Months ago our 35-person group practice read with interest Dr. Joseph S. Eastern's article ("Slash Accounts Receivable: Stop Extending Credit," Guest Editorial, Dec. 1, 2005, p. 12).

He suggested obtaining a credit card "imprint" from all patients and billing them once the patient responsibility

On Jan. 1, 2007, I instituted his suggestions in my clinical center. To date, all my expectations have been exceeded for decreasing my bad debt write-offs and reducing the time spent in collecting payments. For the first time in 25 years of practice, I have adopted new business methods for collecting receivables as opposed to merely applying new technologies to old ways of doing business.

In the past, we extended credit to every patient who walked into our office without any verification or research. As insurance deductibles increased and more patients became responsible for the first $2,000-$3,000 of their medical care, our accounts receivable mushroomed. Now when we register a patient, we have them read and sign an agreement that, along with a credit card or voided check, allows us to immediately bill them for the patient responsibility portion of their bill. From the receipt of the explanation of insurance benefits, a patient collection is now completed in 1 or 2 days as opposed to weeks or months. We have eliminated the costs of sending out patient statements by notifying patients by e-mail of our payment.

Another advantage of the credit card processing system is that we can easily set up payment plans for patients with large balances. That takes less than 5 minutes to do, after which everything else is automatically deducted on a set schedule. There are costs to this system, but they are reasonable and involve the same fees that other businesses accept for the use of credit cards.

The most amazing aspect of this new practice has been the overwhelming acceptance by my patients; 95% of whom sign their billing agreement during their initial reading. I have had 1 patient out of about 750 who refused to sign the agreement and left my practice because I chose not to see her. I was the first physician to institute this policy in our group practice, and I saw the greatest amounts of negativity and resistence coming from the other physicians in the group. As more of my partners adopted this collection technique, they too have been impressed with patients' willingness to agree.

Currently, our collection process interfaces our billing company with a credit card/automated clearing house processor. We eventually would like to see our billing company become the source for card debits directly so as to avoid a middle layer. One improvement I would like to see in the system involves authorization of a card or checking account at the time of entry to verify adequacy of the account.

In the end, physicians are squeezed between lower reimbursements from managed care companies and increasing expenses for labor, rent, and supplies. We must be constantly searching for new business models that we can apply to medicine and thereby lower our costs of doing business. Like it or not, all of our practices are businesses, and we must treat them as such.

Robert B. Gore, M.D.

Englewood, Colo.

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