As the healthcare industry becomes increasingly competitive and consumer-driven, employing a proactive approach to patient collections will help ASCs remain successful.
Here are eight things to know about patient collections in ASCs.
1. Americans are facing higher deductibles and premiums than past years, leading ASCs to allot more time to patient collections. These payments may constitute a relatively large portion of a surgery center's revenue.
HealthCare.gov plan premiums jumped 25 percent, on average, in 2017. Arizona had the highest average premium hike for 2017 individual plans sold on HealthCare.gov at 116 percent.
2. A 2014 Navicure survey found patient revenue represents nearly $11 billion each year for ASCs.
3. For 38 percent of ASCs, patient revenue represents between 21 percent and 30 percent of total revenue. Only 9 percent of ASCs reported patient revenue comprised more than 41 percent of their total revenue.
4. Patient payment represents a growing percentage of ASC's expected reimbursement. This year it will be common for the patient to be burdened with a $5,000 deductible or more, according to Jho Outlaw, SVP of revenue cycle services for Birmingham, Ala.-based SourceMed.
In some instances the patient may even find themselves responsible for the entire bill, despite being insured. Ms. Outlaw states this cost shift, which removes a large portion of the financial burden from insurers and places it on the patient, has elevated the need for ASCs to organize a robust pre-registration process. This process must include a review of the patient's benefits so that the out-of-pocket expense can be estimated and collected in advance of services being rendered.
5. Price transparency is taking hold in the healthcare industry with more ASCs posting their prices online and being upfront with patients concerning their financial responsibilities.
"Patients must be educated on their financial obligations well in advance of their procedure," Ms. Outlaw says. "Beyond the fact that healthcare organization accrediting agencies requires advance financial counseling for all non-urgent procedures, it just makes good business sense. These discussions should include what the patient's insurance will cover, the patient's co-pay amount and any out of pocket fees. Providing this information early on will eliminate day of surgery surprises which can cause unnecessary delays or even cancellations as well as low patient satisfaction."
6. Employing both a consistent and proactive approach to patient collections will prove beneficial for centers to obtain payment.
"Many ASCs have lenient processes in place [for patient collections]," Ms. Outlaw says. "Simply sending a statement and assuming it will be paid is not enough. Centers must have consistent processes for managing statements, including when to turn accounts over to a collection agency. Consistent processes and thorough follow-through are essential to getting paid."
Ms. Outlaw notes it is nearly impossible to collect from patients a year or more following their procedure. She suggests centers send notifications to patients every 21 days for three months with escalating messages. For instance, the first letter would thank a patient for their business. The second letter would thank the patient again and remind the patient they are late paying the bill. The third message would tell the patient they are at risk of placement with a collection agency.
A couple of weeks before the 63-day cycle ends, Ms. Outlaw says centers should call patients. She recommends after three statements and a phone call, submitting the patient to a collection agency.
7. ASCs leave a significant amount of money on the table when they do not have a strong patient collection policy in place. Ms. Outlaw categorizes the types of centers she works with as either complacent or proactive. On average, complacent ASCs collect 20 cents on every dollar before the center goes to a collection agency. The more proactive centers collect 40 cents on every dollar before they go to a collection agency.
8. Some collection agencies offer a service to identify the patient's likelihood to pay. Ms. Outlaw has worked with collection agencies that use data analytics to stratify the patient's "propensity to pay" based on certain factors such as their credit reports and any prior history of healthcare debt. Based on these findings, surgery centers can quickly work with those patients who may have a lesser likelihood of following through with payments and suggest they participate in a financial assistance program.
Cost shifting has placed a significant burden on the patient and elevated the importance of collection. For those centers unable to effectively manage the process in-house, Ms. Outlaw recommends enlisting the help of an outside partner.
"Patient collection is a challenging job and requires a certain mentality to be successful. There are companies that specialize in the patient aspect of collections. These professionals are trained to work with patients on their financial obligations, including setting up payment plans and offering financing solutions," concludes Ms. Outlaw.