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How to Implement a Cancellation Policy

October 9, 2018 | Article | By: Sara Hodgins

When running your practice, it can be daunting to decide how to implement a cancellation policy. Cancellation policies can be seen by patients as a money-grab for a missed appointment, leaving them bitter about the charge, or they can refuse to pay, leaving a small balance that you then have to decide whether or not to send for claims collection.

The good news is that cancellation policies don’t have to carry such a negative overtone! A successful cancellation policy acts as a deterrent and not as a punishment for patients and can significantly reduce your no-show and late cancellation rates! Here are six things to keep in mind when implementing your cancellation policy:

Clearly define your cancellation time frame.

The goal of having a cancellation policy is to allow enough time to be able to book another patient into that cancelled spot, so be precise with your wording to ensure that both staff and patients have a full understanding. For example, saying that you require “24 hours’ notice” for the cancellation can be confusing. If a patient lets you know that they are cancelling their Tuesday 8:00 am appointment at 10:00 am on Monday, that’s not within your 24-hour requirement, but are you going to charge them? Or, if your clinic is closed on Sundays, and the patient notifies you on Sunday at 9:00 am about cancelling their Monday morning 10:00 am appointment, that doesn’t give you enough time to book a patient in the now empty time slot even though it is 24 hours’ notice. Instead, try having a cancellation cut-off period – for example, 3:00 pm the day before the appointment. If you are closed on the weekends, specifically write in your cancellation policy that you require notice for a cancelled Monday appointment on Friday. Or you could always opt for a seven-day-a-week call answering service that can cancel and book appointments right into your schedule so that you don’t need to worry about even mentioning anything different for the weekends!

Set your cancellation rate

Some people opt to charge the patient for the full amount of the missed appointment. However, legal advisor Dr. Dubé-Barile recommends charging a reasonable amount that reflects the costs incurred from the missed appointment, and not the full amount. If your one-hour massage does not show up for their appointment, you are losing out on the hour massage, but you can fill at least some of that time with other things, such as marketing for your clinic, catching up with paperwork and patient notes, or laundry and additional cleaning around the clinic that you would have stayed late to do, so do not need to charge the full amount. $25.00 is a fairly standard cancellation rate, but you can decide whether or not that is appropriate for your clinic.

Have patients sign the cancellation policy.

When a new patient starts attending your clinic, they have to fill out intake paperwork, so that is a good place to include your cancellation policy. Review it with them to ensure that they understand it. If you are just implementing a cancellation policy now, be sure to review it with all of your existing patients and have them sign it as well. A signed cancellation policy is a contract between your patient and your clinic and is necessary to enforce the policy legally.

Communicate your cancellation policy to patients

We’ve already established that every patient should review and sign the cancellation policy when they are starting at the clinic, but you should also communicate it to your patients in other ways. I’m not talking big bold signs posted in several places in the clinic, because that just looks tacky and rude, but a nicely printed and framed sign at the front desk is okay. Also, when a patient calls to cancel their appointment inside the late cancellation timeframe, remind them about the cancellation fee. Many patients will decide to come in rather than pay the fee once they are reminded about it! If you have a website, including your cancellation policy, there is also a good idea.

Define when you want to waive the fee

Waiving the cancellation fee should be done sparingly as consistency is key when implementing a cancellation policy. If you waive the cancellation fee for every other patient, there is no point in having a policy at all! When to waive the fee is something that should be communicated only to your staff, and not your patients, otherwise every patient will have a reason that is ‘waive-able’ when they call to cancel! Perhaps you want to let all of your first time late cancellation/no-show patients off with a warning that next time they will be charged, or waive the fee if there was an emergency or family crisis. You may also want to treat some patients differently depending on their situation, for example, the elderly patient with dementia or the young couple pregnant and due any day now. Whatever your policy is, ensure that your staff understand it, so there is consistency with the cancellation policy.

Help your patients remember when their appointment is

You can’t take responsibility for having a patient come in for their appointment, but you can certainly help them to remember! Offer patient reminders in the form of an email or text the day before their appointment. Most scheduling software’s, including yours truly InnoCare Software, can automatically send out customized reminders to patients. For first time patients, you may even want to call them to remind them about their assessment.

So, is it time to implement a cancellation policy and start getting your no-show rate under control? Or perhaps revamp your current cancellation policy so that it is actually followed? Click here to access our free template! We recommend putting it onto your own letterhead or even adding it to the bottom of your patient consent form.