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Online Sale of Patient ARs
Staff Reporters
In another sign of the contracting economic times, FierceHealthFinance is reporting that some struggling hospitals are using the internet as a new channel to cut their write-offs, and bad debt ratios which lower stock prices, if publicly-held.
Exit the Debt Collectors – Enter the Auctioneers
Rather than simply hiring agencies to collect patient bills, some hospitals have begun to put ARs up for auction online. Bidders on the debt include the same agencies that serve the hospitals, some of which provide guaranteed payments to hospitals in exchange for access to the debt. The auctions are also attracting other companies that buy the debt outright.
Intermediary Channels
Many of these auctions are run through intermediary channels like www.ARxChange.com, a TriCap Technology Group site; while others use www.medipent.com Medipent LLC. The companies vet collectors to see that they will use the right tactics before participating in auctions, and also, try to make sure they comply with the hospital standards for collections. Also, hospitals have the final say over who bids on their accounts.
Critics
Despite safeguards, some critics argue that auctions change the dynamics of hospital collections, unfavorably. Usually, collectors are paid a percentage of what they collect, sometimes more when they collect more. But, in many of these cases, winning bidders get to keep all of the money they collect. This gives them a greater incentive to be aggressive in their tactics, according to the Wall Street Journal.
Assessment
When will debt-auctioning filter down to the individual clinic and medical practice level? “It is only a matter of time”, according to industry expert Hope Rachel Hetico; RN, MHA, CMP™ of Atlanta, Georgia
Conclusion
Your thoughts, opinions and comments are appreciated?
Related Information Sources:
Practice Management: http://www.springerpub.com/prod.aspx?prod_id=23759
Physician Financial Planning: http://www.jbpub.com/catalog/0763745790
Medical Risk Management: http://www.jbpub.com/catalog/9780763733421
Healthcare Organizations: www.HealthcareFinancials.com
Health Administration Terms: www.HealthDictionarySeries.com
Physician Advisors: www.CertifiedMedicalPlanner.com
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Filed under: Accounting, Health Economics, Healthcare Finance, Managed Care, Taxation | Tagged: ARs, debt collections | 1 Comment »
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