Uncompensated care and growing patient financial responsibility are taking a toll on the bottom line of hospitals and providers across the country.[1] According to the American Hospital Association, uncompensated care reached $38.4 billion in 2017, more than doubling since 1995.[2] Add to that the $7.5 billion in patients payments that go uncollected each year and the picture becomes even more disconcerting.
But the challenge isn’t just for providers. Patients are struggling too. Medical debt and medical-related expenses are responsible for 67% of all bankruptcies in the US.[3] Trying to collect from patients who are already struggling to pay their bills can be an exercise in futility if not approached in the right way.
Fortunately, there is a way to help both patients get and pay for the care they need while protecting—and improving—your bottom line.
Many hospitals have come to realize they simply don’t have the internal resources or expertise needed to optimize their collection processes. Outsourcing to revenue cycle experts is a great way to see fast improvements. But getting a positive return on that outsourcing investment can be tricky. Hospitals and providers need to ensure they’re choosing a vendor with proven success. The following are four considerations to keep in mind when looking for a partner.
Patient-centric customer service representatives
Every financial engagement matters—to both your bottom line and your hospital’s reputation. Aggressive collections practices can negatively influence patient satisfaction even when the clinical experience was positive. While laws exist that prohibit collectors from harassing patients, the tone of an agent can sound harassing even if it doesn’t meet the legal definition.[4] According to Leonardo Cuello, director of health policy at the National Health Law Program, “The actual debt collector problem is often about the lack of accountability that providers have for the people that they pass their debt along to.”[5]
It is important that the partner you choose acts as an extension of your organization’s team and is committed to service. They should understand and embrace your hospital’s patient-centric culture. Ask the vendor how they hire and train their teams – representatives with strong empathy and a drive to deliver a positive experience is key. Do they regularly monitor calls to ensure quality and best practices are being met, holding representatives accountable for delivering quality? Ask about how they recognize and reward agents, as high-pressure collections with incentives can create a poor experience for your patients.
Patient-centric technology
Typical revenue cycle technologies and processes were designed around payer reimbursement, not patient payments. Now that an estimated 35% of provider revenue comes from patients, collecting those payments is essential for achieving long-term financial viability.[6] And that requires different technology and different processes. The best partners will offer technology that integrates seamlessly with your EHR and other revenue cycle systems. Look for the following technologies and capabilities:
- Patient responsibility estimation. This technology informs patients of their remaining deductibles and costs, as well as provides an estimate of their financial responsibility prior to service. When patients know what they owe up front, they can make more informed decisions about their healthcare and providers can be more proactive and collect earlier in the revenue cycle. Sharing these estimates with patients helps them see that their responsibility is set by the payer and the type of plan they chose, not the provider. This can help position the provider as an advocate instead of an adversary, which improves the patient experience and loyalty.
- Propensity to pay analytics. Sending statement after statement, then turning the account over to collections, is an ineffective and costly process for collecting from patients who are truly 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 financial assistance. Patients appreciate that their provider is willing to help them pay for the care they need. And providers are less likely to write off balances unnecessarily.
Patient-centric payment plans
Each patient has a different financial story, 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 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 unique financial situation. The plans should be flexible enough so additional balances can be added over time, keeping payments manageable. These types of patient-centric plans improve the likelihood providers will get paid while also enhancing the patient financial experience.
Patient-centric payment options
Just as each patient’s financial situation is different, how they prefer to pay varies as well. The best partners allow for these preferences by offering a variety of payment methods to make it easier for patients to pay. These methods include digital payments on mobile devices, online payment portals, and voice portals, as well as payments by mail or in person. Look for a partner that also provides clear, concise statements that are easy for patients to understand. When patients can easily identify the charges, what the charges are for, and what they owe, the statement is less likely to be ignored. That means the bill is more likely to get paid.
A new approach to the patient financial experience
Self-pay outsourcing partners play a vital role in helping hospitals and providers maximize revenue while enhancing the patient financial experience. Choosing the right partner is essential to achieving an optimal return on your outsourcing investment. The best partners drive industry best practices while taking a patient-centric approach in everything they do. These partners not only help improve your bottom line, they also promote your brand and secure a competitive edge.
[1] https://www.globenewswire.com/news-release/2018/06/26/1529420/0/en/Patient-Balances-After-Insurance-Continue-to-Increase-in-2018-Driving-Bad-Debt-and-Uncompensated-Care.html
[2] https://www.aha.org/system/files/2019-01/uncompensated-care-fact-sheet-jan-2019.pdf
[3] https://ajph.aphapublications.org/doi/10.2105/AJPH.2018.304901
[4] https://www.consumerfinance.gov/ask-cfpb/are-there-laws-that-limit-what-debt-collectors-can-say-or-do-en-329/
[5] https://www.npr.org/sections/health-shots/2019/05/29/727596397/mired-in-medical-debt-federal-rule-changes-proposed-for-bill-collectors
[6] https://www.forbes.com/sites/allbusiness/2017/06/28/what-we-can-all-do-about-rising-healthcare-costs/#11413a32f375
