This time of the year is a good time to think about converting to either all cash or more cash in your practice. You see, here's what usually happens. People start out in the profession and then they go into private practice then say, "Well, I'm not on any insurance panel so I got to be cash. They have cash and I usually charge a little price." Then after a while, they say, "Wow, I'm turning a lot of people away because I don't have insurance." So, they join a bunch of insurance panels.

Then after a while, they say, "Well, people that are cash practitioners are making a lot more than I am. I'm getting paid an average of $70 a session. They're getting paid an average of $120 a session. I should go more toward cash." Eventually, you have a lot of people go to all cash or mostly cash. I want to talk to you about how to do that. First of all, I would suggest that you look at your low payers. Any EAPs that are low payers, any insurance companies that are low payers and decide which ones...

Hi, this is Dave Kats from Therapist Consultants and I have a tip for you.

As insurance weakens, some insurance companies pay less and less and less, and there comes a point in time where you have to kick the low payers to the curb. Where you have to look at the insurance companies that you have and see what they’re paying and if they’re not paying enough, I think you have to get off that panel and then charge the patient cash. I think in the Mid-West, in Florida, in Texas, probably most areas in the United States; probably $68 is about the breakpoint. If they’re not paying you at least $68, you probably just need to get off that panel, be an out-of-network provider, and then have the patients pay cash because, here’s what we’ve found out, it actually cost between five to ten dollars to have you file insurance especially if you have some outside company doing your billing. Instead of the insurance company paying you $58, really they’re in essence...

This is Dave Kats with Therapist Consultants and I have a tip for you.

Now, this tip is more appropriate for those people who take insurance than those people who have a cash practice but it's important for both of you, and that is every month you should be running an aging of accounts. Now what is an aging of accounts? An aging of accounts is a report that tells you what patients owe you money and how much they owe you and when they owed you for how long they've owed you. It'll have the patient's name- the report will have the patient's name. It'll say they owe you so much money, 0 to 30 days, 30 to 60 days, 60 to 90 days, 90 to 120, and over 120.

Now, if you're an insurance practice and somebody owes you money from 0 to 30 days, I wouldn't get too excited about it yet because probably insurance just hasn't paid yet. When it gets over 30 days, you have to look at each account that's over 30 days and say, "Why has this bill not been paid?" Then you have some choices, you're either...

Hi, this is Dave Kats and I have a tip for you. 

People a lot of times ask us, ‘what are the most prevalent and best software out for billing insurance?’. The first thing I would say is this, every therapist should be using their own software. Sometimes I see a therapist that accepts insurance and they will go to Blue Cross to file, Aetna to file, UHC to file. It is better having your own software. If you would like to have something free, I suggest that you use Practice Mate which is by Office Ally. Just look up Office Ally and Practice Mate. It has a great billing system and is absolutely free. If you are a cash practitioner, I would use this type of software to keep your practice organized and your notes organized. If you can afford to pay for software, there are two that have become the king of the hill in the last few years. These are Therapy Appointment and Therapy Notes. We use Therapy Appointment in our office, and we are fans of Therapy Appointment. It cost...

Hi, this is Dave Kats from Therapist Consultants and I have a tip for you.

Some people, some therapists have trouble collecting money. They have, what I call, a poverty complex, and I found the best thing to help you with a poverty complex is to have a set of scripts that you use when collecting money from the patient.

For instance, here's one script that we always use in our clinic. When the patient comes to the front-- if you haven't charged them before they go back, and they come up to the front. You say, "That will be $125 for today. Do you prefer to pay by cash, check, or credit card?" And then you just look down and let them decide. But always use that, "Do you want to pay by cash, check, or credit card?" Because then that gives them a choice of yes's. Yes, I'll pay cash, yes, I'll pay by credit card, or yes, I'll pay by check. Always use that one when they come to the front, "Your fee today was $125, do you want to pay that by cash, check, or credit card?"

Of course, once...

Hi, this is Dave Kats from Therapist Consultants and I have a tip for you.

As insurance weakens, some insurance companies pay less and less and less, and there comes a point in time where you have to kick the low payers to the curb.

Where you have to look at the insurance companies that you have and see what they’re paying and if they’re not paying enough, I think you have to get off that panel and then charge the patient cash.

I think in the Mid-West, in Florida, in Texas, probably most areas in the United States; probably $68 is about the breakpoint. If they’re not paying you at least $68, you probably just need to get off that panel, be an out-of-network provider, and then have the patients pay cash because, here’s what we’ve found out, it actually cost between five to ten dollars to have you file insurance especially if you have some outside company doing your billing.

Instead of the insurance company paying you $58, really they’re in...

David Kats:  Hi, this is Dr. David Kats and Dr. Michael Perusich. We have a video tip for you. Most people now are thinking about moving to a cash basis, either to a total cash basis or a partial cash basis. You have to decide what to do in your practice because insurance companies are paying less and less and less every year. Just this year, their deductibles went way up and the-- What they're paying went way down.

Michael Perusich: Yes, the reimbursement trends keep going down. Analyze your practice. We recommend doing an excel spreadsheet, and if you're a member, we already have that spreadsheet built for you, get it on the back office, but we recommend that you analyze your insurance companies and see what your reimbursement is compared to what your fees are. You may be really surprised. You may find that many of the codes that you're submitting to insurance are not getting paid well.

David: Yes, as a result, you'd probably be better either going to cash with that insurance...

David: Hi, this is Dr. David Kats and Dr. Michael Perusich. Today we have a video tip for you. I'm going to talk to you about verifying insurance. Let me start, and then you finish on this. It's important that you verify insurance on every patient that has insurance if they're going to use the insurance in your office. Now, it used to be in the old days, which means a year or two ago, we called all the insurance companies to verify the insurance coverage, and we'd sit on the line for 15 or 20 minutes waiting for them to come on the line to give you the insurance coverage. Right now the online verification has gotten so good that nearly everybody has switched over to online verification, and if you haven't, probably now is the time to get started.

Michael Perusich: That's absolutely right. You said something very important in there. You don't just verify insurance with new patients, you verify a patient's insurance every year. That's really important, and not just to find out if...

Michael Perusich: Hi everybody, this is Dr. Michael Perusich and Dr. David Kats. We've got a video tip for you this week. One of the things that we always recommend is checking into every year doing a little checkup on your professional liability insurance and making sure that you're covered in the manner that you should be.

David Kats: That's right. It doesn't take but one call, and it's usually they're very interested in talking to you. You can usually get right through and talk to your malpractice carrier and find out if you're doing anything that you need to have special coverage for. Most insurance malpractice carriers will cover you for about anything, but a lot of times they want you to let them know if you're doing anything out of the ordinary. I'd say, every year or two, you probably should call your malpractice carrier and just talk to them and see if they feel you're properly covered.

Michael: That's right. Making sure if you've got associates in your practice, if you've...

Dave Kats: Hi, this is Dave Kats and Dr. Michael Perusich with Therapist
Consultants, and we have a tip for you. You know, you need to know what each
insurance company is providing as far as repayment to you, so you're aware of
where you stand with each insurance company.
Dr. Michael Perusich: That's absolutely right, David. You know, it's always amazing
to me that we go through our practices, we're busy seeing our patients and doing
those things, and yet, we never take the time, in some cases, to really stop and think
about what are we getting paid. Are we actually getting paid enough to actually
make some money because that's why we're in business?
Dave: Yes, sometimes your overhead is actually more than the amount you're
getting paid for that hour.
Michael: That's right.
Dave: If you don't get rid of the low payers, you won't naturally create room for the
high payers. Another reason you should lay out as list of what each insurance
company pays you, is because then you know who to go after as...