New payment system helps doctors slash R200m off bad debt each year

Each year doctors lose around R500m to bad debt – it’s a significant contributor to doctors deciding to immigrate or to spend less time per patient – but cellphone payment solution, POCit claims they can cut those losses almost in half.

Doctors are reporting dramatic reductions in bad debt by using POCit.

“Last year patients spent R56.2 billion on private healthcare and medical aids are already promising steep increases for next year. Of the money spent on healthcare, R7,4bn is paid to doctors of which R5,9bn is paid by medical aids and about R1,5bn by patients,” David Reynders managing director of POCit said. “By cutting the amount of time doctors wait for payments once medical aids have disallowed all or part of the bill we could help ensure doctors don’t lose R200m of the annual R500m lost to bad debt each year.”

The R56.2 billion spent on private healthcare in 2007 was 9.6% higher than in 2006. Inflation and high interest rates are seeing steeper costs this year with some medical aids already announcing they will hike tariffs 12% in 2009. “There are four main reasons why POCit could slash almost R200m off that bill,” Reynders claims.

· Administrative costs in healthcare are a third of all costs.

· Medical practices using POCit report that they get paid within 24 hours or less.

· Sister company, Healthbridge, the leading payment interface between medical aids, hospitals and the medical profession already saves them half a billion rand a year by reducing payment times from 68 days to 12 days. “We wondered if we could better that and with POCit we have, those practices that are using it find that within 24 hours or less of billing patients by sms on POCit the vast majority pay up. Without Healthbridge healthcare inflation would have been 10.6%, a percent higher.

· It costs 30c to pay by POCit instead of a minimum of R3,50 by EFT, R12 from a teller or R5 from an ATM or by cheque.

“The convenience factor is much higher with POCit,” Reynders said, “according to the United Nations International Telecommunication Union 85% of South Africans use cellphones and one in three Africans across the continent. All cellphones with a colour screen – most of those sold after 2004, have web browsers and can use POCit.” However, at this stage POCit is using a combination of cellphone and internet technology to allow patients to pay their medical bills.

“From February 2009 patients will be able to pay their bills direct from their cellphone – the same way they can use POCit on their cellphones currently to pay anyone by knowing only their cell phone number,” says Reynders.

Tania du Plessis, a practice administrator for a Lynwood gynaecologist said previously it would take up to two months to get payment from patients after medical aid had reverted back to them and they’d reissued an invoice to patients and then waited. “Now we send an invoice to the patient by SMS on POCit. The patient can immediately see the account and why the medical aid did not pay, or how much they paid and what is owing.

“Most then pay us immediately by registering with POCit and paying by internet or they come into the practice. It has seen a dramatic improvement in cash flow and bad debt is far less frequent.”

Luis da Silva, managing director of Healthbridge which is the largest payment interface between the medical profession, hospitals and medical aids in South Africa said, “POCit is a cellphone payment solution designed by one of our sister companies and we began using it as an experiment to see if it could speed up payment. We are thrilled with the success of this product and how it is improving cash flow for medical practices and helping patients ensure they don’t incur bad debt. The less debt doctors carry the better the service that they can give to patients and the less likely they are to have sharp fee hikes.”

POCit is still extending their existing person to person cellphone payment platform to allow medical bill payments to be done directly from a patient’s cellphone which will further cut time, administrative costs and speed of payment while increasing security. “This extension will be complete by February next year,” Reynders said.

Lauren Human, an administrator for a busy general practitioner in Roodepoort said, “We find POCit very quick and easy. Patients prefer it because they can see the account on their phone or by logging into the website. It is quick for them to register with POCit, it’s absolutely secure and in most instances they pay immediately. It’s been important in preventing embarrassing and time consuming phone calls or mailing invoices again, we just enter their cellphone number and press send.”

Luis da Silva, managing director of Healthbridge says, “”We are eliminating administrative inefficiencies from health care: 30c of every rand spent in the health care sector goes into administration. We need to reduce those costs and we are very pleased that POCit is proving so successful at doing this.”

Reynders said, “In today’s difficult economic climate everyone is anxious about debt, we are pleased POCit helps people eliminate debt faster and more cost effectively.

“This system has only been available to medical practices for three months and is rapidly being adopted by them. We hope that as more doctors, hospitals and medical aids adopt POCit – as well as other companies across South Africa – we can be part of remedying today’s scary economic climate by keeping costs down and helping to create a catalyst for future growth and prosperity.”