How High-Deductible Health Plans May Impact Your AR (and what you can do about it)

By Jill Heyden and Sara Greff Dannen

The high cost of healthcare has led to the onset of employers offering their employees high deductible health plans (HDHPs).  While the shift to these plans offers cost savings to employers, these costs have to go somewhere and they are mostly being shifted to the patient.  In 2003, a patient’s average deductible was $250.00, while in 2014, this average was over $1000.00!

This burden of rising medical bills affects more than just the patient - it affects everyone.  According to a recent publication from Healthcare Financial Management Association (HFMA), an Advisory Board analysis of 400,000 patient claims found that 68% of patients are likely to pay their share of care costs when the costs are between $500 and $999.  But as the balance of the patient’s bills rise, that patient’s propensity to pay quickly decreases.  The same study found that when patient bills are between $3500 and $5000, only half of the patients are likely to pay.  And when the balance tops $5000, just 36% are likely to pay their balances.

As a result of these findings, healthcare organizations are facing increasing challenges in collecting payments.  Having standard collections policies and financial obligation policies is necessary to continue delivering the best possible care.  To ensure that your organization is optimizing all its Accounts Receivable (AR) management possibilities, a few questions could help identify areas that may need to be improved on:

EVALUATE YOUR REVENUE CYCLE MANAGEMENT:

●       Do you check every patient’s eligibility for insurance benefits immediately prior to every service?

●       Do you have patients sign a financial policy to acknowledge what they are responsible for based on their payer type?

●       Do you verify patient’s insurance information, do you copy the patient’s insurance cards at every visit, or at least compare their current card to the card you have on file?

●       Are you authenticating everything that needs pre-certification, pre-authorization or pre-notification to be sure the service will be paid?

●       Have you recently audited your contract allowables to ensure you are being paid correctly?

●       Do you check recoupments or requests for refunds from payers and make sure they truly should be refunded?

●       Do you collect the patient’s portion of the service at the time of service?

●       Do you collect fees for elective services prior to providing services?

●       Have you determined if the reason of patient non-payment is because the patient is having difficulty understanding their EOBs or billing statements?

●       Do you make payment arrangements in the office for balances after insurance has paid by communicating all possible payment options?

●       Do you make it simple and convenient for your patients to make payments? 

●       Do you offer your patients the ability to pay online through your website?

●       Do you accept cash only from patients who have passed bad checks or have filed bankruptcy with your practice?

Sitting down and analyzing the questions above will give you a step in the right direction.  With the rise of patient out of pocket costs, everyone must do your part to ensure patient care doesn’t suffer, and AR balances do not get out of hand. 

Jill Heyden is the Business Development Specialist and Sara Greff Dannen is Legal Counsel at AAA Collections, Inc.in Sioux Falls.