January 25, 2018
Inside: If you offer tabs or charge accounts at your pharmacy, some of your patients may have outstanding balances. Discover tips to keep patients’ overdue bills to a minimum.
A competing pharmacy calls to tell you that your patient has requested to transfer her prescriptions. While it’s not a situation you want for your business, as part of the nature of pharmacy, you likely have to deal with transfers occasionally.
Then it gets worse.
You realize that the patient owes you money from previous charges.
Occasionally a patient can’t afford a copay and will start a “tab” with your pharmacy. Or, a patient will create a substantial balance on an in-house charge account by only paying off a small portion at a time.
Even worse, patients might transfer their prescriptions to avoid paying their bills.
What can you do to make these inconvenient patients pay up?
Most state laws forbid withholding a prescription transfer because of monies owed. If, however, your state considers transfers more of a courtesy than a requirement, you can refuse to transfer the prescription until the patient pays the bill. Check with your state board of pharmacy before refusing to transfer a prescription.
Independent community pharmacies offer charge accounts to provide another level of customer service that national chain and big box pharmacies can’t match.
Some independent pharmacies even offer an additional convenience. They use a service to draft patients’ monthly prescription bills from their checking account, similar to a utility bill or a car payment.
In these situations, you have limited options.
Patients can simply contact their physicians for new prescriptions, fill them at another pharmacy and effectively avoid paying their balances to your pharmacy.
As a business transaction, patients still have a financial obligation to pay for their prescriptions, but going through the costly legal process of filing a lawsuit, hiring a collections agency or going to small claims court to collect the debt likely isn’t worth your time and money.
Rethink how your pharmacy handles past due bills to avoid these situations in the future.
Actively working to prevent these situations before they happen will make your pharmacy a more profitable business. Try these ideas.
As an independent community pharmacy, you likely know your patients well.
If your pharmacy provides charge accounts or “tabs” as a courtesy, only offer the service to longtime patients who you know will pay their bills regularly.
Sometimes situations happen where a son or daughter takes over an elderly parent’s affairs and doesn’t pay the parent’s medication bill. But you can avoid most costly circumstances by only offering the service to your best customers.
Create a charge account contract for patients to sign.
In case you ever do need to go through the legal process of collecting a substantial debt, providing legal documentation is crucial.
With documentation on hand, you can also use it as leverage to remind patients with overdue bills that they signed a legally binding contract to pay for their charges.
Create an easy application form for patients to fill out so you can vet them. You can even create a form on your website so patients can fill it out at their convenience.
Ideas of what to include on your application:
Then, use a professional background check service to do a background check on each applicant.
Once a bill hits overdue, send patients consistent invoices.
If they use email, then regularly send past due email notices to patients with outstanding balances. Or, send the invoices through regular mail in a large priority envelope that looks important.
If patients with overdue bills come into your pharmacy to pick up refills or to fill new prescriptions, ask them if they would like to add on their past due bill.
Face-to-face communication will likely improve the chances of getting a patient to pay a bill in full.
Once an overdue bill hits a certain amount, refuse to fill the prescription until the patient pays the bill.
As an independent community pharmacist, you want to get your patients the medications they need, but you have to find a balance between your role as a pharmacist and your role as a business owner.
Continuing to fill prescriptions for patients with overdue bills isn’t profitable for your business.
Consider whether the costs of offering charge accounts or “tabs” outweigh the benefits for your business.
Even if you set an interest rate for past due bills on your charge accounts, one bad account may create more costs for your business than the entire service is worth. In the long run, paying the fees for processing credit cards may prove less expensive than providing charge accounts.
No matter how convenient you make it for patients to pay their bills or how diligently you send invoices, sometimes patients just don’t pay. It happens. All you can do is implement good business practices—and stick with them—to keep patients’ overdue bills to a minimum.
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