Recently I was asked to help promote, ConnectPlus® as a A/R resolution tool for the healthcare and commercial market spaces. My personal knowledge of the healthcare space is pretty extensive as I have broken damn near every bone in my body at one time or another and find ways to have multiple surgeries about every 10 years (5 in 20 years, for those who care). My professional experience is pretty extensive as well, but not specifically on patient statement services and aged receivables.
So as you would expect, I needed to do some industry research and develop an approach to attack the market. Fortunately, my business mentor is also the business colleague that asked me to help with this market promotion. As it is his way, he started sending me some information and I started to read and absorb. However he could have stopped after the very first document. After reading the "Trends in Healthcare Payments 2015" and sitting in on a few client discussions about the need for some management tools for aged receivables, I was blown away about the need for a structured way to collect payment from the payee/patient.
Here are some of the simple trends and statistics that were mindboggling.
- Over the last 10 years healthcare premiums have gone up by 83%
- The deductible amount has risen by 255%. This statistic encompasses consumer payment responsibility, all out-of-pocket amounts before the health plan covers any portion of the service (deductibles, co-payments, co-insurance, etc).
- 76% of treatment recipients do not understand what they have to pay.
- 70% of providers have a patient balance outstanding in excess of 30 days.
So in very simple terms, healthcare agencies are having to chase down the payment for services owed from patients rather than insurance companies and the patients don't have any idea what they have to pay and why they have to pay so much.
The increase in access to payment portals and digital methods of payments has helped some of the tech savvy patients reduce the days until collection, but this does not help everyone.
As a consumer, I rarely pay the first invoice I get from a medical facility. Maybe I had gotten used to the first bill being incorrect too often, or awaiting insurance adjustment. However that trending is going away, since the proverbial buck has passed to the patient, normally your bills are accurate from the beginning.
Another aspect of business has added to the amount of patient accounts being sent to collections, which is painful for both patients and providers. (A patient does not want to be chased by a collection agency and the provider loses 25-30% of what they are owed.) Is the consolidation in the marketspace. Maybe as a byproduct of the Affordable Care Act or maybe just the nature of business, large healthcare organizations are taking over the smaller independent organization or those smaller groups are banding together to provide economies of scale.
How does this affect the collection rate of patient statements? Very simply if you take over, merge or band together all the underlying companies use different processes and systems or software. When it comes to collections, the information could reside in 2, 3 or more different software packages bought throughout the years. All these systems dump data, which is then normally put into a spreadsheet and the A/R departments then start make a call or two before turning it over to a collection agency, but each business unit handles the process differently.
I could be wrong about some of my assumptions, but I doubt it. I am relatively new at this, but a solutions seems pretty simple....find a company that has found a way to combine, clear and concise patient statement services with a A/R tool that will provide visibility and reduce your "aged receivables" in a cost effective manner to help drive revenue to your bottom line.