Advice for Long-Term Care Facilities: How to Maximize Profits and Lower Risk

on March 4, 2016 by John Tenaglia

In an industry undergoing significant change, Long-Term Care Facilities (LTCFs) need to rethink their approach to healthcare collection and reimbursement recovery. After years of representing nursing home clients, our law firm has developed a successful three-part strategy to help streamline the admissions process, implement policies to reduce outstanding private and Medicaid receivables, and recover money on a contingency fee basis. Below is an outline of some best practices to consider in evaluating how to reduce bad debt and expedite recoveries.

1. The First Line of Defense: The Admissions Process
Avoiding litigation starts with a strong admissions process. One simple precaution a LTCF can take is to develop an essential information checklist to ensure key pieces of information in the application are received prior to admission. Oftentimes, by the time a client has contacted our office to assist in recovery of a delinquent or Medicaid-pending account, we are hampered in our ability to assist due to faulty or lacking information gathered in the admissions process. Further, minor adjustments in the admissions agreements in areas such as clarifying the obligations of a power of attorney and ensuring that legal fees and collection costs are recoverable, can ensure a more positive result once litigation has started.

2. Prepare to Protect: Delinquency Identification & Documentation
Managing delinquent or “problem accounts” requires a focus on the three “P”s: Process, Platform, and People. LTCFs should develop or revise their policies and procedures to focus on how accounts are identified as being at risk of becoming delinquent. Even the simple act of keeping detailed notes regarding the times, dates, names, and contact information of everyone spoken with while attempting to get a past due account paid is critical in later developing a strategy to receive payment. A system that retains documents and tracks notes on each account leads to a greater likelihood of success in expediting the Medicaid approval process and recovering outstanding balances. Clients that have developed a strategy around this process have seen a significant increase in revenue.

3. Getting Paid: Leveraging the Legal Process

LTCFs should also have a strategy for escalating accounts to a law firm. In most cases, a law firm’s ability to assist in asset recovery is tied to how quickly an account is placed with the firm. Nothing drives down the rate of recovery more than a delay in time. Upon receipt of a case, an experienced attorney will evaluate all of the evidence and recommend the most effective legal solution. In some instances, an emergent action in Chancery or Surrogate court to obtain a pre-judgment lien on a home, or to intervene in an attempt to wrongfully transfer assets is required to preserve a client’s right to payment. A knowledgeable attorney will help you implement and execute a cost-effective legal strategy, which may include resolving the account amicably through simple debt collection letters, or through a traditional lawsuit.

About Tenaglia & Hunt
Since 1976, Tenaglia & Hunt has specialized in debt collection. Through our offices in New York City, New Jersey and Delaware, our law firm represents healthcare providers, including hospitals, regional healthcare companies, long-term care facilities and assisted living facilities in the management and recovery of their receivables. The Firm and its attorneys have an excellent reputation for professionalism, client service and results.