Provider Insights: Common Obstacles in Patient Collections

Provider Insights: Common Obstacles in Patient Collections

Medical practices are collecting more of their balances directly from patients. This is fueled by an increasing number of people with high deductible insurance plans. For example, 90% of the 12.7 million insurance exchange consumers selected high deductible health plans. These plans come with lower monthly payments but higher costs when patients visit your practice. 

Patients struggling to keep up with rising medical expenses may have challenges paying their bills on time, resulting in slow receivables and bad debt. This creates unique cash flow challenges for your practice. Fortunately, understanding common obstacles to patient payment collections helps you put strategies and engagement tools in place to proactively help patients pay their bills and reduce the risk of slow receivables. 

Patients are struggling with a lack of transparency 

There are very few industries where people don’t ask about the cost before engaging in services. In the past, a patient may have paid a co-payment without knowing the exact cost of care because the insurance provider picked up the remainder of the bill. With more people having a high deductible insurance plan, the landscape is changing fast – more patients want to know the exact cost of care upfront. They don’t want to feel surprised when receiving a bill, especially since that bill is likely out of pocket. 

According to a report published by PwC, “A short time ago, it would have been unthinkable for American health systems to publicize how much they charge for medications and medical services. But now, most Americans are facing higher deductibles and other cost-sharing measures.” 

One survey showed that 90% of consumers want to know their financial responsibility before having a procedure. As a result, practices need to work to build greater transparency into the patient-provider relationship. There are various reasons why patients aren’t paying their medical bills, and many are tied to transparency issues, such as: 

  • The bill is more than expected 
  • The patient believes there is an error on the bill 
  • The patient doesn’t have enough saved to pay the bill

The solution to these challenges is to be upfront with patients about the cost of care and provide an accurate cost estimate before services are rendered. Tools like ClearCalc enables you to check a patient’s eligibility and analyze their benefit plan with a real-time payor fee schedule to project the patient’s out-of-pocket costs accurately. Engaging in a discussion about the cost of care upfront also allows you to better understand if the patient will have difficulty paying their bill. If so, you can educate the patient about flexible and personalized financing options available through your practice. 

Many practices aren’t offering patient financing 

Practices that don’t offer patient financing may face more slow payments and unpaid receivables. Over half of Americans delay or don’t pursue healthcare because they can’t afford it. What’s more, 10% of Americans with children under the age of 18 have delayed care for a dependent or child due to financial issues. In fact, 40% of American adults can’t afford a $400 emergency

Patient financing empowers your patients to create a game plan to pay for care. A financing program helps you open your doors to more patients while simultaneously speeding up the payment collection cycle. As a result, you can reduce the number of slow payments, minimize bad debt, and start getting paid faster. Patient financing offers a variety of benefits from the patient’s perspective, including: 

People understand financial responsibility and are empowered to select a repayment plan. The slightest uncertainty will stop some patients from seeking care, which may have negative health impacts. Discussing the cost of care upfront and giving patients access to financing options eliminates uncertainty and encourages people to seek care when needed. 

Financial stress is minimized. Paying for care can be a stressor for many patients when they are paying out of pocket. Patient financing reduces this burden and helps people seek care with less stress and worry. 

Allows patients to tap into a reasonable interest rate and terms. Some programs, including patient financing offered by ClearGage, allow you to specify the patient’s financing terms and set your own term limits and interest rates. A practice can even decide to offer 0% financing options if desired. This helps the patient avoid putting medical bills on a high-interest credit card, which can exacerbate stress and worry. 

Time-consuming inefficiencies take away from patient care and engagement 

Reaching out to patients on the phone isn’t always necessary, and many patients prefer to receive text messages or emails. For example, you might have a staff member responsible for following up on outstanding patient balances. Automating these processes with patient engagement technology and communicating with patients through their preferred communication channel enables you to free up valuable staff time. What should you look for in patient engagement solutions? The best solutions:

  • Allow for customer communication preferences. The system should connect with patients using their preferred communication type, whether that’s text, email, interactive voice response, or speaking with a live person. 
  • Enable strategically timed messages at critical touchpoints. Personalization is increasingly important in healthcare. Communicating the right message to patients at the right time can make them feel more known by your practice and improve patient satisfaction. Select a platform that helps you send strategic messages along critical moments of the patient journey. 
  • Are designed to speed up cash flow. Slow payments and bad debt can quickly become a drain on your practice, preventing you from investing in new equipment, hiring new staff, and making other strategic investments. The right platform will help you increase practice revenue and improve cash flow while keeping patients engaged. 

When considering a patient engagement platform, it’s also important to connect with digital payment options. More of your patients are accustomed to paying for services digitally, and they want that same experience with your practice. Providing this will help you collect more revenue upfront while meeting patient expectations.

Patients struggle with confusing payment systems

Most patients (68%) want their medical practice to provide digital payment options. And even more of those patients (80%) want to pay their healthcare provider over the internet. However, the majority of practices aren’t currently meeting this need. Only 20% of patients reported they are able to make online healthcare payments with their practice, and 86% are still receiving paper statements. So, how can medical practices do a better job of meeting this need and speeding up payment collection cycles? The key is to give patients the tools they want to get you paid faster. Here are a few recommendations. 

Provide patients with automatic payment options. Many patients have a “card on file” set up with retailers and other service providers. For example, people shop online, order groceries, and even pay for haircuts without ever pulling out a credit card. Consider allowing your patients to leave a card on file to pay an outstanding balance after insurance adjudication. 

Deliver digitally enabled experiences. People increasingly want “touchless” transactions, and you can provide that through your patient’s smartphone. For example, imagine sending the patient an email or text that allows them to pay for services or set up a payment plan instantly. 

Implement payment plans. Many patients can’t pay their entire balance at once and need to break out the balance into smaller payments over time. By enabling digital payment plans, patients can set up a plan directly from their cell phones. 

Consider housing your entire platform, including patient financing, estimates, payments, and engagement, using one system. Doing so allows you to provide your patients with a streamlined and consistent experience that improves efficiency internally while reducing risk for slow payments and bad debt. 

Providing your patients with the resources they need most 

The patient’s need for financial resources and tools is only expected to grow in the future as more people adopt high deductible insurance plans. The growing trend of people paying more out of pocket for care isn’t expected to slow down soon. And in order to better serve your patients and protect your cash flow, it’s essential to set patients up for success from the start. 

Empower patients with the tools they need most, such as patient financing, digital payments, and consistent and helpful communication. As a result, patients will feel like you truly understand their worries about paying for care and that you’re a partner in giving them access to the care they need most while considering the cost.