By Jeannette Gontarek
The delivery of healthcare has evolved dramatically during the past three decades, and its slow change has brought the American patient to a place that currently demands patient responsibility in a faltering economy, with added pressure also on employers of potentially increased cost to cover their employees. This has caused the employers to be creative with options to offer employees that keep premiums lower for both themselves and the patients.
Beginning in the 1980s, many employed patients did not have to bear the burden of insurance costs. Fast forward to today with the antithesis: employers are now passing coverage costs onto the patient, with reduced benefits and higher co-pays. The combination of administrative costs, including healthcare regulation and malpractice lawsuits, also has contributed to the expensive delivery of healthcare to patients. Clinically speaking, there have been added safety and infection guidelines, mandatory continuing education requirements, facility credentialing, billing costs, and HIPAA policy. With increases in insurance deductibles and co-insurance, physician practices also are assuming more patient responsibility credit risks and escalating bad debts.
All of these changes have brought a growing category of self-pay patients that the healthcare industry must contend with: “self-pay after insurance” patients. These are patients whose individual contributions to their insurance have increased, or patients who have not yet met their deductible or are not covered for an expensive procedure, and therefore paying their bills after services are rendered has become too difficult. Radiology groups also are experiencing similar difficulties in their collections efforts, and the increase in patient responsibility, especially with the self-pay after insurance patient, is a relatively new phenomenon that has caught many radiology practices off guard. There has been a sharp incline in patient responsibility, and many self-pay patients in this category are now responsible for the same or similar dollar amounts as uninsured patients, in spite of being insured. In fact, based on client statistics from Zotec-MMP there are some cases in which traditional managed care patients have seen their patient responsibility portions increase by as much as 40%. This is why it is imperative that each group has the ability to track what percentage is being pushed to the patient on a month-to-month basis and year-over-year basis.
Hospital-based providers in particular have not been accustomed to educating insured patients about their plan coverage. Given the amount of money at stake, radiology groups are learning that change must come rapidly to accommodate this new payment population.
Practice Vulnerability Lies in Collections Strategies
As the percentage of self-pay after insurance patients increases, radiology groups are feeling the negative effects on their financial health as days in accounts receivable begin to rise. Groups also are seeing increases in the number of self-pay after insurance accounts that are turned over to collection agencies.
It may be surprising to learn that while groups do collect on some services from uninsured patients, in some cases collection percentages on the self-pay after insurance side are not much higher, which can translate into lost revenue. If collecting from a patient versus an insurance company, the likelihood is much lower that payment will be received from the patient.
In hospital-based imaging environments, upfront payment can be difficult or even impossible to achieve, but imaging centers have seen some success with this strategy. Upfront payment can have a very positive impact on the practice’s financial health, but this approach also can create bureaucratic difficulties from enhanced regulations on personal credit card information, and out-of-date insurance verification or allowable data can result in inaccurate quotes on patient responsibility.
In fact, insurance verification from the payor is usually most accurate at the time the request is placed and given high deductible plans and increased co-insurance amounts, verification timing is critical. It is not uncommon for carriers to adjudicate claims with a patient portion that varies from previously quoted rates simply because of other pending claims. This can create an increase in refunds from imaging centers collecting dollars upfront.
Also seen as a customer service issue, demanding payment upfront and subsequently refunding a portion may be perceived poorly by a practice’s community, which also could damage its reputation and create a sharp decline in physician referrals.
Customer Service Yields Process Improvements
Even though there are risks in collecting upfront payments, radiology practices can still improve the payment process for self-pay after insurance patients in an effort to maximize revenue—and it doesn’t include offering payment plans as an option, which surprisingly have little impact on the amount of money collected. In fact, Zotec-MMP’s clients have seen no increase in payment activity for trials that were completed and included payment plan options on patient statements.
Groups can improve collections by honing their in-house customer service skills when it comes to billing. Having accessible service representatives who can field patient inquiries, are knowledgeable about healthcare and radiology billing, and are willing to ask for payment are among the most important steps a group can take.
Groups also should analyze their patient billing statements, assuring clear yet brief language and terms. Patients typically complain that they receive billing statements that either are several pages long with too much information or are too concise and lacking appropriate detail. Statements should clearly delineate the amount that is the patient’s responsibility and why. Additionally, expectation for the payment due date needs to be stated clearly.
Practices also should offer online payment as an option. A large percentage of the population using the Internet to make payments do so after typical business hours and therefore having a payment website is critical.
In summary, radiology practices must become ingrained with customer service improvements that hone the billing process for the sake of their ongoing financial health. While more groups are improving their façade and reception areas with patient-friendly designs and greater efficiency, they cannot forget the impetus to help patients understand their bills and motivate them to make payments for services rendered.
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Jeannette Gontarek is a director of operations with Zotec-MMP.
