Everyone in an organization understands how important is to receive payments, right? So why are so many people reluctant to ask for them?
When it comes time to collect on overdue accounts, many employees seek more indirect, less uncomfortable, methods for contacting customers or patients. This often means that your accounts receivables department avoids attempting to call consumers who are delinquent.
The truth is, calling is the most effective technique to recover debts. Whether your staff is uncomfortable, too busy, or simply believes that collection calls are a waste of time, we’ve created a simple 8-step process for connecting with more consumers and collecting more of your overdue accounts, on every call.
It is critical to confirm the first and last name of the person you are speaking with in reference to a debt. Under the Fair Debt Collection Practices Act (FDCPA) you are only permitted to discuss a debt with the customer or patient or one of the following:
- Spouse
- Lawyer
- Parent or guardian (if the customer or patient is a minor)
You may also discuss the debt with anyone the consumer or patient has given permission to. This could be an insurance company, power of attorney, or another family member handling their affairs. In addition to following collection industry regulations, medical office staff must also be sure to stay HIPAA compliant.
2. Identify yourself. Be clear about who you are and the company you represent.
3. Request payment in full. The way you phrase this question is critical to the success of every call. Do not ask if they can pay down their balance, or how much they are able to pay today. Additionally, do not start the conversation by offering to help set up a payment plan. You may want to offer that later in the conversation, but do not make that your opening offer.
Here’s what you should say: “You have an unpaid balance of $200 and payment is due in full. Which credit card would you like to use to pay this balance today?” Phrasing the question this way makes anything less than payment in full seem like it’s not an option.
4. Psychological pause. After you ask for payment in full, it is important to let them speak next. Rather than trying to fill the awkward silence, be patient and get ready to listen. They probably were not expecting your phone call, so give them time to digest what you just told them. Also, it puts the burden of answering your request on them. If they do not speak, repeat your request from Step 3.
5. Determine the problem. If the customer or patient makes an objection, and they often will, make sure you understand why they cannot pay. Repeat back to them your understanding of why they cannot pay. After you have listened to the reason, you have to determine if their reason is a real objection or a stall.
6. Determine the solution. “Let’s put our heads together and find a solution.” That should be your attitude. If you are setting up a payment plan, your opening position should be for half the balance due immediately and split the remaining balance into two payments. Many accounts receivable managers believe that you have to set up a payment plan even if the customer wants to make small payments. But that is not true.
Consider the patient who wants to pay their $500 bill in monthly increments of $25. That would take nearly two years to pay off! Before agreeing to a monthly payment amount, you should establish an office policy on what is acceptable. Looking for more ways to streamline your AR management? We’ve got you covered here.
7. Close the deal. If you were unable to get payment in full today, you need to clarify and verify your payment plan so there aren’t any misunderstandings. Let them know that if they do not honor their commitment or call you to make other arrangements, that you may send them to collections without notice. Don’t threaten them. Just let them know in a nice way that collections is an option.
8. Update your files. Make sure you take good notes. Anything you learned from the conversation could be helpful if you need to call them back. If you set up a payment plan, make sure you have a tracking plan in place to verify that they have made their payments.
Finally, our best advice for getting more comfortable (and more successful!) at calling to collect on overdue accounts is to practice, practice, practice! The more comfortable you are talking with customers about their bills over the phone, the more success you will have. Of course, you can always leave recovery to the experts. Give us a call today to discuss how Revco Solutions can help you recover more.
