How to Handle Increased Patient Financial Responsibility

How to Handle Increased Patient Financial Responsibility

More and more payment obligations are falling to the consumer in today’s healthcare industry. Patients need to know up-front how much services will cost so they can determine how they will pay their financial obligations. Physicians, office staff members, and billing specialists should be aware of increased patient financial responsibility, and how this could impact the practice revenue cycle.


The TransUnion Analysis


According to a TransUnion analysis, patient out-of-pocket costs have increased by 22% from 2011 to 2017. TransUnion Healthcare is a subsidiary of the credit and information management services company. They analyzed data from 200 hospitals in the U.S. Based on an amalgam of patient co-insurance, co-pay, and deductible information for common procedures, they found that patients are paying more for healthcare than in previous years.


In the analysis by TransUnion, patient out-of-pocket costs for specified procedures went from $1,680 in the fourth quarter of 2011 to $2,050 in the fourth quarter of the next year. During this evaluation period, the average consumer’s total revolving credit remained flat, dropping by $100. In addition, the average consumer’s revolving balance fell about $700 in the same time period. Using a ratio of total revolving credit to patient payment responsibility, consumers have $2,050 in credit to make healthcare service payments for every $100 of healthcare costs in 2011. This number went to $1,680 in 2012.


So, what do these numbers mean for active healthcare providers? Price transparency is important for your patients, and billing specialists should have reimbursement conversations with patients before treatments, surgeries, procedures, and services are rendered. Evaluating velocity of growth on the patient responsibility is meaningful so the consumer can look at meeting credit obligations. Other TransUnion report findings include:


  • The average deductive for the patient has increased by 154%, from $400 to $1,050.
  • The consumers with higher credit scores will see an increase in available revolving credit, but those who are high-risk will have a decline in available credit.
  • The average co-pay a patient pays had gone from $65 to $125.


Tips for Office Staff and Billing Specialists


Because patients are paying much more than in previous years, healthcare workers must learn how to handle cost issues. Tips for office staff and billing professionals include:


  • Estimate and communicate – Before the patient has a treatment, procedure, or service, you should notify him/her of the financial responsibility up-front. This means having an honest discussion about the numbers. Create an environment that supports and encourages patients to meet their payment responsibility rather than one that causes defaults, delays, and billing problems.


  • Stop chasing the payment – The patient’s financial responsibility must be discussed before treatment is given. Office staff must collect a predetermined portion in advance, and explain that this is policy.


  • Train and anticipate – The office manager should ensure that all staff members are trained with communicating with the patient concerning financial responsibility. This could involve printed brochures, automatic payment plans, and payment portals. Regardless of the office payment system, all staff members should be trained on how to collect monies owed.


  • Keep up-to-date patient information – After services are provided, the billing specialist will need accurate addresses and phone numbers to collect the amount owed. It is important for the front desk workers to review this information at each patient visit, so the billing department can collect what is owed to the practice.

MPMR offers the top revenue cycle management for practices nationwide, with certified billers and coders to assist along with operational management as well!

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