This not legal advice. Remember that. Ask your lawyer. The question of patients who pre-pay for the year always comes up. Here is a discussion:
- Lots of our patients want to prepay for the whole year. Another DPC doc and a former retailer I trust suggest we should be keeping that money in a small escrow account. Is anyone doing that? It seems simple but I’m not sure how to set that up with our billing
- I heard that some need to do that in some states for legal reasons, just to make sure the money is there if they choose to leave and need a refund. I have several patients who pay me annually. They do so in exchange for one free month per year. This is worth it to me, because I get paid up front and don’t have to harass people to get paid. I have not made the escrow account mainly because ain’t nobody got time for that, but also because I only have a handful of patients making the monthly payments and I know I have the money if I needed to repay them, and I’m an ask forgiveness not permission guy. You might check DPC Frontier and see if he has anything about that by state.
- I was told needs to stay in escrow too to avoid being tagged an insurance entity
- I have a token account labeled escrow to make sure I have something in savings, but I am not religious about making sure everything is in there. I would probably be screwed if everyone that paid annually quit at once.
- You just have to prove you have enough in the account to pay all those people back if they all of a sudden wants wanted to quit. Nothing fancy just keep some money in the bank.
- And a line item in your accounting. We just had this discussion with our attorney.
- I just talked to my attorney/CPA and he indicated that if you have a huge practice to consider it. But as most of us are small it is not likely needed at this time as long as cash is reasonable. That would really apply to a single huge lump sum individual payment. But as we have many patients paying annually at different times it is likely not needed.
- Wendy and I have a second acct at our bank that we use for quarterly or yearly payments. We just have it set up to auto transfer the $ into our primary acct the way it would otherwise come directly from our patients’ bank acct or credit card. It’s not a big deal to do, but it’s just one more administrative task. Now that we’ve been up and running a bit, I’m not convinced it’s really necessary. As others have said, it’s unlikely to have a large # leave at once and since the percentage paying monthly is close to 100% we should never have an issue