Becker's Hospital Review

30 Executive Briefing How Billing and Collections Impact the Patient, and What Providers Can Do to Protect Their Bottom Line B illing and payment for medical procedures are often overlooked aspects of the patient experience and may be the reason many physicians are seeing increases in pa- tient complaints and their bad debt year over year. Confusing medical bills and frustrating collections process- es can derail satisfactory clinical experiences in the hospital or at a physician's practice. Disgruntled patients unsettled by complex bills — then collection letters and poor interactive voice technology phone calls — are less likely to understand their financial responsibilities, and subsequently, less likely to pay on time or at all. This is an increasingly prevalent problem, especially as in- surance carriers see more consumers enrolling high-deductible health plans, in which they are responsible for a significantly greater share of their healthcare costs. Since the advent of the health savings account in 2003, deductibles have increased as employers resist escalating premiums. According to the Kaiser Family Foundation, the percentage of covered workers with de- ductibles of $1,000 or more rose from 10 percent in 2006 to 46 percent in 2015 — a 360 percent jump. Among covered workers with a general annual deductible, the average deductible for single coverage in 2015 was $1,318, up from $917 in 2010. "The [greatest] impact today is the big shift from busi- ness-to-business healthcare to business-to-consumer health- care," says T. Scott Law, founder and CEO of Zotec Partners, a revenue cycle and practice management provider based in Carmel, Ind. He says the increasing prevalence of HDHPs has had "a material impact on the revenue cycle process," as these plans characterize a major shift in the responsibility to pay. Prior to this shift to high deductible health plans, the carrier would cover about 80 percent of medical expenses, according to Mr. Law. Now, with patients accountable for almost all of the first $1,200, bad debt is rising, according to public accounting and consulting firm Crowe Horwath's first quarter 2015 edition of its hospital benchmarking data. The Crowe RCA Benchmarking Analysis, which evaluat- ed 420 hospitals, showed as the number of HDHP enrollees increased from 15.5 million in 2013 to 17.4 million in 2014, insured patients' share of total uncompensated care increased dramatically, with bad debt up 22 percent and charity care rates up 130 percent in Medicaid expansion states. In non-ex- pansion states, bad debt and charity care rates rose 35 percent and 130 percent, respectively. These trends underscore the need for hospitals and physi- cian practices to implement solutions that can enhance the pa- tient/consumer collections process and safeguard the revenue cycle by making the experience easier for patients. To Create an Effective Billing and Collections System, Focus on Customer Service In essentially all industries outside of healthcare, companies ceaselessly strive to provide the best possible customer service. Healthcare lags substantially in that sense because previously, third-party payers paid the bills. From long wait times to spotty transparency into cost and quality information to incomprehensible medical bills, healthcare consumers commonly endure less than desirable experiences navigating the healthcare system. At the same time, they have grown accustomed to exceptional customer service in other industries and expect the same consumer-centric treatment in their healthcare. Mr. Law gave the example of Amazon, one of the most highly esteemed companies in terms of customer service. "On Amazon, you get prime service," he says. "Your package is delivered right to your house — fast. Consumers are expecting that kind of interaction with healthcare billing. If that provider can't give that experience, it reflects negatively on the overall experience." When an Amazon customer reports a problem, a customer service professional responds in a rapid manner, illustrating an emphasis on fulfilling consumers' demands for immediate help and highlighting Amazon's commitment to customer service. Unfortunately, that kind of timeliness is not common in health- care. When it comes to medical bills, which patients will likely have questions about, the lack of timely response can damage the patient's overall experience. Negative patient experiences can translate to reduced patient satisfaction scores in HCAHPS surveys, which ultimately impact reimbursement. Bad experiences can also lead to pa- tients not understanding or even avoiding paying their bills. Build a Foundation for Billing and Collections Grounded in Best Practices To prevent the billing process from tarnishing patients' experiences, healthcare providers must focus on two princi- pal strategies: managing patients' expectations upfront and empowering them to be more accountable for fulfilling their financial responsibilities, according to Mr. Law. Central to managing patients' expectations is present- ing the hospital or physician practice's billing department as professional, friendly and dedicated to providing the most worry-free collections process. Mr. Law says it is concerning "when physicians must oversee billing and collections duties on top of caring for their patients." These added responsibilities can have a negative impact on the overall quality of care, may contribute to a dimin- ished view of the practice overall and result in poor interactions between patients and staff. "I think [practices and hospitals] should be investing in training their people," says Mr. Law. "There should be staff who are there solely for collecting money and insurance informa- tion," as opposed to clinicians juggling these responsibilities on top of their clinical ones. However, in reality, many physician practices and hospitals Sponsored by:

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