Posted by Alison Arthur on 06 Feb 2018
When a patient receives a bill from their healthcare provider, it can be filled with terminology they might not readily understand. Co-payments, co-insurance, and deductibles may create more confusion than clarity about what they owe, why they owe it, and when their balance needs to be paid.
Deductibles have reset for 2018, making it a critical time for patients to understand their financial responsibilities and the extent to which their insurance plans may (or may not) contribute. As patients increasingly bear more personal financial responsibility for their healthcare costs, it’s imperative that healthcare providers make their billing process as clear and actionable as possible.
The impact of high-deductible health plans
In a report published in 2017, the Centers for Disease Control (CDC) found that approximately 40% of American adults were participating in high-deductible health plans (HDHP). In the study, a HDHP was defined as a health plan with an annual deductible of at least $1,300 for self-only coverage or $2,600 for family coverage. For many individuals and families, these high upfront costs can represent a significant financial burden and may lead to collection difficulties for healthcare providers.
What are the critical components of effective healthcare billing?
So how can healthcare providers help clarify patient responsibility and improve their chances of collecting balances owed? Here are six critical components for healthcare providers to consider.
Component #1: Eliminate any confusion that it is, indeed, a bill.
Insured patients will typically receive two communications about the related service – an Explanation of Benefits (EOB) from the insurance company and a bill issued by the healthcare provider. The EOB typically includes the date of service, what was performed, who the provider was, the amounts allowed under the insurance plan, adjustments, deductibles, and patient responsibility. Although EOB statements are typically labeled NOT A BILL, sometimes they can be confused for bills. And conversely, sometimes provider bills can be confused for statements that don’t require further action.
Ensure that bills are clearly labeled with Amount Due, Due Date, and direct language like “You Owe” or “Patient Responsibility”. Work with a billing provider that can customize bills in a manner that increases the likelihood of being paid on time and in full. In particular, electronic billing solutions can provide the flexibility to send alerts and e-bills to patients directly, communicating with them in a manner that may increase their likelihood of taking action.
# 2: Make sure patients know what the bill is for.
For repeat patients, there may be confusion about which service or appointment the bill is related to. Clearly indicate the date of service, healthcare provider, and services performed so the patient has visibility into what they’re paying for.
# 3: Provide clear line items indicating patient payments already made (co-payments) and the insurance company’s contributions.
Make it clear to patients which credits have already been applied to their bills. This can help them understand what their insurance company has already contributed, make it easier to understand their personal liability, and help encourage on-time payments.
# 4: Present bills in the manner that patients want to receive them.
For some patients, paper bills might be their preferred method of corresponding with healthcare providers. For others, electronic bills may be more convenient. Paper bills can give patients the option to pay via check, write in their payment card information, or provide access to an online portal that supports one-time guest payments.
Electronic billing can cut down the costs of printing and sending paper bills, while giving patients access to an online portal where they can better customize and manage their accounts. By creating user accounts, patients can save their preferred payment methods (credit/debit card information and/or checking/banking account information), receive account alerts, get paperless bills, access old bills/statements, receive patient support, and customize payment options (one-time, recurring, autopay, and payment plans). Enrolling in an electronic billing portal can also give patients access to their accounts via mobile devices, making the experience even more flexible and user-friendly.
# 5: Give patients a variety of payment options.
Just as patients have preferences for paper bills vs electronic bills, they also have preferences for how they want to pay. Some like the convenience of paying on a credit card while others might want payments immediately withdrawn from their accounts via cash, check, or debit card transactions. Providing a billing solution that supports all payments methods – from walk-ins with cash to credit card transactions via mobile devices – may increase the likelihood of on-time payments.
# 6: Provide a helping hand for patients along the way.
No matter how much healthcare providers try to anticipate their patients’ needs, patients will still have questions regarding their billing statements. Providing easy access to helpful support specialists (both online and over the phone) can help patients better understand their bills and encourage them to make timely payments.
The Bottom Line: Healthcare bills can be confusing and patient payments are an important revenue source for healthcare providers, especially when yearly deductibles reset. Help increase the likelihood of on-time payments by providing a billing process that is clear, patient-centric, and backed by knowledgeable support specialists.
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