Healthcare providers are faced with ever-changing industry standards, regulations and restrictions. The presenters at this year’s New Jersey HFMA Annual Institute shed some light on three issues plaguing the industry under the current reforms, and offered various solutions to help providers not only to succeed, but to thrive in today’s environment.
In the first installment of this series we discussed how high rates of insurance denials can lead to a backlog of aged accounts and decreased AR, but how hiring or partnering with a properly trained denial management team can help.
In this article we discuss a problem facing all providers, and one that will continue to grow as more Americans sign up for high deductible health plans.
Issue #2: Rising Self-Pay AR
Less than 10 years ago patient responsibility accounted for only 10 percent of the cost of care. According to New Jersey HFMA Annual Institute presenters Ric Perez and George Wong from Passport, many providers are now seeing self pay AR of 20-30 percent. It is becoming apparent that under the reform, collection amounts on balances after insurance decrease significantly as balances increase, and providers are losing a significant percentage of their revenue to high past due balance amounts.
Solution #2: Improve time of service collections
Patients drive revenue. As a result, it is imperative that providers communicate with their patients about their responsibility in a timely manner and address their concerns. Making a connection with them prior to service and educating them on their coverage, eligibility and out of pocket responsibility will increase the likelihood of payment.
Perez and Wong shared the results of a survey that asked for perceived barriers to time of service collections. The survey was given to both medical office staff and patients. The results were as follows:
Medical office staff answered:
- Difficulty estimating cost of charges;
- Technology constraints;
- Difficulty getting staff to ask for money or staff lacks skills to collect; and,
- Difficulty accessing data from payers.
- Lack of financing options;
- Late receipt of statement;
- Confusion about amount owed; and,
- Healthcare is a right, not a privilege and I should not have to pay more than insurance covers.
Providers must take the time to understand the patients’ concerns and address them if they hope to collect even a portion of the patient responsibility piece. It is becoming increasingly important to connect with patients prior to service and to educate them on their coverage and eligibility so their balance does not come as a surprise. Additionally, providers also have the most control over collecting deductibles and co-pays prior to service while they still have the leverage. Applying this proactive approach requires well-trained, educated and empowered staff. For information on staff training and free collection resources visit Collector University.
Increasing patient responsibility leads to our third and final issue in this three-part blog series. Read our final post in this series for a possible solution to what is arguably the biggest issue plaguing your AR today: rising bad debt.
Written by Ali Bechtel, Public Relations Coordinator
This information is not to be construed as legal advice. Legal advice must be tailored to the specific circumstances of each case. Although we attempt to provide up-to-date information, laws and regulations often change. We make no claims, promises, or guarantees about the accuracy or completeness of this document. For legal advice, please consult an attorney.