# Finance Charging?



## JenelleM (May 10, 2012)

Hello.  Pretty sure I already know the answer to this, but I'll post it anyways.

My office manager wants to add a $2.00 finance charge to every patient we are sending statements to.  These statements might be coinsurance or deductible amounts, or missed copays.  Is it even legal to add a finance charge to any of these bills - especially the deductible/coinsurance ones?  I say no, but she says yes.  

Any input would be appreciated!


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## helehcim (May 10, 2012)

Is the office attempting to collect the co-insurances or co-pays before the appointment?  If not it seems wrong to bill them another $2 for sending a statement after the insurance processes the claim if there was no attempt to collect the money at the time of the appointment.  Maybe some more vigilant front office work trying to collect the co-pays/co-insurances and deductibles would be a better idea?  I'm not saying you guys aren't doing that already.

She might want to look into the legality of calling it a "finance charge" vs. a "statement fee".  In my mind "finance charge" means there was some money borrowed.  There's also the contracts with insurance, you may want to check those, too.

Remember the patients are the customer, and while some of them are difficult to get money out of the majority, in my experience, do pay their bills.  I  hope that's  your experience too...otherwise what a mess


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## JenelleM (May 10, 2012)

Thanks for the quick response helehcim.   

All co-pays are collected at the time of appointment.  Coinsurance and deductible amounts are billed out once the EOB/ERA is received in the office and the payments are applied.  

I can understand tacking on an extra charge if you are sending out a second or third statement on the same bill, however I do not agree that it should be automatically added on the first statement being sent to the patient.


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## BEARDOG (May 11, 2012)

I would hesitate and do a lot more research before doing this.  There are very strict rules regarding "lending institutions" and when you start adding finance charges it could get very sticky for your practice and attract unwanted attention, fines, etc. 

All I am saying is you have to make sure you are  not violating any rules, innocent or not, as sometimes the feds don't look very kindly on violations


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## specialtycoder (May 11, 2012)

Beardog and Helehcim make very good points.  To those, I would add that this sounds like astoundingly poor customer service.  Losing a patient's goodwill is not worth $2.00.


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## JenelleM (May 14, 2012)

Thanks everyone for your input.    I agree that it is very poor customer service and I cannot imagine why she wants this policy in place.  I'm just glad I caught it before I actually printed any of those statements. 

Thanks again!


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## BEARDOG (May 14, 2012)

She probably is trying to recoup some of the costs of sending the statement (it costs approximately $7.00 to $14.00, depending on the article you read, to sendout one statement-postage, printing/stuffing/ the envelope, etc).  While I feel her pain perhaps it is better to adopt the policy of limited billing if no payment received -3 billings then send to collections or writing off to bad dept w/o if no payment.  If the patient is paying the bill, not a lot you can do about it as long as they are paying the amount that was agreed upon on a monthly basis if they are carrying a balance. Don't know for sure, just guessing that may be the, or one of the reasons.


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