Managing Self-Pays & Payment Expectations

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March 12, 2013 by Rick B

When I was a younger man I would worry about everything. The best advice I’ve ever gotten (or taken, I should say) is that you can’t worry about what you can’t control. Worrying about factors outside of your control is, at best, counter-productive. I’ve taken the energy I was spending worrying about what I couldn’t control, and repurposed that energy to factors that I could influence. My personal experience with this philosophy has been eye-opening; I’ve had less stress in my life and have been a more productive problem solver.

This story from my own life reminds me a little bit of what is happening in the world of healthcare. It is no secret that the healthcare industry is going through some changes. With changes come uncertainty and worries, it’s the natural way to feel. That being said, focusing on what is within our control can be the key to effectively navigating through uncertain times.

Enter self-pay collections.

Self-pay accounts are growing both in numbers and balances; the good news is you have control over how this will affect the bottom line of your healthcare organization.

The self-pay population has evolved and it is no longer as simple as it was in the past. At one point, self-pay patients were typically uninsured and often times indigent. Higher deductibles, larger co-pays, HSA’s, the Affordable Care Act, and increased Medicaid eligibility muddy the waters even further.

The changes in the health insurance market have created a population that generally does not understand how their benefits are coordinated with their healthcare providers. The fact is, many consumers are getting unexpected medical bills after a procedure is completed. Sometimes they are surprised because they assume their insurance covers the entire cost. Other times they are surprised because they don’t anticipate or understand when the cost of a covered procedure is applied to their deductible. There can be many reasons they are surprised, and it’s important to understand that these surprises can really affect the ability or willingness of the consumer to pay their portion of their bill.

In my opinion, the key to decreasing glitches in your self-pay receivables is through communicating with your patients. Constant communication and consumer education are keys to developing a healthy revenue cycle.

Here are 5 tips for getting better results on your self-pay accounts.

1) Ensure demographic and insurance information is correct every time you have contact with a patient. Studies indicate that over 25% of the demographic information is incorrect across the industry. That means 1 out of 4 patients you see may not be getting their bill in the mail so your cost of postage increases, furthermore an insurance claim that should be paid, may be rejected over an error as simple as an incorrect middle initial.

2) Prior to service, patients should be screened for eligibility in government sponsored programs. In January of 2014, the Affordable Care Act will make an estimated 23 million uninsured Americans eligible for Medicaid. It is crucial you get your eligible patients enrolled in these programs, because every dollar you can recoup from Medicaid will become increasingly important.

3) Patients should be screened for Charity Care eligibility before the time of service, not after.

4) A patients expected out-of-pocket balance for a procedure should be discussed prior to service. This prepares the patient, and alleviates any surprise generated by an unexpected bill.

5) Payment in full, or a payment plan should be initiated prior to service. Statistics show people are more likely to pay their mortgage, car payment, utilities, cable, internet, and even lawn care bills prior to their healthcare bill. Consumers need to be educated and trained to become better customers/patients. There is no one else out there; it is up to the healthcare industry to educate their patients.

The problem with self-pay accounts has been growing, and it is trending up. The good news is you have control, the sooner you can adapt your practices the better off your bottom line will be!

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