During the past decade, patients have taken more responsibility for directly paying their healthcare costs. A study from Instamed in 2015 showed that nearly three out of four providers reported a spike in patient financial responsibility. For hospitals, doctor's offices, and other healthcare organizations, this means successful collections from patients is more important to the revenue cycle than ever. Simply relying on CMS and private insurance payers to generate all the cash flow required to support operations is no longer feasible.
Collecting directly from patients comes with many challenges. A McKinsey & Company study found that healthcare providers expected to collect only 50 to 70 percent of patient balances after visits. The study also showed that 70 percent of providers waited at least a month to receive payments in full. Fortunately, there are four distinct tactics providers can use to increase the success of their collections:
1. Simplify Medical Bills
Due to complex medical language, confusing calculations, and unclear payment methods, many patients find medical bills needlessly complicated. Bills that are complex tend to have less priority than ones that are simple. Providers can solve this problem by designing their invoices to be as transparent and easy-to-understand as possible. They should clearly state, how to pay, how much is owed and what services are included. In order to help providers reach this goal, the Department of Health and Human Services (HHS) started the “A Bill You Can Understand” challenge. The challenge is designed to "put patients at the center of their healthcare."
2. Offer Electronic Payment Options
People buy everything from clothing and electronics to airplane tickets and hotel rooms online, so giving patients the option to pay their bill electronically only makes sense. Unfortunately, many providers have stuck with the old way of doing things and only allow payment by mail or phone. According to a Navicure survey, only 35 percent of providers keep their patient's credit cards on file, and 57 percent said they did not send statements to patients electronically. Despite these number, a vast majority of people expect electronic payment abilities from their healthcare providers. When patients have electronic options, they will be more likely to make payments.
3. Provide Transparency and Education
Even though patient financial responsibility has spiked in recent years, many individuals and families don't realize that the low premium plans have high deductibles. That's why providers need to to communicate openly with patients about their bills. Before care begins, providers should explain their billing policies and discuss what to expect in terms of costs. Patients who know their financial obligations going into the healthcare process will feel like they're getting true value for the money they're spending. They'll also feel confident that the billing process is honest and straightforward.
4. Outsource Patient Collections
For many providers, bill collections take a back seat to actual patient care, creating revenue cycle problems. The way to address this issue without hiring more staff or diverting existing personnel away from patient care is to outsource billing. Professionals at a collection company can use optimal tactics to collect while nurses, doctors, and other caregivers can focus on what they do best. A good outsourcing company will maintain a positive provider-patient relationship by taking an amiable approach that avoids pressure tactics. When outsourcing works correctly, it increases both patient satisfaction and revenue.