Avoid Bad Debt: Advice to LNCs and Experts

Every business has a small amount of billing that cannot be collected on or bad debt. Your LNC company may work very hard to ensure that you collect every dollar we were owed. Out of the hundreds of cases that you handle, a few result in bad debt.

1. Missed deadline
Here’s what can happen. Suppose an expert was asked to provide an opinion on behalf of a plaintiff attorney. A specific date was communicated to the expert as the due date. The expert missed the deadline. Although she found that the nurses were not negligent, and that there was no basis for proceeding with the claim, the attorney focused on the fact that the expert missed the due date. The invoice was not paid.

Don’t let this happen to you! Lessons learned:
o Be very clear about a deadline for your opinion.
o Keep the deadline.

2. Poor report causes bad debt
The vast majority of experts have acceptable report writing skills. When attorneys complain about reports, it is often because the report was not well-written. The expert may have:

o poor English skills, resulting in a report filled with grammatical errors
o filled the report with unnecessary information, such as a detailed chronology or deviations from the standard of care that had no impact on the case
o not followed the correct format for a report

Here is what could happen. An expert spent excessive time reviewing the material, did not follow the report format, and missed the deadline for submission of the report. The attorney and the LNC company ended up spending extensive time with the expert to rework the report.

As a result, the attorney lost confidence in the skills of the expert. He settled the case for a fraction of what he thought it was worth before the opposing side could ask for the expert’s deposition because he was fearful that the expert would come across poorly at deposition. The LNC company had to accept bad debt and write off a portion of the invoice in order to obtain partial payment for services provided by the expert.

Don’t let this happen to you! Lessons learned:
o Recognize that there is a learning curve associated with this role. The inexperienced LNC or expert may need to be flexible in not billing for every minute spent reviewing materials.
o Follow the format for reports your client wants or are standard in our industry.
o Meet deadlines.

3. Credibility destroyed at deposition
Once an opinion is formed and a report is prepared, the expert is expected to stand by the report. The expert’s opinion will be challenged during a deposition or during cross-examination. The pre-deposition or pretrial preparation with the retaining counsel is the opportunity for the expert and attorney to anticipate the lines of attack. Define how to provide effective rebuttal.

Here is what could happen. When the expert does not do well in a deposition, the LNC company and the expert may not receive compensation for money owed to an expert as a result of work leading up to and including the deposition.

Following the deposition, the attorney called the LNC company to discuss the deposition and the fact that she could no longer use this expert on the case because his credibility and usefulness had been destroyed.

The expert had an unpaid invoice before the deposition began. The attorney took the position that she could not ask the insurance carrier to pay the expert’s outstanding invoices for review of records before the deposition, as well as for the deposition preparation. Although the LNC company may argue that payment for services was not contingent on performance, the poor performance of the expert makes it impossible to collect anything that was owed. The net result is lost income, bad debt and a lost client.

Don’t let this happen to you! Lessons learned:
o If you are an expert, as you prepare for the deposition, try to anticipate how the opposing attorney will attempt to make points during the deposition. Be thoroughly familiar with the opposing expert’s report. If it has not been supplied to you, ask your retaining attorney if a report has been prepared by opposing counsel’s expert.
o Take full advantage of your right as an expert to meet with the attorney before the deposition. Go over the expected line of attack, and how to most effectively respond. Expect to have one hour with the retaining counsel.
o Adhere to the advice of your retaining counsel, and use the strategies worked out in the preparation for the deposition.
o If you feel that you are getting rattled, ask for a break. You may not speak with your retaining counsel during the break, but you can use the break to regain your composure.

4. Inadequate preparation for trial
With only 5 percent of all medical malpractice cases going to trial these days, it is rare for an expert to have to testify. When you do have to testify, you must be prepared.

Here is what happened. The expert was absorbed in personal problems. He did not know his report, which forced the attorney to have to ask the expert to refer to specific passages in order to answer her questions. Even though the expert was an excellent clinician and knew how to communicate well, these skills were not evident in the courtroom when it counted. The attorney lost the case and blamed the expert for at least a portion of the outcome. She refused to pay the full invoice. The expert had to write a portion off and accept bad debt.

This situation represents a difficult collection issue. Always insist on payment before the expert goes to trial.

I had a bad experience years ago as an expert. The attorney hired me to testify at a deposition and trial. I billed for her deposition time and had not been paid before I was notified the trial was scheduled. I testified at trial. The attorney lost the case and his client refused to pay my bills, saying the attorney did not handle the case well. I had my attorney write a letter to the attorney, and I collected what was owed, minus the fee for my attorney.

As a result of this experience, I recommend that an expert not go to court unless all bills are paid in full, and the estimated bill for trial preparation and testimony has also been paid.

Don’t let this happen to you! Lessons learned:
o As a professional, you are expected to be able to rise above personal problems. Once you accept the role of expert witness, it is very difficult and often impossible to withdraw from a case.
o Thoroughly know your report and materials. Your credibility hinges on smoothly delivering your opinions in a way that educates the jury and persuades them of your expertise.
o Obtain prepayment before a trial.

Pat Iyer MSN RN LNCC believes that clear communication and great preparation and performance avoid much of the possibility for bad debt.