Patient collections run hand-in-hand with the consumer-driven healthcare model. A patient’s experience and their degree of engagement in the financial side of their care, will impact whether they complete payments. How are increasing premiums for patient health insurance affecting hospitals? What steps can be taken to improve revenue cycle processes to help hospitals increase profits?
“…patient payment estimation will be increasingly important this year and beyond as patients’ healthcare costs continue to rise.”
Navigational Tools to Evaluate Healthcare Costs are in Demand
It may come as no shock that a recent survey from TransUnion (TRU) demonstrated that 76 percent of consumers or approximately three out of four, report having concerns about the increasing costs of healthcare insurance deductibles and premiums. Key findings from this survey include:
- Almost two-thirds, 64 percent of consumers surveyed reported having greater concerns this year than the previous year about their total costs for healthcare procedures and services,
- This level of concern is greater than the 2015 TRU survey which found 58 percent of consumers were more concerned with the costs of healthcare services and procedures than in the previous year.
- More than half of the consumers surveyed, 57.9 percent, reported that their budget and families’ budget have already felt financial strain because of rising healthcare costs.
- Seven in 10 consumers, or 69.8 percent, stated if they would receive an estimate of healthcare costs before services or procedures, they would be able to anticipate and budget for these expenses more efficiently.
- Almost three in five, or 57 percent of the consumers surveyed states they would be more likely to return to a healthcare provider or hospital for services in the future if they had received pricing estimates during registration at point-of-service.
In regards to the findings in the survey, Gerry McCarthy, president of TransUnion Healthcare had this to say:
“Consumers are feeling an increased burden from the rising costs for their healthcare premiums, co-pays and deductibles and are paying closer attention to their total cost responsibility. When insurers share their 2017 rate proposals, consumers will not only be interested in the announcements, but also what they can do to alleviate the price shock. We’ve learned that the billing process impacts the overall patient experience and price transparency is critical to ensuring patient satisfaction.
Payment estimations can help patients budget, anticipate costs, and ultimately pay their bills on time or in full. We believe patient payment estimation will be increasingly important this year and beyond as patients’ healthcare costs continue to rise.”
The Reason More than Half of Hospital Bills Aren’t Getting Paid
Medical practices and hospitals are facing a critical financial challenge: patients aren’t paying their bills. Recently, an article covered this epidemic and pointed out the alarming fact that for every single dollar billed to a patient, hospitals have historically failed to collect 65 cents per dollar.
Why is this happening? Patients that share responsibility for the cost of their medical care are now responsible for a larger portion of the bill than the insurance policy covers much of the time. In the past, providers and hospitals used to collect approximately 90 percent of payment from insurers and the 10 percent owed by patients wasn’t very significant. Now, under these high deductible health plans, patients are often responsible for 30 percent or more of the entire cost of services. This shift in responsibility is causing financial stress on patients and hospital CEOs.
How Renovating Internal Revenue Processes can Increase Collections
The dynamic set of circumstances surrounding the issue of patient collections demands hospitals re-evaluate their internal revenue cycle processes and make changes in order to boost profit. Effective measures your hospital can take to boost revenue from patient collections include:
- Conduct risk cause analysis in your facility to identify and correct internal processes that create barriers to collecting payments.
- Encourage registration staff to make every effort to collect point-of-service POS payments. Provide more opportunities for the patient to pay and provide several acceptable payment methods, i.e credit or debit card, electronic check, money order, check, cash, etc..
- Engage the patient in the financial side of their care with one-on-one financial consultation. During this discussion, patient access staff provide with patients with pricing estimates and payment options, commitment to pay is established, and the initial payment for services is requested.
- Give patients a sense of empowerment by creating customized payment plans that are realistic and tailored to their ability to pay – while not making installments so low that the plan is stretched out over too much time.
- Encourage automated payment plans for patients that are paying in installments.
- Store securely and obtain the patient’s credit card, debit card, or automated clearinghouse (ACH) information and highly recommend automated payments that are convenient for the patient, and secure the hospital’s revenue.
- Reduce the costs associated with collecting patient payments. A great example of how to do this is by terminating paper billing statements and automate the process through email and promote payment upon scheduling.
While these measures may seem extensive, don’t let that stand in your way from making realistic changes one at a time.
The good news is… you don’t have to do this alone.
Your hospital can start seeing an increase in patient collections with the implementation of effective revenue cycle management (RCM) software. Modules that effectively improve collections processes include:
- Pricing estimation
- Payment processing
- Payment assessment
- Insurance eligibility verification
- Claim status
- Medicaid and charity assessment
- Authorization and precertification
- Medical necessity
- Insurance code solution
These systems can work together to improve hospital revenue processes or can be implemented and integrated individually, allowing you to choose the options that most benefit your facility.
At Revenue360, we believe in making the hospital financial process as simple as possible and easy on the registrar, especially considering the current environment of dynamic insurance changes and policies. Patient access staff already have enough challenges just to keep up on policies, let alone learn new software. This is why we built intelligent guidance into our software modules that work as a literal guide that provides on-screen prompts to walk the user through the process and cues the user to request collection of payment at certain points in the process. Request a demo today to see how powerful RCM technology can tighten the gaps to reduce revenue leakage.