The past few years have demonstrated that outsourcing all or portions of the revenue cycle is an effective strategy to mitigate costs and improve results. According to one report, revenue cycle functions account for the largest segment (27%) of outsourcing at hospitals and health systems.[1]

Patient account resolution is one area where outsourcing can make a big difference. Self-pay is becoming a larger percentage of the payer mix as patients are taking on a growing amount of medical debt. At the same time, 59% of providers assessed patient financial literacy as poor.[2] That may help explain why nearly 70% of providers cited excellent customer service as one of their top three priorities for outsourcing patient payment solutions.

How does medical debt factor into the equation?

Medical debt in the U.S. is currently estimated at $140 billion, with more than 100 million adults carrying some level of debt.[3],[4] Over half of patients with medical debt owe more than $1,000, and more than 15% have debt in collections.[5],[6] And 73% of patients with medical debt owe some or all of it to hospitals.[7]

Besides impacting the bottom line, outstanding medical debt can cause patients to skip or delay care. When this happens, conditions can worsen and eventually cost the patient and the hospital more through avoidable ER visits and hospitalizations. According to the Kaiser Family Foundation, nearly two-thirds of patients surveyed say they or a family member have put off needed medical care due to unpaid medical bills.[8]

What can hospitals do?

One of the most effective approaches to improving self-pay collections is to provide a better patient financial experience that makes it easier for them to pay. Outsourcing can help hospitals and health systems do just that. Providers must carefully vet the vendors they are considering ensuring optimal return on investment in these relationships. The following are five key elements to look for.

Patient-centric customer service representatives

Every financial engagement has the potential to impact your bottom line and your hospital’s brand reputation—for the better or the worse. Aggressive collection agents can make hospitals appear as adversaries, not advocates, in their patients’ healthcare journey—even if the clinical experience was positive. It cannot be overstated how important it is to ensure the outsourcer you choose acts as an extension of your billing team, treating your patients with respect and dignity. The best partners will employ patient satisfaction surveys to track their effectiveness and quality encounters.

On this note, providers should ask potential vendors about their approach to training. Soft skills like active listening and compassionate communication are vital. KPIs and regular call monitoring should be used to measure quality encounters and to hold agents accountable. The best partners will also use incentives to reward top-performing agents who deliver positive patient interactions.

Patient financial responsibility estimations

Hospitals and health systems should choose a partner that leverages patient-centric technology to improve the patient experience. Patient responsibility estimation technology is a great example. This technology generates detail about patient co-pays, coverage information, and remaining deductibles. This includes the patient’s financial responsibility for the service. When patients know what they owe up front, they can make more informed decisions about their healthcare and providers can be more proactive in collecting earlier in the revenue cycle. Sharing these estimates helps patients understand that their responsibility is set by the payer and the type of plan they chose, not the provider. This can help enhance trust and the patient-provider relationship.

Propensity-to-pay analytics

Sending multiple statements and then turning the account over to collections is an ineffective and costly process, especially when used on patients who are genuinely unable to pay. Propensity-to-pay analytics helps identify each patient’s unique financial situation using intelligent scoring and demographics, not just a credit report. This helps identify which patients may be eligible for charity care or financial assistance. Patients appreciate their provider’s willingness to help them pay for the care they need, and providers are less likely to write off balances unnecessarily.

Flexible payment plans

Each patient has a unique financial situation, one that changes over time. Changes in employment status, unexpected debt, and changes in family situations can affect a patient’s ability to pay at any given time. Trying to fit all patients into a one-size-fits-all collections process doesn’t return optimal results. The best collections partners are those that can customize payment plans for each patient’s specific financial situation. The plans should be flexible enough to add future balances, as well as balances from other family members. These types of patient-centric plans improve collections while also enhancing the patient financial experience.

Multiple payment options

Just as each patient’s financial situation is different, how they prefer to pay varies as well. Providers should choose a partner that allows for these preferences by offering a variety of payment methods to make it easier for patients to pay. These methods should include digital payments on mobile devices, online payment portals, automated voice activation systems, and payments by mail or in person.

Providers must also look for a partner that provides clear, concise statements that are easy for patients to understand. When patients can easily locate the charges and identify the reason for the charges, the statement is less likely to be ignored.

Patients at the center

Prioritizing the patient financial experience starts with a patient centric focus.  To achieve the greatest return on investment for the relationship, providers should choose a partner that understands the importance of the patient experience and that leverages the tools, the technologies, and the professionals necessary to ensure optimal results.

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[7] Ibid.


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