The Contract Billing feature allows you to create billing contracts or payment plans for patients. The contract billing workflow involves the following steps:
- Create a Treatment Plan
- Create the Billing Contract
- Add an Initial Payment
- Account Settings for Contracts
- Enter the Charges
- Bill the Patient
As Contract Billing can be a complicated subject, we advise that you contact MacPractice Support to evaluate whether Contract Billing is a good solution for payment plans for your accounts, and to walk you through the intricacies of the feature.
The alternative to using contract billing is to set up installment amounts on statements.
Create a Treatment Plan to determine the amount and length of the contract. You may decide to not use treatment plans, however it is highly recommended to assist with planning accurate amounts in the Billing Contract.
If you use Insurance Estimating, estimate charges and confirm the estimates are accurate. The original treatment plan estimates will affect how the contract charges are adjusted.
If you are including insurance information on your Billing Contract, you must first contact insurance or file a predetermination claim to verify details.
Create a new billing contract in the patient's Ledger from the Incident menu. Choose New Billing Contract or use the Command-Shift-C keyboard shortcut. In the resulting Billing Contract window, enter data within the required fields, Description, Total Amount, and First Payment Date. Additional options are provided to further modify the contract based on amounts, terms, conditions, and so on.
As the Billing Contract is planned, the table will display the terms and amounts. When the Billing Contract fields are updated, click the Calculate Payment Schedule button to recalculate the table with the new variables.
Theses fields are necessary to calculate and save a Billing Contract.
- Description: This field names the contract as it will display in the incident sidebar.
- Total Amount: This field is the total cost of the contracted services as determined by the Treatment Plan. The Total Amount should not include any amounts for which the patient is not responsible. Insurance portions can be added with the Insurance options (see below).
- First Payment Date: This field is the future date on which the first installment payment is due. Today's date is not a valid entry. To enter a payment for today's date, use the Initial Fee field (see below).
These fields, menus, buttons, and checkboxes are optional, however they may be necessary to complete the Billing Contract as agreed upon with the patient. The additional options adjust the amount, attribution, terms, and conditions associated with the Billing Contact.
- Discount: This field applies a dollar amount discount, if applicable.
- Adjusted Total: The Adjusted Total is the Total Amount minus the Discount. The amount will automatically adjust as the Billing Contract is calculated.
- Initial Fee: The Initial Fee field is used to calculate the contract including the patient's down payment. Adding an Initial Fee amount activates the Make Initial Payment After Activation checkbox to the bottom right of the sheet. Select the box if the patient is making the payment today, and a payment window will present after the contract has been saved.
- Split Initial Fee: This button splits the Initial Fee into up to 3 installments.
- Scheduled Total: The Scheduled Total is the Adjusted Total minus the Initial Fee. The amount will automatically adjust as the Billing Contract is calculated.
The Attribution options define the contract payment recipients for reporting purposes.
- Provider: Select the Provider associated with the contract. The patient's provider will be set by default.
- Office: Select the Office associated with the contract. The patient's office will be set by default.
The variable options define the division of payments throughout the contract.
- Frequency: Set the frequency of the patient's payment to monthly, weekly, or every two weeks to establish the rate at which payments will occur.
- Each Payment Amount or Number of Payments: Select one of these options to establish whether payments are calculated by a set number of payments or amount. Each Payment Amount will calculate the payment schedule based on a specific amount, whereas Number of Payments will calculate the schedule based on a set number of payments.
- Always Skip Month: Select this checkbox to avoid charging contract fees within a given month. Enter the number that corresponds to that month. For example, to skip contract charges in December enter 12 in the field.
Late Fee Conditions
The Late Fee condition options define how and when a late fee will be added to the contract.
- Charge Late Fee: Select this checkbox to configure the contract to charge late fees.
- Grace Period: Set the number of days within the due date the patient must pay to avoid a late fee.
- Late Fee Amount: The amount to be charged after the Grace Period.
The Insurance options modify the billing contract based on expected Insurance contributions.
- Accept Assignment: Select this checkbox to accept assignment on charges related to the plan listed above the box.
- Expected Insurance: Set the dollar amount expected by Insurance.
- Percent Coverage: Set the percentage of coverage expected by Insurance.
- Calculated Insurance: This is the total amount of expected insurance contribution. The amount will automatically adjust as the Billing Contract is calculated.
Recurring Contract Charges
The Recurring Contract Charges options allow the monthly contract items to be posted as Procedure Codes for internal tracking or to assist in reporting payments applied to the contract charges using the Earned Receipts report.
- Fee Schedule: Select the Fee Schedule from which the procedure codes should be posted.
- Code: Set or Select a specific code which should be posted for the monthly charges. You can create claims and post charges to the contract charge, as you would a normal charge, however it cannot be deleted.
- Report Recurring Charges As Production: Select this checkbox to add these charges to your Production totals. Set this checkbox to be automatically checked for all billing contracts in Preferences > Contract Billing.
Click Activate to finish and save this payment plan.
If you selected the Make Down payment After Activation checkbox, you will be prompted to enter the patient's down payment within the resulting payment window. Continue to Add an Initial Payment.
If no down payment is to be added, set the patient settings so that there is no interference with future statements or installment amounts. Continue to Account Settings for Contracts.
The Contract Charge will display in the payment window. Enter the Initial Fee amount in the Payment column. Apply the amount to only the contract charge, then click the Save button.
Upon saving the payment, the billing contract and the initial contract charge display in the patient's ledger. The patient balance does not initially reflect the entire contract amount, however it will be added to the patient's balance at the rate of the charge frequency.
After the down payment is added, set the patient settings so that there is no interference with future statements or installment amounts. Continue to Account Settings for Contracts.
The patient will have a line item in the Transactions area of the incident showing the description and total amount of the contract. The patient's Ledger will display a contract with scheduled charges and any initial down payment. A series of pending treatments will also display in the Treatment Plan.
Set the patient's statement settings in the Account tab. Contract charges will be assessed automatically, even if you do not create statements for your patients. Send statements either by printing them manually in each individual patient's ledger, or by using the Statement Manager. If you wish to bill all contract patients in the same batch, set these accounts with a specific Financial Status on the patients' Account tab.
The Installment Amount field on the patient's Account tab should be left empty, as this field is designed to be used with a different feature and may cause your patient's statements to show an incorrect balance. If you send statements through the Statements Manager, confirm the Statement Option menu in the Account tab is set to Send Monthly Statement.
Next, Print or Edit the Billing Contract.
The Contract Billing feature uses negative adjustments to avoid double-charging the patient for the original procedure charges and the separate procedure within the contract charge. Always select the Charge via Contract checkbox when posting a procedure to the contract so that the negative adjustment is automatically applied. If Charge via Contract is not selected when charges are entered, or if the negative adjustment on the procedure is deleted, the patient will be charged twice for the same procedure.
Post procedures that are not part of the patient's contract to a separate incident and make sure the Charge via Contract checkbox is not selected for any charges that are not a part of the contract. For more information on creating and using incidents, click here.
As contract procedures are performed, move the charges from the Treatment Plan to the Transactions area of the Ledger. Select the charges, then select Move to Transactions within the Treatment menu. Always select the Charge via Contract checkbox in the New Charge window when posting a procedure to the contract.
New procedures can be added directly to the patient's ledger, if necessary. Always select the Charge via Contract checkbox for each procedure.
When a procedure is posted with Charge via Contract selected, a negative adjustment will be automatically applied toward the charge. The amount of the negative adjustment will vary, depending on whether you use Insurance Estimating or not.
Without insurance estimating, a negative adjustment is posted for the entire amount of the procedure listed in the New Charge window. If the patient has insurance coverage, create the insurance claim. The negative adjustment will not affect your insurance claim and the charge amount will display as it normally would.
Always leave the negative adjustment applied to the charge until insurance payments are received. You may delete the applied negative adjustment when entering the Insurance payment, however you must add a negative adjustment back onto the charge for the remainder of the unpaid portion or your patient will be charged twice.
If you are using Insurance Estimating, a negative adjustment will be posted for the amount of the patient portion of the charge only. Create the claim. The insurance amount will remain until the insurance payment is received and posted.
If the insurance pays less than the estimated amount, decide if the patient should pay the amount through the contract or separately. If the patient will pay for it with the contract, enter a new negative adjustment for the remainder. Otherwise, leave the charge as it is, and it will appear as a patient responsible amount on a statement to be paid with future patient payments.
Continue posting charges until your patient has had all contracted procedures performed.
Whether you have finished entering all procedures or not, MacPractice will begin charging your patient automatically according to your contract schedule. Charges will be assessed automatically provided that the MacPractice Server is running when the day changes over to a due date. If the MacPractice Server is not running during this transition, charges will not be assessed until the next date change.
MacPractice recommends sending your patient a statement each time a new contract charge is assessed, especially if your contract includes late charges. If you set your payment plan to charge the patient weekly, you should print statements weekly. MacPractice recommends using the Statement Manager to generate statements for patients with contract charges. If you wish to bill all contract patients in the same batch, you should set up these accounts with a Financial Status on the patients' Account tab.
As you receive payment from your patients, you can then apply the patient payments to the contract charges accordingly.
If the patient pays early on any charges, you can also force them to post so you can apply the payment. Click the Post Charge button from the payment plan window, and the charge will be posted to the patient's account early.
Return to the Transactions list and you will see a new Contract Charge posted to the patient's account. Enter a ;patient payment as you normally would, by clicking on the Payment menu and selecting the type of payment you wish to enter.Make sure you apply the patient's payment to his or her contract charge and save.
In order to print your billing contract, you will need to activate the Contract Billing Agreement form in References > Forms.
Once this form is active, you can select your contract from the ledger choose Print > Print Contract Billing and you will be able to print appropriately.
Once you begin using payment plans, you can also begin running reports based on the expected revenue you should receive from these payment plans.
Under the Monthly node of the Reports, you will see an Expected Revenue by Month report. This report will show you income you should expect to receive from your current payment plans. As with most items in reports in MacPractice, this can be filtered by provider and office. For this report, it filters by the provider and office listed in the payment plan. Select your filters, then click Apply to view the results.
- Month: The report will list each month in which a contract charge is due in the Month column.
- Expected Revenue: The Expected Revenue column displays the amount of contract charges with a Due Date in the selected month. Charges will be counted in this total even if they have already been paid.
- % Total Expected Revenue: This column lists the percentage of all expected revenue that is due in the selected month.
You can click the triangle next to any month to see the patients with contract charges due that month.
- Patient: The Patient column lists the name of the patient with the contract.
- Contract Billing: This column lists the name of the billing contract record.
- Provider: ;The Provider column lists the user ID and office ID of the provider and office associated to the payment plan.
- Total Pending Charges: This column lists the total amount of charges due in the selected month.
- # Pending Charges: This column lists the number of charges due in the selected month as a part of the patient's payment plan.
You can click the triangle next to the patient's name for more detail on their contract.
- Term: Lists the term number of the charge. For example, a D represents a down payment, 1 represents the first charge in the contract, 2 the second, and so on.
- Amount: Amount due on the selected term.
- Due Date: Date the contract charge will post to the patient's ledger and payment is due.
You can sort the report by any column by clicking on the column header. Click once to sort ascending (A-Z, 1-9, or most recent activity to latest), and click again to reverse the sort.