How to Have 100% of Patient Payments on Auto Draft

One of the wisest financial decisions that your practice can make is to make automatic draft of funds not an option, but rather, standard operating procedure for payment. The main benefit here is control – specifically, control of when you get paid for your services. Furthermore, because your profession typically has tepid penalties for not paying on time – if these are enforced at all – accepting payment by check can put your practice at the end of the line when a patient’s obligations exceed the amount of funds available in a payment cycle. Remember that people pay bills in order of the severity of penalty for not paying on time; nobody is going to have their power cut off in order to make sure that your office gets paid this week.

Your goal should be to have 100% of your patients on automatic draft. How you present it determines how close you come to reaching this goal, and presenting it as a choice is definitely not the way to get there. If you present both automatic draft and payment-by-check as options, the question you are asking your patient is, “would you like to control when we get our money, or would you like to give up that ability?” Given that choice, many people will choose the former.

On the other hand, when automatic draft is presented as “this is how it works at our practice”, most people will cooperate with you. Yes, the patient has the right of refusal – but checks are only accepted in situations where the family verbally states that they do not want to cooperate. In other words, unless they request otherwise, payment will be made by automatic draft.

This brings me to the issue of justification  – the “why” in requiring automatic draft for payment. You are the only profession that I have ever worked with that routinely offers interest-free financing. That is almost unheard of in the marketplace, and it is a very significant financial benefit to the family.

For that reason alone, your justification to the patient should be: “because we provide interest-free financing, we require automatic draft for payment.”

Therefore, unless the patient says “no”, automatic draft is then how payments will be made. As noted in previous posts, ask for two accounts for payment; one designated as the active for drafting and one as a back-up payment method.

A final point: your agreement calls for you to provide a high quality of care to the patient, and in return, the patient agrees to pay you on time. Both parties have an obligation to keep their respective commitments, and you are keeping yours. Automatic draft simply ensures that your patient honors their end of the agreement. After all, your financial manager has much better things to do than make collection calls – a function born of non-compliance that is a complete waste of that person’s time and resources. Weigh that cost against the processing fees, and automatic draft becomes the way to go.