To charge or not to charge? Which is right for you?
Lucrative case prompts credit card option
To succeed in the competitive private duty industry, agencies must remain sensitive to their clients’ needs. One agency, therefore, saw the writing on the wall when a family member with the power of attorney over a 24-hour private pay nursing case asked if he could pay by credit card.
VNA of Louisville (KY) did not offer that option, but Sylvia Villegas, RN, CCM, executive manager of private duty services, knew what she had to do. "If we couldn’t respond, a competitor would be more than happy to in order to snag the case, and we didn’t want to lose it," she says.
Agency staff called local banks and asked about the procedure and cost of setting up a credit charge at a remote site. The agency negotiated payment rates and finally settled on a rate of 5%. Some credit companies add a surcharge if the card is not present to be swiped through the machine when the charge is made, as in the example of a phone charge.
The agency also had to buy a machine to capture the credit card information and a modem so the information can be transmitted to the bank.
Once the initial inquiry was made, the agency had the credit card authorization system up and running in about 10 days. Now every two weeks, a VNA employee calls that family member of the 24-hour case and informs him of the charges for that period.
The agency had not previously initiated the payment option because money had to be paid to the bank for each credit card charge. "It cuts into your margin, of course, but some margin is better than no margin," says Villegas. "When the inquiry came from this case, there was nothing to think about.
"From a sales point of view, this was an obvious value added’ option for clients," she says.
At this point, the credit card option is reserved only for that 24-hour client. Villegas says VNA of Louisville does not advertise nor promote this payment option because of the agency’s margin reduction. She can think of another scenario, though, in which a credit card payment might make sense to the agency. "When you have a lagging payer and services are discharged, there is not much impetus to pay. If the balance is substantial, we could offer credit card payment as an option to settle the balance and avert sending the payer off to a collection agency and possibly damaging [his or her] credit status."
Once the credit card option has been offered, clients can decide how to handle the bill. "Maybe they would want to make monthly payments until the balance is paid off," Villegas explains. "A lot of times it’s just a convenience for people. [With payments], they wouldn’t have to look at a $2,000 problem. They could look at a $30-a-month problem."
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