Are You Efficiently Working Patient Statements?
According to the CDC, Americans with high deductible health plans increased by 50 percent between 2011 and 2016. As a result, patients are responsible for a higher percentage of their health care bills. Providers and facilities are reaping the results of this shift in financial responsibility. Analysis by TransUnion Healthcare revealed that two out of three patients do not pay their bills in full. By the end of 2016, 99 percent of hospital bills of $3,000 or more were not paid in full. Even smaller bills, those under $500, were not paid in full by year’s end by 68 percent of patients. How is your practice coping in this new healthcare environment? It’s critical that practices work smart to collect patient payments. One key way to do this is through an efficient patient statement workflow process. Here’s how.
What Your Patients Want
The first question to ask is, “are my statements patient-centered?” No one likes getting a bill. However, when we do we want clear information. What do I owe? Why do I owe it? How do I pay? Who do I contact with questions? If your patients can’t answer any of those questions within seconds, your statements are not effective. One recent survey entitled “Patient Payment Check-Up” discovered major disconnects in what providers think their patients want and what their patients actually want. Think about your patient statements in relation to these two key findings.
- Electronic statements are preferred. More than half (52%) of those surveyed prefer electronic billing, with even higher percentages among younger patients. However, almost 90 percent of surveyed providers are still mailing paper statements. Patients are paying everything from cable bills to car loans online and they expect the same automation from their health care providers. Making electronic statements available has several benefits for practices too. Staff can better respond to patient preferences, offering clear information about what they owe and how they can make an immediate payment. Secondly, patients get a perception that your practice is forward-thinking and patient-centered. Third, you’ll save by using less paper and lowering your postage bills.
- Timing perceptions differ. More than half the providers surveyed indicated that it takes the average patient more than three months to pay his or her bill. However, only 18 percent of patients think it takes that long. It is believed the discrepancy is because patients get so many statements in the mail. Patients may pay after what they think is the first statement when it’s actually the second or third. Electronic updates can eliminate this discrepancy. Patients can simply get an e-mail reminder that a statement is still outstanding. Some practices are further meeting patient needs by offering automated payments. Seventy-five percent of patients surveyed said they would be willing to provide a credit card number for the provider to keep on file and automatically charge fees up to a certain amount.
What Your Staff Needs
Patient satisfaction is one critical component to effectively processing statements. However, having a standardized patient statement workflow process for your staff is the second important piece. In order for effective collections, a standard process must be in place and adhered to. Before finalizing your process, answer these questions:
- Will statements be sent electronically or through the mail?
- Have we collected patient communication preferences?
- How often will multiple statements be sent, monthly or weekly?
- What is the maximum amount that can be considered a “small balance adjustment?”
- What is the minimum amount that qualifies a balance as “bad debt?”
- What is the minimum balance that should be sent to collections?
Your process will differ based on how you answer the above questions. Here’s a sample of how your statement workflow might look:
- $5 to $9.99 balance: Send only one statement according to the patient’s preferred method of communication. If unpaid, write it off as a small balance adjustment. Add a pop-up memo so that staff is alerted at the patient’s next check-in that the small balance is still outstanding.
- $10 to $20.99 balance: Send two statements. If unpaid, write it off as a small balance adjustment. Add a pop-up memo to alert staff to ask for payment at the next check-in.
- $21 to $25.99 balance: Send three statements. If unpaid, write off the balance as a bad debt adjustment. Once again, include a pop-up memo for staff to remind the patient about the outstanding balance.
- $26 or more balance: Send four statements. Add a “final notice” message to the fourth statement, and include a 10-day grace period. Send a personalized note if no response is received within 13-15 days after the fourth statement. The account should be reviewed at this point. If no payments of any kind have been made and the patient has not responded, add the patient to the collection log and make a billing note. It’s critical that these accounts are personally reviewed. An outstanding balance will still show on an aging report even if a patient has made a partial payment, or contact has been made and payment is en route. Not reviewing these accounts will result in patients unnecessarily being added to the collection log.
- $26.99 to $99.99 balance: Unless the provider has stipulated that all balances over a certain amount should be sent to collections, put the patient on a collection log for the provider to review. If the provider has decided that balances less than $50 should not go to collections, adjust the balance as bad debt and include a pop-up memo to remind the staff member to ask for payment on the next visit.
- $100 or more balance: Have a staff member personally contact the patient, specifically offering to set up a payment plan or offer payment options. If no contact is made, put the account on the collection log for the provider to review.
Managing collections is a delicate balance. Patients need clear information. However, being overly short and curt may be perceived as inconsiderate. Your phrasing must create a sense of urgency without frustrating the patient. One way of doing this is to change your phrasing with each statement. For example, softer language can be used in earlier statements, gradually increasing the firmness with later statements. Following a clear process will help your staff be more comfortable asking for payment as well. Let the experts at Agnite Health LLC help you find that balance in your process between patient preferences and staff needs. Contact us to learn more.