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3 Tips for Working with RCM Partners to Handle Self-Pay Patients

Patient balances present one of the most significant challenges in healthcare especially for surgery centers. With ever-rising healthcare costs, ambulatory surgery centers (ASC’s) see an increase in the number of patients that have high deductible health insurance plans. Patient obligations have increased 29.4 percent since 2015, and many are finding it difficult to pay off their medical bills and large out-of-pocket costs.

ASC’s invest significant resources and time to settle overdue payables from patients who are unable to manage paying off their medical bills. Many surgery centers find themselves reaching out to patients, sending letters, emails, and calls in an effort to collect from self-pay patients. 

However, collecting from patients is not naturally the expertise of a healthcare facility, so surgery centers often get the help of an RCM (revenue cycle management) partner or collections vendor.

How can your ASC work more effectively with its RCM partners to handle self-pay collections? What do you need to look for in selecting a third-party collections partner? Here are 3 tips to consider:

1. Implement Digital Payment Transmissions 

Interestingly, the increase of high-deductible plans has also coincided with the trend of healthcare consumerism. Patients now expect that they can pay their bills and manage their accounts online from their mobile phones or desktops. 

Surgery centers can work with their RCM partners to step up their game and make it easy for patients to register by tablet and pay electronically and get payment in advance for elective procedures. 

With self-pay patients, it is important to choose partners that are able to offer automatic enrollment in payment plans and financial counseling to avoid revenue leakage. 

2. Leverage Automation Technology

By its nature, self-pay accounts are risky. The cost to collect could reach up to three times higher than on commercial insurance accounts. The longer a self-pay balance goes unpaid, the harder and costlier it is to collect it.

This is why automation is becoming the new standard in revenue cycle management. Choose partners that can use automation to step up collection efforts of past due medical debts, decrease human error, maximize productivity, reduce costs, and streamline processes.

Here are four essential areas that needs vendor automation especially for self-pay accounts:

Daily accounts submission

Daily payment and adjustment account reconciliation

Vendor collections automatically directed to existing merchant services

Automatic invoices that are gross remit and auto-paid 

3. Focus on Personalization: Patient-Centric Financial Experiences  

With the help of your RCM partner and the use of technology, your facility can gain visibility into patient payment behavior and identify trends, bottlenecks, and needs. A one-size-fits-all approach doesn’t work with self-pay accounts. Hence the need for better personalization.

Here are some areas to focus on to create patient-centric financial experiences:

Improve medical bill (eliminate areas of confusion) 

Using price transparency tools

Patient education strategies

Flexible payment methods

Patient financial advocates

Having trained and patient-friendly staff (front-end and collections)

Better patient communications

The key to better personalization is using technology and training your staff. Work with your RCM partner to have full visibility into where all payments are coming from and have daily activity reports on all types of payments received, categorized according to account number, source of payment, etc. By having a 360-degree view of patient payment behavior, your ASC can create strategies that would personalize self-pay collections and achieve higher success rates.

 

 

How to Prevent Revenue Leakage in Your ASC

The healthcare reimbursement landscape has changed dramatically in just a few years. Just five years ago, healthcare providers could get 90% of their revenue from government payers (Medicare and Medicaid) and commercial insurance companies, while the remaining 10% comes from patient payments.

Today, patient payments can make up as much as 33% of provider revenue. Last year, enrollment in high-deductible health plans surged to include nearly half (47 percent) of those privately insured. 

The biggest challenge facing healthcare providers is the change from payer-based (insurance) revenue to consumer-driven reimbursement.

Many providers typically do not receive full reimbursement because patient collections are leaking throughout their revenue cycle. Some do not even detect the source or depth of their revenue loss.

Track Revenue Cycle Leaks 

It pays to know how much revenue you’re truly missing out on, and where they are coming from. Leakage could come from coding errors, manual payment and collection processes, unbilled revenue, and poor denials management.

It is important to conduct thorough audits that can find even fewer common areas where revenue leakage can occur. For example, unbilled insurance can lead to lost revenue for your ASC. To solve this problem, create reports that track unbilled insurance. In the same way, you can also have a report that tracks unbilled patients, including self-pay, promissory notes and patient balances after third-party payor responsibility is met. Insurance/eligibility verification also helps to increase clean claims rates, eliminate costly rework and accelerate reimbursement. Hence, it is good to have reports that show who has been verified.

It’s essential that each procedure performed in the practice becomes a claim in the billing process. If your billing company does not audit and validate the receipt of your interpretation reports, you easily could be losing 10% or more of your revenue, no matter how effectively the rest of your billing process performs.

Stop Patient Leakage

In 2018, a survey of healthcare executives conducted by Sage Growth Partners and Fibroblast revealed that 43% of the respondents report losing 10% or more of their annual revenue due to patient leakage while 23% don’t even know how much they are losing. Patient leakage translates to revenue leakage.

“Patient leakage” is the industry term when primary care physicians refer patients to out-of-system providers (instead of those in their network), resulting in significant business losses. It could also refer to patients seeking out other healthcare groups (out-of-network) for their care. 

Patient leakage also happens when a patient referral that should stay inside a health network ends up leaving for another or a patient that should receive care in the network doesn't follow through on the care.

Why does this affect an ASC’s bottom line? Your facility could lose considerable revenue and control when patients are being referred to other networks or to poorer performing providers within their own network. In a value-based care model, patient leakage can also pose a risk due to patients developing an event that is more acute than it should've been had they received care.

One of the key solutions to prevent patient leakage is better patient engagement and better care coordination. Modern and simple technologies like mobile EHRs, text and email messaging, and patient portals help create a personal connection with patients. In the long run, this builds loyalty and staying power. The provider-patient relationship is always on top of the list on what patients are looking for in their healthcare. 

Here are more suggestions:

Providers should specify referrals in their network. In the survey, client data indicates that 80% of the time, providers neglect to even specify who a patient should see.  

Follow up to see if patients received the care for which they were referred.


By preventing patient leakage and improving reporting and auditing, ASC’s can significantly drop their revenue leakage dramatically and protect their bottom line.

3 Strategies for a Patient-Centered Revenue Cycle in 2019


As patient financial responsibility grows, the patient experience becomes very important in your revenue cycle. Aligning the healthcare revenue cycle with patient needs becomes the key to improving revenue collection and increasing patient volumes.

Here are 3 strategies to consider for your revenue cycle:

1.Personalize Financial Plans and Options

Each patient’s circumstances are unique and require a different approach in terms of financial services and counseling. Some patients can easily afford to pay their bills while others would need payment plans tailored to their ability to pay. 

The key to more personalization would be data on patient’s propensity to pay and also data gathered from patient engagement. Providers would then be able to predict the likelihood that patients will pay their out-of-pocket balances.

To achieve this, here are some of the things that a healthcare provider should do: 

Estimate patient out-of-pocket obligations.

Verify patient information and benefits eligibility. 

Predict the patient’s propensity to pay.

Offer payment plans tailored to each patient’s budget and ability to pay.

When appropriate, offer financial assistance programs especially to the uninsured.

2. Leverage Technology and Build Automated Systems 

Eliminating redundant manual processes allows providers to better connect with their patients to resolve financial issues. With automated systems, your staff can focus on patient interaction and communication.  Technology can make the revenue cycle management process more efficient and more accurate by reducing missed appointments, verifying insurance information, limiting claims denials, and reducing coding errors. 

Healthcare providers need to implement people and technology systems to automate and streamline workflows specific to patient needs. Here are some areas where automation can improve the patient experience:

Prioritizing staff workflow

Preventing eligibility denials

Gathering critical data

Self-pay vendor automation (daily account submission and real-time account adjustments)

3. Align Collection Strategies with Patient Consumerism

Healthcare providers can learn a lot from the techniques used by the retail industry in terms of billing and collections. Consumers are accustomed to flexible payment options, installment plans, and easy-to-understand bills. Consumers also know the price before they purchase services or items. But the key challenge in healthcare has always been clear price information (lack of price transparency).

As patient responsibility increases, understanding the cost of care prior to service will be critical to boosting patient collections. When patients are educated about their financial responsibility and given financial estimates, they are more likely prepared to pay in advance through point-of-service collections. 

To be able to transform the collection process, patient should be provided with the following: 

Online payment arrangements or online patient financing options 

Online (or mobile) bill pay

Price estimates based on the patient’s specific payer information

Guarantor-level billing (family’s statements)

Healthcare providers now rely on their patients as much as their payers with regards to their bottom line. Improving the patient experience and meeting consumer demands will be more crucial to improving the healthcare revenue cycle in the coming days. 

The Current Healthcare Payments Landscape and Future Opportunities

The overarching trend in today’s healthcare payments system is that high deductibles have become the norm and patients now have greater financial responsibility. Out-of-pocket expenses are projected to reach $608 billion in 2019 according to a report by Kalorama Information. Here are more trends defining the current healthcare payments landscape:

Confused Patients

Faced with higher deductibles more than ever before, patients are also struggling to understand their bills. A 2016 survey revealed that 72 percent of patients have received a medical bill that they didn’t understand. In addition, according to new research from NORC at the University of Chicago, 57 percent of US adults say they've received a surprise medical bill, and 82% say hospitals are "very" or "somewhat" responsible for their surprise bills,.

Antiquated Processes

Tasks like coverage verification, sending and receiving bills, and obtaining prior authorization (tasks which can all be automated) are costing healthcare providers $9.5 billion annually according to Business Insider Intelligence. These administrative tasks are also one of the reasons of increasing medical bills. Billions could be saved just by automating the antiquated processes in these areas.

Fortunately, healthcare providers and collection firms are investing in new digital payment solutions to combat these antiquated processes according to the latest survey by BillingTree. 54.5% of respondents plan on adding web payments (patient payment portals) within the next 12 months, and 27% plan to add “text to pay bill” (text payments) for the same period.

Paper Payment Systems

There’s still a lot of work to do in the healthcare payments landscape in terms of moving from paper to digital. In a recent InstaMed survey, 58 percent of providers said paper statements are the primary method for patient collections and a shocking 41 percent have not changed their billing process in more than 5 years. This is confirmed by the fact that 79 percent of patients said they have received a paper medical bill. 

Most interestingly, a study of large data breaches (affecting 500 patients or more) by researchers at the University of Central Florida and at the United States Air Force Joint Base in Charleston, South Carolina, revealed that paper and films were the most frequent location of breached data, occurring in 65 hospitals during the study period. While network servers were the least common location, but network server breaches affected the most patients overall.

Future Opportunities: Optimizing Your Revenue Cycle

A recent TransUnion analysis showed that 30% of self-pay accounts (those patients without health insurance or those that have a patient balance after insurance) will generate more than 80% of the self pay revenue collected by hospitals. This means that hospitals may be leaving millions on the table if their revenue cycle is less than optimal. An optimized revenue cycle ensures that earned revenue becomes paid revenue.

Why is this significant? The number of patients without health insurance increased to more than 12% at the end of 2017. In addition, Patient Balances after Insurance (PBAI) grew from 8% of the total bill responsibility in 2012 to 12.2% in 2017. The uninsured rate also grew from 10.9% in 2016 to 12.2% in 2017.

When healthcare providers focus too much on cost control measures, they are missing the bigger picture. As an example in 2018, cutting costs was the highest priority for 63% of hospital C-suite executives, according to a Premier survey.  But a recent Advisory Board study indicated that the typical 350-bed hospital may be leaving $22 million on the table by focusing on cutting costs over optimizing their revenue cycle.

Inefficiencies in the billing process is a huge problem in the healthcare industry but it also creates a massive market opportunity for new and existing healthcare payment tech players.

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