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Should You Charge for No-Shows? (With Example Policies!)

With the busy lives that clients lead, there will inevitably be no-shows in any healthcare practice. No-shows occur when a client fails to attend a scheduled appointment without providing prior notice. Therefore, it’s crucial to consider this when planning your business model. They say that “time is money”, yet many practice owners fear that charging a fee for no-shows and late cancellations will drive away regular business.

According to a study published in the 2018 Journal of the American Medical Informatics Association, certain practices have seen no-show rates as high as 32%. Other practices reported a no-show rate of 13% – a significant number if you look at the cost implications of not charging for no-shows.

Another study by MGMA puts the number of no-shows between 5% and 8% of patients, still a substantial loss of income for your practice. In some cases, it might even be the difference between having a profitable month or one that goes into the red.

We’re here to guide you through the journey of deciding whether or not charging a fee for no-shows is right for you.

The Pros and Cons of Charging a No-Show Fee

Before we continue, let’s look at the pros and cons of charging for no-shows and late cancellations. These might help you make an informed decision.

Pros

  • You can cover the service, staff, rent and utility costs you have incurred during the appointment’s time slot.
  • A client’s failure to arrive negatively impacts the environment from a spatial and human-resource perspective.
  • Charging a no-show fee is standard practice across most industries, particularly in the medical sector.
  • Your own time and effort are financially compensated.
  • You’re not losing out on money you would have received from another client on the waiting list.
  • You’ll reinforce to clients the importance and value of your time. You’re helping them understand that your time and services cost money.
  • You may find that patients will be more diligent about sticking to an allotted appointment.
  • You’ll have clear and professional policies.

Cons

  • You may lose your regular appointment skippers.
  • You might find that some clients have genuine emergencies, and charging them a cancellation fee may add to their already bad day.
  • Some clients may have sudden financial issues and skipped their appointment as a result. While they should have called in advance, one never knows the whole story.

It’s clear from the significant number of pros in these lists that it’s likely wise to charge a no-show or late cancellation fee. But there may be some flexibility that you can offer – such as waiving the fee for first-time no-shows, or for a client who has a one-off issue.

Think about It, clients who fail to arrive at their appointments without warning give you no time to fill the allotted appointment with another client. During your busier times, you might have a waiting list of clients who are eager to see you. Therefore, it’s crucial that you implement policies that allow you to contact your waiting list to fill the appointment.

2 Things to Consider When it Comes to No-Shows

#1 Be Clear About Your Policies

First, set clear policies and stick to them. Then, make sure that you effectively communicate your policies with clients, who will, in turn, be aware of the consequence of missing their appointment.

Make sure that your policies are stated:

  • On all forms clients need to sign.
  • In all SMS & Email Communication sent out to your clients.
  • On signage displayed in your reception area or office.

By using multiple avenues of communication, you ensure that clients will be informed about the implications of missing their appointment.

#2 Find Ways to Reduce No-Shows

An excellent way to reduce no-shows and late cancellations is by sending clients reminders about their appointments. By doing so, you allow them to cancel in advance if needed. For example, you may send SMSes or emails – one 72 hours in advance and one a day before the scheduled appointment.

Online booking systems are a brilliant automated way to ensure that your clients are present for their appointments at the allotted time. By setting up an online practice management system such as Power Diary, patients can be sent automated reminders via SMS and email. This keeps upcoming appointments top of mind and, should they wish to cancel, they are reminded to do so in advance.

3 Different No-Show Policies to Consider

#1 Giving First Offenders a 2nd Chance

When considering that some clients may have a genuine emergency, you may want to offer the opportunity of a once-off, zero fee missed appointment for first-time offenders.

You can make this policy clear by using the following text on a sign, visible in your waiting room:

Practice Cancellation Policy

Dear Clients,

Please kindly provide 24 hours notice, should you no longer be available for your appointment.

If you cancel your appointment with 24 hours notice, you will not be charged.

Is it your first time?

We appreciate that sometimes emergencies happen. First-time no-shows and late cancellations will not be charged a fee. After that, you will be charged a 100% fee for appointments missed or cancelled without a 24-hour warning.

This helps us ensure that clients on the waiting list can make an appointment, and allows us to continue offering the highest levels of care.

Yours Sincerely,

The Practice Name Team

#2 100% No-Show Fee

This means that you’ll charge clients their full appointment fee, should they fail to arrive at their appointment without giving notice at least 24 hours in advance.

You can make this policy clear by using the following sign, visible in your waiting room:

Practice Name Cancellation Policy

Dear Clients,

Please note that you will be responsible for 100% of your appointment fee if you miss an appointment or cancel without 24 hours notice.

Please do your best to notify us in advance if you are unable to attend your appointment, and we will gladly find time to reschedule.

We appreciate your help in this matter; it helps us maintain high service levels at the practice.

Yours in quality healthcare,

The Practice Name Team

#3 50% No-Show Fee

If you’ve had a look at your finances and feel that you can meet the client halfway, you may decide to charge a 50% cancellation fee. This balances covering your interests and appearing empathetic to your clients’ needs.

You can make this policy clear by using the following sign, visible in your waiting room:

Practice Cancellation Policy

Dear Clients,

Please note that you will be charged 50% of the appointment fee if you fail to arrive for your appointment, or if you cancel without the required 24 hours advance notice.

Please do your best to notify us in advance if you cannot attend your appointment, and we will gladly find time to reschedule for you.

Yours sincerely,

The Practice Name Team

* * * * * * * * * * * * * * * * * * *

Whichever option works for you, be sure to make your policies clear so that clients are not stuck with an unexpected bill. Especially in these difficult financial times, it can be stressful for clients to have to pay money they haven’t budgeted.

Remember to spend time evaluating the costs of running your practice and looking at the importance of your time when deciding whether or not to charge a no-show or late cancellation fee.

Whatever you do, make sure that you look after the financial health of your practice, and don’t be afraid of offending your clients with clear, reasonable boundaries. Because, chances are, having clear, precise policies will not push away loyal clients, and you may even be able to shed some of your more demanding clients in the process.


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