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Pulse Magazine

Pulse Magazine

Paper Billing Remains Prominent Among Health Care Providers; Price Transparency Improves

 

In a Waystar and HIMSS Analytics study of patients who visited a health care provider in the last year, new trends in price transparency and payments were revealed.  In particular, a majority of providers continue to issue paper statements, and cost estimates at time of service reflect improvement in price transparency, according to a news release on the Patient Payment Checkup Survey.

“Our second annual survey reveals that the health care industry is at a tipping point. Patients want to understand their health care expenses given how much they pay out of pocket,” Matthew Hawkins, CEO of Waystar a provider of revenue cycle technologies, said in the news release.  “At the same time, providers are looking for ways to increase patient satisfaction and simplify their revenue cycles.”

Key findings from the survey, including over 1,000 patients and approximately 900 financial executives in the health care industry, are: Nearly 100 percent of health care executives report that they bill patients using paper statements, however over half of patients said they would prefer to receive and pay their medical bills electronically.

Eighty-five percent of patients responding to the survey felt the same responsibility to pay for health care as they do other services, however less than 20 percent who have commercial insurance plans found it “easy to understand and convenient to pay for” health care costs.  Waystar also finds that cost estimates from their health provider help patients comprehend what they owe. Eighty-six percent of patients who received cost estimates report they understood their payment responsibility, which ultimately helps with faster and easier payment for providers.

However, less than one-third of patients surveyed said they know to ask for a cost estimate at their healthcare provider’s office while 87 percent of health care professionals participating in the survey say that they are able to offer their patients a cost estimate upon request.  “The survey indicates a significant difference between patients and their provider organizations in terms of perceived payment timeliness,” Waystar reports. 

Nearly half (48 percent) of providers said that it takes their patients over three months to pay the full balance of their bill, versus only 24 percent of patients thinking that it takes them longer than three months to pay their balance. “This perception gap may lie in the timing of payer reimbursement.  Patients may believe that they do not owe anything until their payers pay their share,” according to Waystar.

“Our survey reveals that patient consumerism is advancing quickly as organizations adopt advanced payment technology,” Hawkins concludes. “Patients have a higher expectation than they used to have.  It is important that lagging health care organizations improve their patient billing and payment methods faster to remain competitive. 

Patients are already seeking health care from providers whom they trust with both their health and their pocketbooks.  Providers who don’t provide transparency and convenience will be left behind.”

More information: https://bit.ly/2svglBL

 

Cyber Liability Insurance 101: Will it Help Agencies and Providers Combat Data Security Threats?

Data security risks are not going away in the health care sector and while strategies such as employee training and a strong data breach response system help, a new option to protect your business is emerging: cyber liability insurance.

Health care cybersecurity spending is predicted to grow to $65 billion between 2017 and 2021, according to the Experian 2018 Data Breach Industry Forecast.  Experian also reports health care organizations will be the most targeted industry this year as new and sophisticated attacks are on the horizon.

The U.S. Department of Health and Human Services (HHS), media or state attorneys general received 233 breach industry reports from January to June 2017.  “For the 193 attacks for which there are numbers, 3,159,236 patient records were affected,” according to Experian.  

Providers are increasingly purchasing cyber liability insurance policies to ensure financial protections and resources to work through data breaches and maintain their reputation are in place, Becker’s Hospital Review Content/Strategist Editor Brooke Murphy reports in the white paper “Can Health Care Providers Afford Not to Have Cyber Insurance in 2018?”

“As cyber threats become the reality, and as [insurance] carriers have identified how significant and complex online exposure is, cyber liability policies have become more refined and more necessary,” James Fasone, senior vice president and national health care practice leader for Key Insurance & Benefits Services said in the white paper.

Purchasing cyber liability insurance may ultimately be more affordable than the costs to providers after a data breach occurs, from attorney’s fees to purchasing credit monitoring systems for affected consumers, according to the white paper. That’s not to mention the costs from any disruptions to providers’ business and as a result of time spent notifying patients.

And, even if providers spend money on the front end to protect their company and data from a cyber-attack, cyber criminals continue to find their way around firewalls and security systems.  And, remember, the strongest security protections can still be put at risk by human error if not used properly.

Employees continue to present a big risk to companies, according to Experian.  Regular training and a refresh of your data security policies are critical to staying ahead of threats and risks to sensitive information and data.  It’s also helpful to limit the number of employees who have access to sensitive data, especially on mobile and portable devices. Make sure you have a strict policy for access and transport of mobile and portable devices containing sensitive information.

“Cyber liability insurance helps hospitals cover the costs of a data security breach for things like identity protection solutions, public relations, legal fees, liability and more due to loss, theft and unauthorized disclosure of data,” according to Becker’s Hospital Review.  

When considering if cyber liability insurance is right for your business, and the level of insurance that is the best fit, it comes down to matching coverage with your “business objectives, asset vulnerability, third-party risk exposure and other external factors,” Murphy reports. 

“The cyber insurance industry in the last three to five years has rapidly evolved to meet the needs of health care businesses in a digital world,” Fasone said in the white paper. “That means there are many more companies in the market offering a greater variety of coverage.”

The Path to a Partnership

Mergers and acquisitions in the health care sector are expected to be robust in 2018 and continue to grow based on strong activity in the market, and trends such as the shift to value-based care models.  According to the Corporate Advisory Solutions (CAS) fourth quarter 2017 newsletter (https://bit.ly/2KjAn9R), at press time, mergers and acquisitions in the revenue cycle management sector have “remained consistent and we anticipate seeing a high level of activity in 2018.

Technological advances will dominate the conversation for RCM companies and health care providers. 2017 required health care organizations to respond to several challengaes and transformative trends, including the political landscape change, growing role of technology, and shift to value-based care.  USCB America’s recent merger and acquisition of RevSolve Inc. and J&L Teamworks, two health care-related industry leaders, is an example of this trend and how to stay ahead in the competitive marketplace.

RevSolve, a Scottsdale, Ariz.-based company formerly known as Collection Service Bureau Inc., is led by Chris Becraft. The ACA member company founded in 1964 was rebranded as RevSolve, a firm that prides itself on being “the best-in-class revenue solution for health care providers,” according to a press statement on the merger and acquisition released by the USCB America.

J&L Teamworks, also an ACA International member company, was established in 1990 in Lodi, Calif., as a receivables management services firm that works with hospitals, medical groups, clinics and physicians. The company, which was previously privately owned and managed by two business partners, is now part of USCB’s family of employee-owned companies.  

“In today’s fast-paced and competitive environment, it becomes critical to look for avenues to retain tenured and successful employees and to broaden the services offered to our business partners,” said Albert Cadena, USCB America’s CEO and president.  The companies worked with CAS, a merger and acquisition advisory firm and ACA International member based in Philadelphia, throughout the process.

“In my almost 20 years of providing M&A advisory services to the outsourced business services sector, I have not seen a better fit culturally and operationally than what exists between RevSolve and USCB America,” Mark Russell, managing partner at CAS, said in a news release on the merger.  Cadena said the merger with RevSolve and J&L Teamworks was the opportunity he had been seeking.

“I have been searching for a merger/acquisition with companies who specialize in the health care side of our industry for the last eight years or so,” he said. “This was a direction and a goal we needed to move forward with in order to continue to be competitive in the marketplace, acquire talented employees and also to expand our geographical presence.”  Cadena added that the decision to seek agencies to merge with was motivated by needs of his clients in the health care space.

“Health care providers are seeking a partner to provide an array of services in revenue cycle management,” Cadena said.  “We also saw in the industry that smaller companies were seeking for an exit strategy and the expectations from the health care receivable side were making it difficult for some to compete.”  Meanwhile, Becraft shared his resolution for the future of the company.

“In deciding the next chapter of our 53-year-old company, we looked for a partnership that could bring further depth to our health care revenue cycle services, a commitment to expand our presence in Arizona, and a culture that complements ours and that of our clients,” Becraft said. “We nailed every criterion. We are also proud to now be a 100 percent employee-owned company as part of this merger, which is a tremendous benefit to current employees and a huge competitive advantage to acquiring the best talent for the future.

Our staff are really in top spirits about all of it. As employee owners, they have a chance to have more than just a career; they own part of the business.”  Like USCB America, RevSolve was also reviewing its strategic direction for the past few years and how it could capitalize on opportunities available through working with health care provider clients.

“We too needed to be larger, but more importantly, we need to be able to offer a deeper stack of revenue cycle services to our current and prospective clients,” Becraft said. “We had a lot of criteria that included market facing objectives, but also internal ones such as how can this help our employees grow in their careers with the company.”

With this in mind, RevSolve was faced with three choices, he said … “develop the services ourselves, acquire other companies or merge with a complementary company.”  And, according to Becraft, the merger makes sense given the same trend is going on in the health care market.  “Health care providers are merging at breakneck speed and their needs are growing ever larger and more complex,” Becraft said.

“The most successful revenue cycle companies are expanding their relationships across multiple lines of services with their clients.”  RevSolve and J&L Teamworks join a host of proud Employee Owners at USCB America, who offer a full enterprise of health care revenue cycle and management solutions, according to the press release from USCB. USCB America has been in business for over 100 years and has been an employee-owned company for almost two decades.

“In both J&L and RevSolve I have seen positive feedback for all the employees, as always the unknown is on the minds of all, and it’s up to USCB to continue on its path of bringing [us] all together as one family,” Cadena said. “I have seen a lot of employees excited about growth opportunities and the options to possibly transfer to other office locations.”

When asked his advice for other companies considering a merger, Cadena said start by taking a look at your long-term goals.  “For us it was to strengthen our family of companies and to continue to provide excellent service to our current and future clients,” Cadena said.

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

  • June 22, 2018
  • Published in Billing

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. (https://www.acainternational.org/industryadvancement-program)

 

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