You are an acupuncturist practicing in the United States. You treat patients who have suffered personal injuries. Consequently, you typically bill available "med pay" coverage and/or health insurance when available.
All too often, however, such insurance is nonexistent; if it does exist, it is woefully inadequate to cover the charges that would be incurred to provide patients with an acceptable level of care.
Your new patient is likely pursuing their personal injury case using the services of an attorney who customarily requests (and you customarily agree) to treat your patient on a lien basis. The coverage available, if any, will not pay for all of your services; they may in fact pay only a meager amount of the total charges. You have no option but to follow the typical approach and assure the attorney and patient that if they will sign a lien agreement (which they do), you will wait a reasonable time to be paid, which is usually defined as the conclusion of the case, (be it by settlement, arbitration or trial).
The Moment of Truth
The glorious day finally arrives, and the case has settled. This is a known fact, since the attorney's office has called to verify the outstanding balance. Your office knows from past experience that the phone call never comes until the case is on the verge of closure.
After months of office visits and thousands of dollars in unpaid bills, and after you have patiently waited over a year for payment, the attorney's paralegal calls and requests a one-third reduction in charges. Their explanation is that your charges (which, as far as you are concerned, are completely appropriate and in keeping with other acupuncturists in your area) are out of line according the insurance company, and have been reduced as a result of an insurance carrier's "peer review."
Alternatively, the attorney advises that the insurance company does not recognize this form of treatment and would not consider the charges or report you provided to support the patient's case. The paralegal further explains that the reduction is vitally necessary to net the patient any money at all after attorney's fees and costs.
Whether you, the acupuncturist, would agree to the reduction will be the subject of another column. The good news is that there may be another alternative, a possible escape from the oft-repeated unfortunate scenario described above. Imagine if you could accelerate payment to now, despite the abovementioned lien reference.
The New Lending Alternative
An exciting new concept has been taken to reality by a handful of lending institutions throughout the United States. Although for many years lenders have loaned money to individuals who receive "structured" lottery payments or structured long-term payouts from personal injury settlements, these innovative lenders have aggressively begun to loan money to accident victims before their cases have concluded. Although not inexpensive, these advances may provide salvation to a patient who is out of work, disabled and not creditworthy.
Most lenders require the attorney and their client to fill out an application form describing the nature of the case; expected monetary recovery; a discussion about liability; future medical care requirements; and other pertinent details. The attorney is not usually a guarantor but agrees to honor the lien in the same manner as they would an acupuncturist's lien. The advance is non-recourse, meaning that if the attorney loses the case, the client owes nothing.
What Does This Mean to You?
If enough time has passed to the point that you have tired of waiting until the case closes, or if you believe you have already honored your lien by waiting a reasonable time, there might be a way to accelerate your lien and be paid immediately. If you consider the reduction scenario, which occurs quite frequently in soft tissue injury cases, as loathsome and unfair, the solution would be to accelerate your lien and be paid at once. You could demand payment on your lien immediately. The likely result is that the attorney (and your patient) will both be unhappy.
If the patient, who is no doubt in dire need of funds, would borrow the money from one of the above-referenced lenders, he or she could receive some urgently needed dollars and perhaps allocate some of those dollars to paying down the current bill of their doctor, the one person who makes their life livable and takes away the pain.
The responsibility of determining that the advance agreement to your patient is fair and appropriate would fall on your patient's attorney. To accomplish representation properly, the attorney should carefully scrutinize all documents and properly explain their importance to the client. If such a loan is consummated and the patient and doctor receive funds in advance of the case's conclusion, the possibility of reduction is vastly minimized, since the bill will have already been paid or substantially reduced.
Research for this article has unearthed at least three companies actively making such advances. This article is not intended as an endorsement, only to advise you of this new and innovative lending alternative. As mentioned above, the job of assessing the advance and cost will be that of the attorney representing the client (your patient). While the underwriting as to a specific advance request is likely to be kept strict (clear liability cases only, perhaps), and while this means that only your patients with the clearest of cases may qualify, this approach may be another alternative for receiving payment for your services after health insurance and medical payment coverage have been exhausted as possible avenues for payment.
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