are the first and last impression a patient has of out practice.
You can share you percent prescribed and your percent arrival numbers with your team and set goals for them as well.
Are they confirming all appointments?
Do they ensure that all patients know when their next appointment is?
Often times a few simple reminders is all that is needed to get these numbers up and prevent you from suffering from lost income.
Our numbers may never get to 100% but a little training and attention can bump them up and create much needed cash flow to your bottom line.
The best part, it costs you no out of pocket money to fix this.
You are going to vastly improve your performance in real dollars with a little effort on your part.
You won’t need any additional investment, there’s no marketing money spent, no additional software to buy.
It’s simply an investment of your time to help those staff members better understand what we’re all trying to do and help patients fulfill their dreams and goals. That’s really all there is to it.
If you would like to learn some other tips we have put together, be sure to check out all our articles and videos.
Remember we are only a phone call away and can help you build a practice that makes sense financially.
Something that’s on the mind of most practice owners is how long it takes to collect reimbursement from the various insurance carriers and Medicare.
In this quick article I’m going to share with you two simple calculations we use and that you can do yourself to see where you stand.
Calculate the Relationship Between Your AR and Your Charges The first thing to do is to figure out the total amount of your Accounts Receivables. Get the total number, everything that’s in there no matter how old it may be. We need a completely accurate assessment.
Then you need to know how much in total charges you are billing on average each month. For this number we need a rolling three-month average.
You can determine this by looking at the charges for your practice for the last thirteen weeks and divide that number by three.
This will give us the three-month average monthly charges.
Now take that number and divide it into the total AR amount.
Multiply that number by 30.
That gives us our total average days a charge is in the receivables account.
Ideally, we want to keep this number at 30 or less.
That would mean that we are turning our accounts receivable every 30 days.
Next, We Drill Down into Insurance AR For Insurance AR we want to calculate the total value of everything on the books less: patient balances owed, anything dealing with attorneys, and less any cash patients.
Once we take those out of the mix, we are left with a figure that reflects just the amount that the different insurance companies owe us.
Then we can perform the same calculation as above using this number in place of Total AR.
What we want to look at is the relationship between these two numbers. We want the number of days to collect our insurance money to be less than the total.
The bigger the discrepancy between these numbers the greater chance that we have something going on that’s not good.
Using the relationship, we can try to pinpoint where the problem is. Maybe, we have an issue at the front counter with our team not collecting as much cash upfront in the form of co-pays. Our cash patients might be stretching out their balances too far.
Every practice should consider the straight cash paying customer to be a great supplement to their income. It’s nice having a source of income that does not involve anyone else but you and the client, no complex insurance companies.
If your practice handles a lot of motor vehicle accident victims, you may be dealing with a lot of attorneys.
It is tough to control this cash flow since you can find yourself at the mercy of the legal system.
You really do not have a lot of control over this situation.
The trick is to minimize the amount of time it takes to receive your money from the sources that you can control and influence in the right direction.
Cash paying patients should pay for their services at the desk before they leave, and we need an organized system for our insurance billing.
Using a couple of simple calculations like these can show us where to put our attention and which of our systems is lacking as far as receiving our money in a timely fashion.
If your practice is struggling and you can’t figure out why it is taking so long to get your money, we may be able to help. We’ve been doing this a long time and have helped a ton of practice owners just like you get their payments in line.
I remember running my own practice and feeling frustrated when I was always waiting for money I had earned. I managed to solve this for myself and love sharing what I’ve found out with new clients and other physical therapists. Let me know if I can help you in any way. Even if it’s just pointing you in the right direction.
In this quick little article, I want to share with you something that often frustrates physical therapists running their own practices.
They say to me, “Kevin, just give me one measurement, one statistic, one number that I can use to tell me what is going on with my billing department.”
The number that we use here at Jet PT Billing is what is known as the Collection Ratio. I did not come up with this term, I got it from a friend in the industry a long time ago, but this number is a terrific way to quickly see how your practice is doing in terms of billing and collections.
So, to figure out the Collection Ratio for a practice we need to look at the most recent six weeks of information.
How to Calculate Collection Ratio
Specifically, we need two numbers:
• Collections expressed in dollars for the most recent 6-week period • Billing or Charges expressed in dollars for the most recent 6-week period
Once we have those two numbers, we can calculate a Collection Ratio.
To do this we simply divide the two.
For example, if we sent out $200 in charges and collected $100 our Collection Ratio would be .5 or 50%.
This allows me to use this information to predict my future activity, knowing that I am collection 50% of what I bill.
That really doesn’t sound too good, but those of us in the health care field we know that is the way the game works.
Now, there is something to keep in mind about all this. We do not want to compare data from one provider’s practice to the next.
Let me give you an example to show you what I mean.
If we have Practice A, and they bill $200 for a service and collect $100 their ratio is 50%.
We cannot effectively compare their performance to Practice B who also collects the same amount, $100 but bills $400 for the same services. Their ratio is only 25%.
These two organizations may be collecting the same amount of revenue but the fee schedule they use has a large variation. That’s why we do not want to get into the scenario of comparing apples and oranges between clients.
This is why when you are looking at using Collection Ratio to assess your practice you only want to look at data that is specific to your practice only. That way you eliminate the variables of differing fee schedules.
The collection ratio provides you with a way to compare how your practice is doing over time and as a means to predict future revenue.
There are many ways to look at collections and billing performance, but this is a nice place to start. If you need help with your specific situation or have other questions, please do not hesitate to reach out.
Today, I want to take a moment and run through a question we get asked every day. What should me AR or Accounts Receivable look like?
It’s a legitimate question and sometimes just looking at a full Accounts Receivable printout can produce anxiety and feelings of overwhelm. Admittedly, there is a lot going on there and it can be difficult to interpret all the figures.
Let me run through a couple of things from a high, overview level.
Generally speaking, your total Accounts Receivable (AR) should never exceed what your average monthly charges are.
If it’s getting larger, too much larger than your average monthly charges then it indicates in most cases a lack of follow-up. You probably have a good chunk of money sitting out there in the older age brackets that is not receiving the correct amount of attention.
We can use that AR report to properly channel our attention to where it is needed. Ideally you want to use this data to allow your collection team to apply focus to the accounts that need it.
When looking at where to focus you can divide the older unpaid accounts into:
• Less than 60 days • Greater than 60 days • 60 to 90 days • Over 90 days • Greater than 120 days
If your practice is expanding, you may notice these numbers increase as well. If your practice is staying the same in terms of volume or contracting, you would expect these numbers to stay the same or even decrease.
One thing you never want to see is the older accounts increasing disproportionately. No matter whether your business is expanding or contracting, these numbers should not continue to increase in proportion to the others.
For example, we do not want to see our accounts over 120 days growing. This shows that there is not enough attention being placed by the collections team on this area.
You can see quickly by looking at the areas in your practice’s A/R report where the focus is and where it is lacking.
These are general ideas, there are a few instances where things can cause these numbers to increase without triggering alarm bells.
One would be if you have many auto accident cases, these take longer to flow through the process. The other would be a high volume of cases that are under litigation. These types of cases call for a little give-and-take.
However, if your payer mix does not include an awful lot of litigation or motor vehicle cases than you should see those older accounts continue to decrease rather than enlarge.
These are just a couple of ways to peak at you’re A/R every month and judge where your practice is performing well and where you would want to shift the focus of your billing team.
Of course, we are always here for you at Jet PT Billing should you want a professional look at your accounts. Please do not hesitate to reach out if there is anything we can do for you.
In this article I’m going to give you some insight into what to look for when choosing a billing company. By showing you what separates Jet PT Billing from other billing services, I am going to give you some questions to ask whomever you consider handling your practice’s billing.
First and foremost, as the founder of Jet PT Billing I am also a physical therapist. I trained as a physical therapist and practiced as a physical therapist. For several the years I spent as a practicing physical therapist, I was in private practice, just like you.
This gives me some incredible insight as to what physical therapists who own their own practices deal with on a regular basis. Not only that, but I knew exactly what I needed and wanted from my own billing department.
When I left private practice and sold my interest in it, I did some consulting with other private practice owners. While I was consulting with these physical therapists, the primary area of emphasis that we were dealing with was billing and collections.
This is a fundamental reason why you don’t just run out and start a physical therapy billing service without knowing what you are doing. You need to know what works, what is needed, and what is wanted.
That is how Jet PT Billing came into existence. I took the time to distill what a high functioning billing department looked like in my own practice. I then filtered that knowledge through my work with other physical therapists and came up with a system that works for our unique market.
I doubt there are a lot of billing services out there that were founded by a physical therapist. That is the biggest thing that separates Jet from the competition.
Let me give you an example of how that translates into marked differences between us and the others in the market. These are things that you can use to figure out what you need from a billing and collection service.
We send out weekly reports, we do not wait until the end of the month or the end of the year to communicate what is going on with your business.
Every Monday morning, we send out graphical reports and spreadsheets that show exactly what we did on their account last week.
There’s more information in these reports than most practice owners need. We get accused of over-communicating, but we just want you to have as much information as possible. Our system can generate 120 reports and we are more than happy to show any client how to run them and what to look for in each one.
In our case, we pride ourselves on being 100% transparent in our dealings with our clients. They can see exactly what we see. There is nothing hidden from them. Plus, they can download and install our billing software on as many computers and systems as they want.
That’s why we exist the way we do, we want you to see exactly what is going on with your practice and what we are doing on their behalf.
Lastly, we offer incentives to our staff to collect your money as quickly as possible. We have the fundamental belief that when you are doing well, we are doing well.
These factors set us apart from the average run-of-the-mill billing and collection service operating in the physical therapy space.
If you have more questions or concerns do not hesitate to reach out to us. We can answer questions that relate to your unique situation.
Clients often ask us about the type of information that they should expect from a billing department. It’s easy to find yourself lost in the weeds on this issue. So, let’s take a minute and explain a few key points.
As the CEO of your business, this is a great question to ask yourself. It’s easy to overwhelm yourself with numbers and reports that may not be that important to you as a practice owner.
Let me tell you the numbers that you want to look at:
First, you need to be calculating and analyzing your Collection Ratio. If you do not know how to calculate this statistic, you can check out our previous article on the subject.
Next, you will want to know what your average number of days a bill spends in your receivables account. Look at you’re A/R and see how long it takes from the time you send out a bill until the payment for that bill arrives in your bank account.
From that information, you should be able to figure out what your average collection per visit is and how long it takes for the money to come your way.
Now you are able to add some predictability to your practice.
You’ll be able to use these ratios to calculate how much money in revenue you practice will generate over the next week, the next month, or the next quarter. This gives you better information when you communicate with your suppliers and vendors.
As a provider of outsourced billing departments, we pride ourselves with giving our clients this type of information. Every Monday we send out detailed reports that allow you to quickly see what is going on.
If you handle your billing and collections internally, you should be able to walk into that department on a Monday morning and have these types of questions answered. However, if you are receiving blank stares and excuses, then you need to consider a company that can provide you with this information.
If you find your practice struggling in this area, you may want to reach out and have some questions answered about just how easy it is to unload all this burden from you and your staff.
Let us know if we can help in any way. We’d be happy to show you what you may be missing in your billing department.
Teaching caregivers and patients is important in maintaining and managing rehabilitation progress: care plan, wellness or fitness regimen, functional enhancement, minimizing or managing risks from current problems, etc.
What do insurance companies and payers consider ‘PT patient education’?
The American Physical Therapy Association (APTA) defines it as “the process of informing, educating, training patients/clients, families, significant others, and caregivers with the intent to promote and optimize physical therapy services.”
How do Physical Therapists Bill for Caregiver/Patient Teaching Hours?
PT Practitioners should bill for the hours spent teaching patients or caregivers under the CPT code that best suits or matches the performed intervention, purpose of and intent for treatment or related demonstration.
For patient self-management of conditions such as asthma, arthritis or COPD, insurance companies require healthcare professional prescription, qualified caregiver and use of standard teaching curriculum to provide such training and education.
Here is the table of CPT Codes for commercial payers:
Before using the above codes, we recommend verifying the payer’s insurance policy.
These codes don’t include unsupervised instruction (example, videos being sent to patients).
PT Practitioners and Clinicians can also submit supporting documentation:
Handbook or detailed set of instructions given to the patient or the caregivers
Record of evaluation of patients’ and caregivers’ adherence or compliance with steps outlined in the handbook
Record of therapists’ time spent conducting the treatment, education (or demo and coaching session)
A lot of PT Billing confusion arises when practitioners use the wrong code when filing insurance claims. When is time spent treating patients considered initial evaluation and when is it considered re-evaluation? Aside from the APTA guidelines, we have compiled our most common scenarios and included the codes we used for fast, hassle-free claims approvals.
Here are real-life physical therapy scenarios to help you out:
What code to use
Patient is found to be suffering from or to have developed a related condition or a complication resulting from original diagnosis–needing a new care plan.
Patient undergoing care or treatment shows unexpected and significant change/(s) in condition, which may mean an unexpected or unanticipated improvement, or sudden decline–needing a re-evaluation of the cause of the change.
Patient is unresponsive to original care plan; no improvement or progress is seen as anticipated
Patient goes into surgery in the middle of treatment
Initial Evaluation (97161–97163)
Patient undergoing care or treatment presents with a condition that is totally unrelated to the primary diagnosis
Initial Evaluation (97161–97163)
Patient goes in for post-operation treatment that needs a new plan of care
Initial Evaluation (97161–97163)
Patient returns after 60 days of completing care plan and discharge with symptoms similar to initial diagnosis
Jet PT Billing was founded by Kevin Cappel, PT with the desire to provide a much-needed service based on his years of experience and multiple viewpoints relative to the profession of physical therapy and health care, in general. Kevin managed a large corporately-owned outpatient facility for ten years before venturing out into the world of private practice. During his tenure in private practice, he became quite intimate with the area of physical therapy billing and collections and was able to increase their collection per visit statistic from $82/visit to $104/visit while third party reimbursement rates did not increase.
JetPT gives PT Practitioners and Clinicians a risk-free assessment. Call us today at 855-217-5013 or email email@example.com.