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3 Strategies to Deliver Better Patient-Centered Financial Experiences

There’s a growing trend affecting patients in the U.S. today: delaying or avoiding care because of concerns about costs. High out-of-pocket costs are restraining access to care for many. Even when patients have access and decide to get care, the costs and the financial experience result in even more stress.

Today’s healthcare consumers are also increasingly demanding efficient and smooth experiences as they take a greater financial responsibility for their care. In a study by global brand and marketing consultancy Prophet, only 23 percent of healthcare providers measure their consumer relationship. 

Reimbursement policies are placing patients at the center of value-based purchasing and bundled payment models. Hence, a significant percentage of your facility’s A/R is in the hands of patients. With increasing patient financial responsibility, it is essential to give patients a better financial experience.  

Here are 3 strategies to give better financial experiences for your patients:

Using Payment Integration

Payment integration allows your center to be where your patients are in terms of their preferred method to make payments. When your payment system is integrated with your other systems, you have opportunities to collect at every patient interaction point.

With payment integration, patients can have access to their accounts online so they can see what their insurance has covered, verify recurring payments, check their payment status, and make payments anytime and anywhere. You can enable patients to make payments through any payment channel (online, mobile, over the phone, bank’s bill pay site, etc.) with all payments posting to your existing system in real-time.

Providers that use automated payment systems that can post patient payments directly to the patient accounting system report collection increases and AR reductions.

Train Staff

A highly engaged staff likely boosts patient experience, translating into better performance. According to a study by Deloitte Center for Health Solutions, patient experience scores pertaining to interactions with nurses have the strongest association with hospital financial outcomes. ASC staff needs to be able to empathize with patients and be trained to use tools and technologies that improve the patient experience.  

The study also found that staff engagement measures such as quality of staff, staff communication and responsiveness, and appointment ease, among others, were the most important drivers of patient experience.

Find the Right Partner

Financial services are not a core competency for healthcare providers. But by partnering with companies with core expertise in revenue cycle management and financial services that streamline the end-to-end payment process, providers can solve their most pressing financial problems as well as improve the patient experience. 

Your center needs to partner with healthcare-exclusive vendors rather than a one-size-fits-all agency. Choose healthcare specific vendors that take time to educate patients and help patients understand their financial responsibility in the friendliest possible way. The right partner can raise your facility’s standards for ensuring patient satisfaction and improving collections with implementation of technology, automation, and optimization of revenue cycle processes.


How ASC’s Can Protect Patients from Surprise Medical Bills

Exorbitant medical bills have become a new reality for patients. Even when patients receive care in an environment characterized by low co-pays and deductibles, they find it difficult to adjust to high medical bills where out-of-network payments are becoming increasingly normal. 

It is now common for patients to receive additional bills from out-of-network providers, even after settling their co-pays and deductibles. These additional charges come as a surprise as they believe their insurance companies should have settled what they owe to providers.

With surprise medical bills now attracting attention nationally, ASC’s want to develop strategies to protect their patients from them.

Growing Popularity of Surprise Medical Bills

Surprise medical bills arise because patients receive care from providers outside their networks, either in an emergency or for a procedure not offered by their in-network providers. Since these providers have no prior contracts with their insurance companies, they typically send additional bills to patients. In other words, patients are being balance billed. 

Patients are however becoming increasingly aware of surprise bills and are not being quiet about it. This is evidenced in the growing media coverage on the subject which has created public awareness to protect other unsuspecting patients.

There is an increasing need for ASC’s to operate with patients within their network. This comes because of pressures from insurance companies who are also compelling their patients to receive care from providers that they have prior relationships with, to avoid high out-of-network payments.  

The Complexity of Surprise Medical Bills  

Despite these reactions, surprise medical billing has become more complicated and this calls for a proactive response from surgery centers to protect their patients. 

Initially, surprise medical bills would only arise when emergency treatments from providers took place outside of the patient’s carrier network. This is no longer the case as patients today can still receive surprise bills even when their care comes from providers within their network. 

This is because an ASC can be in-network while some of its medical staff are out-of-network. Providers can decide whether they want to be in or out-of-network.  Take for instance an anesthesiologist who decides to stay out-of-network to receive higher payments than he would if he operated within the patient’s network.  

These type of providers are referred to as “invisible providers”. They include anesthesia, pathology, and lab professionals. Patients typically pay less attention to the involvement of these professionals in their surgical care because they are more likely to build relationships with their surgeons or physical therapists when having surgery.

Even though ASC’s are making effort to ensure that these “invisible providers” are brought in-network, some remain out-of-network. This can pose a challenge for a surgery center as patients often hold surgeons and facility owners responsible for any surprise medical bills they might receive.

ASC’s must therefore be proactive to ensure that most of their ancillary professionals are brought in-network. Services rendered by those that can’t be brought in-network should be clearly communicated to patients.

Understanding the Legal Rules

Because of the public clamoring for protection against surprise medical bills, five states including California and New York have passed laws aimed at protecting patients. This trend is poised to increase in scope as two other states, Pennsylvania and New Jersey, are also on the verge of passing laws against surprise bills.

These laws have important features that ASC’s need to pay attention to. Laws can restrict what providers are permitted to charge patients for an out-of-network service. They can also require that patients be fully aware and give consent to receiving care from an out-of-network provider. In the event of disputes between providers and patients, the laws also make provision for the resolution of such disputes.

Providers operating in these states should ensure they understand these laws to avoid lawsuits. Even providers that do not have facilities in these states ought to take steps to ensure that patients are protected from surprise bills. Since ASC’s are known for providing high-quality low- cost treatment, a facility can easily lose patronage from patients if surprise billing is normal and not occasional.


Federal Court Rules for Accounts Receivable Management Industry in Case Supported by ACA’s Industry Advancement Program

The U.S. District Court for the District of Nebraska ruled in favor of the accounts receivable management industry in the April 2018 case of Robinson v. Accelerated Receivables Solutions (A.R.S.), Inc. and David W. Brostrom, 17-00056, 2018 WL ------- (D.Neb. April 19, 2018). The key issues in Robinson were:

Whether Nebraska law allows for the recovery of attorney fees or interest when suing to collect medical debt; and

Whether Nebraska law allows a collection agency to seek and recover an award of attorney’s fees when such fees are incurred by its in-house counsel.

The federal district court in Nebraska held that under Nebraska statute, creditors and their assignees are entitled to request attorney fees and interest on claims for “services rendered” and “material furnished,” which includes unpaid debt for medical services and supplies. 

The district court reasoned that regardless of how the collection agency characterized its claim in the state court, debt collection action as one for “services and supplies” rather than as “an action on account,” the medical “debts at issue were incurred for services rendered or materials furnished” and, therefore, fell within the scope of the Nebraska law allowing the collection agency to request an award of interest and attorney fees.

The district court also found that there is “no basis for disallowing attorney’s fees under [Nebraska statute] by reason of [the collection agency’s] employment of in-house counsel.” In doing so, the district court rejected the consumer’s argument that the collection agency was acting like “a law firm suing pro se, and attorney fees are not recoverable by pro se litigants, even those who are attorneys.” [Editor’s note: When a litigant proceeds without legal counsel, they are said to be proceeding “on one’s own behalf” or “pro se.”] 

The district court explained that while “pro se litigants cannot recover attorney’s fees,” there is no legal reason to define the collection agency as a “pro se law firm.”  In Robinson, the collection agency sought to collect payment from the consumer for unpaid medical bills. Through its in-house counsel, the agency filed a lawsuit in county court against the consumer seeking recovery of the debt, along with an award of pre-judgment interest and attorney’s fees allowed under Nebraska state law. 

The consumer responded by filing a class action Fair Debt Collection Practices Act and Nebraska Consumer Protection Act lawsuit against the agency. The consumer did so to try to end-around common practice in Nebraska in which collection agencies routinely request state law authorized pre-judgment interest and attorney’s fees.  Since the collection of pre-judgment interest is an important and integral part of ACA member businesses, ACA filed an amicus brief in the Robinson case on February 13, 2018. 

ACA submitted the “friend of the court” brief to support its member’s case, and to provide assistance and insight to the federal district court in Nebraska with respect to how the issues raised in Robinson have potential impact well beyond Nebraska. 

ACA asserted that if the district court were to embrace the consumer’s arguments in Robinson it would “subject [the collection agency] to liability for following a practice that many prior judicial precedents had authorized. To impose liability under these circumstances would violate [constitutional] due process. This Court should . . . apply the law in the same way that the Nebraska state courts have applied it for decades.”

ACA is encouraged that this important decision will positively impact its members’ ability to seek and collect payment of interest and attorney’s fees to which they are entitled. And had the consumer’s claims in Robinson been left unchallenged, the consumer’s counsel would be emboldened to continue developing a cottage industry of pursuing identical class actions lawsuits against various collection agencies and their in-house counsel throughout Nebraska on the same theories.

ACA International’s efforts to proactively support the accounts receivable management industry are part of the association’s Industry Advancement Program, and are made possible by funding through ACA’s Industry Advancement Fund. (



Billing Tree Survey Reveals Top Challenges

BillingTree, an ACA International member company in Phoenix, recently released the findings of its second annual Healthcare Operations and Technology Survey showing the impact of technology adoption in the industry, trends in patient payments and new challenges.

The biggest challenges facing providers were a patient’s inability to pay, collecting payments after leaving the facility and more, according to the survey.  Technology adoption continues to remain a key focus in the future. Over the next 12 months, 63 percent of respondents plan to implement a patient payment portal.

“Having collected industry data for two consecutive years, we can see significant trends starting to emerge. One key development is the priority placed on technology adoption,” Dave Yohe, BillingTree’s vice president of marketing said in the news release.  

To request a complimentary copy of the survey, visit:



Billing Tree Survey Examines Technology, Payment Solutions

Billing Tree Survey Examines Payment Solutions Technology

BillingTree, an ACA International member company in Phoenix, recently conducted its second annual Healthcare Operations and Technology Survey to examine current trends in the healthcare industry.  The survey is also designed to collect information on opportunities and challenges in the industry “to provide decision-makers with a comprehensive overview on payment technology usage in their sector,” according to a news release.

“The second annual survey of providers will provide an interesting point of comparison with last year’s results, which showed providers were looking to adopt technology to improve the patient experience, maximize settlements manage compliance,” Dave Yohe, vice president of marketing at BillingTree said in the news release. “The annual survey alongside our upcoming webinar both complement the full suite of BillingTree payment solutions and services for the industry.”

In particular, the 2016 results show the primary challenge for industry professionals is payment collection, followed by patients’ inability to pay and concerns about regulatory compliance, according to the news release.  BillingTree’s 2017 surveys also include the ‘Operations and Technology Survey Series’ covering many key vertical markets, including Accounts Receivables Management, Property Management and Financial Services.

The company held an online seminar, “Patient Receivables – Who Are The People In Your Care?” in December to showcase many of the common characters healthcare providers encounter when collecting on patient responsibility. The event will offer useful tips on how services and technology can assist in managing each profile and increase the likelihood of collecting payment in a timely and compliant manner.

Yohe said the survey was open through December and a report on the findings should be available in January.


Education & Innovation Needed from Providers to Boost Millennial Medical Bill Payments

Credit Bureau TransUnion released a new report recently that points out that the healthcare industry needs to not only simplify the medical bill paying system, to be innovative, and help patients understand their health insurance benefits if they are ever to get millennials to pay their medical bills on a consistent basis.  

This report from TransUnion pointed out that nearly six out of every ten millennials, or about 57 percent, had either no understanding or very little understanding of their health insurance benefits.  The group known as gen X was found to have about 50 percent who said that they had little or no understanding of their benefits while only 41 percent of the baby boomer generation claimed they had little or no understanding of their health insurance.

Another noteworthy finding from the survey was that even though most millennials do have health insurance, it typically takes them longer to pay for their medical services than it does for other generations according to TransUnion.  One reason for this is thought to be transparency in the billing process as well a lack of notification pertaining to out-of-pocket costs by insurance companies prior to treatment.  

The TransUnion report also points out that 46 percent of millennials polled said they would that the likelihood that they would pay for their medical services would be greater if cost estimates were given at point of service.  It appears that education surrounding their approach to health insurance options would be helpful to them.  The report showed that 26 percent of millennials were happy with high deductible health insurance plan options, whereas on 17 percent of gen X chose these plans and only nine percent of the baby boom generation chose such plans.

“Providers should be looking for opportunities to improve cash flow coming from millennial patients to continue thriving.  At Mnet, we have live agents who are more than happy to work with patients to help educate them about the healthcare process and how their health insurance policy works.  We have found that this drastically enhances the patient experience” said Mnet Health CEO David Hamilton.

Another interesting point that came from the TransUnion report is that millennials are the most likely to compare costs for healthcare with a full 40 percent saying that they have shopped rates whereas only 29 percent of gen Xers and 22 percent of baby boomers have shopped around for servicing costs.  

While it’s true that baby boomers are the most likely to have medical needs and the high costs related to those needs; it appears possible that a campaign aimed at educating them about the value of shopping around for services could likely create a change in their spending.  Generation X could also benefit from comparing healthcare costs as well.  Meanwhile, transparency in pricing for services is likely to add to the numbers of those who shop pricing for healthcare services.


IRS Revokes Nonprofit Status from Hospital Under 501(r)

The Internal Revenue Service (IRS), for the first time since regulations for tax-exempt hospitals went into effect in October 2016, has revoked the nonprofit status for one hospital.  Nonprofit hospitals are required to comply with the Internal Revenue Service’s 501 (r) rules, including completing a community health needs assessment and meeting financial assistance policy requirements. Hospitals subject to 501(r) must also adhere to limitations on charges and follow billing and collection practices under the requirements, ACA International previously reported in the January 2016 issue of Pulse.

According to a report from FierceHealthcare, “The IRS deemed the hospital ‘egregious’ for its failure to meet the requirements, concluding that it had ‘neither the will, the resources, nor the staff to follow through’ with them.”  The IRS issued a letter to the hospital for the revocation in February 2017 and released it on their website in August.  The primary reason for the revocation, according to FierceHealthcare, is the hospital failed to make its community health needs assessment available to the public online.

The letter states: “You are a hospital organization which with the requirements of IRC section 501 (r), to conduct a community health needs assessment, adopt an implementation strategy and make it widely available to the public.”  It also states the hospital is a small rural facility without the financial or staffing resources to dedicate to meeting the requirements of 501 (r) and the community health needs assessment.

Under the Affordable Care Act, the IRS is required to review activities at tax-exempt hospitals once every three years.  Requirements, previously reported in Pulse, for a hospital to maintain its nonprofit status, set by the IRS and mandated by the Affordable Care Act, include:

Establishing written financial assistance and emergency medical care policies.

Limiting amounts charged for emergency or other medically necessary care to individuals eligible for assistance to not more than amounts billed to people with insurance for the care.

Determining if an individual is eligible for financial assistance before using extraordinary collection practices.

Conducting a community health needs assessment and adopt an implementation strategy at least once every three years.

Jan Smith, a tax senior manager in Crowe Horwath’s Healthcare practice, said in an interview with the Healthcare Financial Management Association (HFMA) that it is unlikely this action by the IRS will set a precedent for revoking nonprofit status of other hospitals.

“If hospitals are making a good-faith effort to comply, I would be surprised if the IRS would revoke their tax status at this stage of 501 (r) examinations,” Smith said in the interview with HFMA.  More information: and


'Balance Billing’ From Providers Shows Need for State, Federal Protections

Consumers in some states are receiving “balance bills” for healthcare if they are treated by an out-of-network provider not covered by their health insurance plan, according to an issue brief from The Commonwealth Fund.  “Privately insured consumers expect that if they pay premiums and use in-network providers, their insurer will cover the cost of medically necessary care beyond their cost-sharing,” The Commonwealth Fund reports in the brief, Balance Billing by Health Care Providers: Assessing Consumer Protections Across States. “However, when obtaining care at emergency departments and in-network hospitals, patients treated by an out-of-network provider may receive an unexpected ‘balance bill’ for an amount beyond what the insurer paid. With no explicit federal protections against balance billing, some states have stepped in to protect consumers from this costly and confusing practice.”

The Commonwealth Fund researched the issue to better understand the state laws to protect consumers from balance billing by an out-of-network provider and found that most states do not have laws in place.  “Of the 21 states offering protections, only six have a comprehensive approach to safeguarding consumers in both settings, and gaps remain even in these states,” The Commonwealth Fund reports. “Because a federal policy solution might prove difficult, states may be better positioned in the short term to protect consumers.”

Private health insurance purchased by consumers is a mechanism to offset the high cost of healthcare.  “They expect that if they pay their premiums and use in-network providers, their insurer will cover the cost of medically necessary care beyond their specified copayments, coinsurance, and deductibles,” according to The Commonwealth Fund.  However, if consumers are treated by an out-of-network provider, such as during an emergency room visit, they may face extra costs. 

Out-of-network providers do not have contracts with health plans and therefore no negotiated payment rates, according to The Commonwealth Fund.  In some cases, consumers will receive “balance bills” totaling thousands of dollars when an out-of-network provider issues a charge that is the difference between health insurance coverage and doctor’s fees.  And, oftentimes when a consumer is cared for out-of-network, they did not have a choice about the provider.

Research published in Health Affairs Web First, “One in Five Inpatient Emergency Department Cases May Lead to Surprise Bills,” cited by The Commonwealth Fund shows 14 percent of emergency department visits and 9 percent of hospital stays were likely to result in an unexpected bill. Twenty percent of patients admitted to the hospital from the emergency department were likely to receive an unexpected bill, according to the research.  Additional findings in the issue brief include: 

Twenty-one states have “direct protections” in their statutes or regulations for consumers who would be subject to balance bills as a result of out-of-network care, however they do not prevent balance billing for consumers in all situations;

Six states—California, Connecticut, Florida, Illinois, Maryland and New York—have a comprehensive approach to protecting consumers, including “holding them harmless from extra provider charges and prohibiting providers from balance billing;”

In 12 states, “balance-billing protections only require insurers to hold consumers harmless from the billed charges of providers but do not prohibit providers from sending bills.  Because these states do not prohibit providers from balance billing, consumers may still receive a bill from a physician, hospital, or other provider.” In those states, Colorado for example, regulators have reported consumers receive balance bills and may not understand their rights not to pay.

Additionally, in 29 states and the District of Columbia, there are no laws or regulations “that explicitly protect consumers from unexpected balance billing by out-of-network providers in [emergency departments] or in-network hospitals.  The Commonwealth Fund concludes in the issue brief that balance billing can create financial troubles as much as impact consumers’ views on the healthcare system.

“Consumers expect that their health insurance will cover the cost of most medically necessary care beyond their cost-sharing amounts. But when emergencies or other unexpected circumstances expose them to out-of-network providers, balance billing can create financial burdens and undermine their confidence that health insurance will protect them from financial hardship,” it reports.

“Concerns about balance billing are not new but may be growing as the use of narrow provider networks becomes increasingly common. The fact that consumers are more likely to experience balance billing in situations where they have no control over which providers treat them suggests that additional state and federal policy solutions are needed to protect consumers fully and limit financial risk.”


Read more in the issue brief here:





How High-Deductible Health Plans Influence Providers’ Collections

The prevalence of high-deductible health plans and a growing gap between self-pay and insured patients are continuing to influence healthcare providers’ collections on their accounts, according to a new report, “Revenue Recognition and High-Deductible Plans: The Greater the Patient Portion, the Lower the Collections,” prepared by Crowe Horwath, LLP.

“In what appears to be an ongoing evolution of self-pay customers, the collections gap between uninsured accounts (‘true self-pay’) and the patient responsibility portion on insured accounts (‘self-pay after insurance’ or SPAI) is widening,” according to the report.  Crowe Horwath analyzed a sample of 172 hospitals in its benchmarking database to determine the number of hospitals separating patients into payer groups, including “true self-pay” and “self-pay after insurance.”  It found that 74 percent of those hospitals, each with more than 125 beds, separate patients into the two payer groups.

Collections from patients with “very” high-deductible health plans are becoming similar to those of traditional uninsured patients in some cases, according to the findings in the report.  “The Crowe benchmarking data reveals that true self-pay patients generally pay approximately 6.06 percent on the dollar, while self-pay after insurance patients pay approximately 15.51 percent overall,” according to the report.  Overall, more consumers have enrolled in high-deductible health plans over the last two years and healthcare providers are struggling to secure the amounts owed by patients.

“The percentage of collections on patients with account balances greater than $5,000 is four times lower than collections on low-deductible plan patients,” according to the report.  “Hospitals have traditionally separated insured patients and uninsured patients into different portfolios when conducting financial analysis,” said Brian Sanderson, managing principal of Crowe healthcare services group. “However, recent findings indicate that very high-deductible plan customers may pay at a rate more similar to that of uninsured patients.”

Crowe Horwath also analyzed self-pay after insurance accounts based on inpatient or outpatient services.  Key findings on inpatient self-pay after insurance include:

Patient account balances less than $1,200 have a payment rate of 40.1 percent.

The payment rate drops significantly—to 17.6 percent—near the inpatient Medicare deductible amount of $1,201 through $1,450, where Medicare bad debt may have implications on collections, according to Sanderson.

The payment rate for higher deductible health plans with balances of $1,451 through $5,000 is 25.5 percent.

The payment rate drops to 10.2 percent for balances of $5,001 through $7,500, 4.1 percent for $7,501 through $10,000, and 0.9 percent for accounts with a self-pay balance at more than $10,000. 

Findings on outpatient self-pay after insurance payments also vary significantly across different segments, according to the report:

The average self-pay payment is 18.2 percent across all outpatient accounts receivable (AR).  

A significant increase exists in the percent of self-pay after insurance outpatient AR residing in the $10,001 through $500,000 segment—from 14.6 percent of AR in 2015 to 29 percent of AR in 2016.

The outpatient payment rate is 23.7 percent on AR between $1 and $5,000.

The outpatient payment rate is 4.7 percent on AR between $5,001 and $7,500.

“While average patient balances for high-deductible plans increase, payment collections vary based on the size of the balance,” the report concludes.  “As healthcare providers analyze the ‘realization’ (i.e., the percentage of net revenue versus gross revenue) of their managed care contracts, they also should understand risks associated with high-deductible plans and should recalibrate their AR valuation and potential impacts on revenue recognition to account for these new market factors.

Parsing accounts based on patient balance will prove a particularly insightful analysis for any finance team and likely will create a more reliable collectability factor based on historical experience.”  

More information:


Managing Patient Payments: A Balancing Act (Part 2-The Future of Patient Financing)

Consumers want clear explanations of their bills and options after they receive care as much as they do when they evaluate costs at healthcare providers in advance, according to the 2016 Healthcare Consumerism Study by ClearBalance.

Fifty-five percent of the respondents in 2016 said they are sometimes or always confused by medical bills and 61 percent reported they are sometimes or always surprised by out-of-pocket costs they owe, according to the survey.

Additionally, 65 percent of respondents said clear, easy-to-understand medical bills would have a positive impact on selecting a healthcare provider.

Patient financing options are important as healthcare providers are seeing reduced reimbursement for care, meaning patients have a greater responsibility for their bills and may not have the ability to pay for a high healthcare expense, especially if it is unexpected.  According to athenahealth’s research, 50 percent of providers fail to receive at least $23,000 a year from patients. Forty percent of providers fail to receive more than $31,713 a year from patients.

There are best practices that can help improve collecting from patients, including evaluating patient pay measures such as time-of-service collection rate as well as the number of self-pay days in accounts receivable and bad debt write-offs, according to athenahealth.

According to Haupt in his presentation and ClearBalance Patient Pay Research from June 2014, payment plans can lower bad debt and provide better patient satisfaction. Reducing bad debt and improving patient satisfaction are the top two factors influencing providers’ decisions to offer patient financing options followed by reducing accounts receivable days, immediate cash flow, eliminate collections costs and improving staff and physician satisfaction.

Providers can also identify tools such as training staff, developing a collection plan before a patient’s office visit, time of service collections through card-on-file agreements or payment plans for large balances, and ongoing collection plans to help keep patient payments on track in a way that works for everyone, athenahealth concludes in its research.

For example, athenahealth reports payments plans for patients with high balances on their accounts “are essential for increasing overall collections, especially for practices whose patients are responsible for a substantial portion of the total cost of care.”  Healthcare providers with uninsured patients or a high percentage that have high deductible health plans can also consider time-of-service collections and even a set down payment from the patient, according to athenahealth. 

Card-on-file agreements can also be helpful in collecting patient obligations at time-of service.  Even if the patient’s bill amount is not known, providers and patients can agree to a payment range that will be collected.  “We really are in a two-payer market, with government and commercial payers in one bucket and patients in another,” Haupt explained. 

Providers still must collect from commercial and government payers. As reimbursement tightens from that payer category, providers have no choice but to ensure they collect as much as possible from the second payer category – the patient – to maintain their financial health.

Overall, according to ClearBalance, many patients can only afford medical bills if they can pay for their expense over the long term and through a payment plan.  “Providers should consider patient financing because over time, it delivers better net collection,” Haupt said.


Managing Patient Payments: A Balancing Act (Part 1)

A growing number of healthcare providers are considering how to reach patients as self-pay responsibility for their medical bills increases, including the option of offering patient loan financing programs at different stages of patient interaction.  The programs help providers lessen their financial burdens and lower bad debt.

Bruce Haupt, president and CEO at ClearBalance, a healthcare patient payment financing company, presented on Understanding Alternative Patient Financing Options at ACA International’s Fall Forum and Expo in Chicago. Healthcare providers use patient financing companies and often expect early-out collection agencies they work with to provide options as well.

“Offering patients an extended payment plan, such as the ClearBalance zero interest loan, doesn’t shift the burden of collecting bad debt,” Haupt said. “It’s really to provide a better patient payment option and give the health system a better collection rate overall.”  Patients’ financial obligations for their medical bills represent 18 percent of revenue for healthcare providers, according to recent research on patient pay from athenahealth.

High deductible health plans are becoming more prevalent today and with that patients’ financial responsibility for their healthcare also increases, even if their monthly premiums are lower.  According to athenahealth, the number of consumers in the U.S. with high-deductible health plans has increased 75 percent since 2010. More employers will offer only high-deductible health plans by 2018 and overall the popularity of the plans is pushing healthcare expenses out of reach for more and more consumers, according to athenahealth.

Providers offering patient financing options can tailor the programs based on their revenue cycle workflow and how they present the options to their patients.  “Revenue cycle leaders care very much about the patient and patient experience. We work with the provider to ensure financial counselors are trained in how to introduce the program.

Ultimately, offering a patient loan program is a value-add that creates loyalty and patient satisfaction,” Haupt said. 

More and more consumers consider their healthcare in terms of price and want estimates for the cost and options for how to pay for it within their budget, much like purchasing a vehicle or home. According to the ClearBalance

Healthcare Consumerism study 2016 results, 91 percent of respondents said healthcare is an expense that requires financing of more than 12 months.  One in three respondents said they would delay care if a financing option wasn’t available through their healthcare provider.

“Patient financing is absolutely intended to be a part of the hospital’s payment policies for patients,” Haupt said. “If you were considering going to a particular hospital for care or surgery, you’re probably going to want to know the cost. That’s what’s happening today with tools for price estimation, for example. People want to know what their cost will be.”

According to a 2016 Experian Health webinar “Providing Patients with Estimates: How Knowing What They Owe Can Boost Your Bottom Line” presented by product manager, price transparency, Elizabeth Serie, as consumers’ out-of-pocket healthcare expenses increase, price transparency information for patients is becoming critical for them to access at any time; allowing them to make educated decisions on how much they spend.

Technology can help patients and providers be on the same page with determining the best cost of care; and providers can implement standardized processes and best practices to communicate with patients, Serie explained during the webinar.  According to Serie, providing patients’ documentation in paper form in person or through mail or email after a visit can be a critical added step to ensure they can make an informed care decision.

And, providers can have a copy of that information readily available when the patient comes in for their scheduled care.  While price transparency continues to be a priority, providers or early-out collection agencies working with consumers on their behalf can discuss patient financing options at preregistration for care, time of service or after care to help ensure payment.  “My recommendation is to engage patients early in the process. Today there are lots of ways to do that,” Haupt said.

“A provider needs to think of patient financing as one component of their overall strategy to address the need to collect patient obligations and provide a good patient financial experience. It’s just a piece, but they need to be clear how it fits in their strategy.”

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