3 Ways to Improve Patient Financial Experience and the Bottom Line
Providers are relying more on their patients for revenue generation and collection, making the patient financial experience a top priority for business leaders.
Patients have always been at the center of clinical care. But the same has not always been true on the business side of healthcare. Providers traditionally rely on insurers for revenue, making patient billing an afterthought. However, healthcare consumerism is transforming the business of healthcare by placing greater emphasis on patient payment collection and the patient financial experience.
Premiums for both family and single coverage are on the rise, causing individuals to pay more out-of-pocket to offset the growth in health insurance costs, according to the latest employer health benefits survey from the Kaiser Family Foundation.
The survey found that 82 percent of covered workers in 2019 had a general annual deductible for single coverage. For these workers, the average amount before the plan would pay for services a was $1,655, which represented a 36 percent increase over the last five years and a 100 percent increase over the previous decade.
Patients are feeling the pinch from high-deductible health plans and increased cost-sharing, but so are their providers. As patients became increasingly responsible for care costs, patient financial responsibility after insurance increased from eight percent of the total bill in 2012 to 12.2 percent in 2017, a 2018 TransUnion Healthcare analysis revealed. As a result, total hospital revenue attributable to the patient after insurance spiked by 88 percent over the five-year period.
To thrive in this changing economy, providers can no longer rely on the traditional business model. They must engage patients with the financial side of healthcare to protect the bottom line and deliver a valuable experience to keep them coming back.
Unfortunately, patient financial experience has not been a top priority for providers, evidenced by large volumes of manual patient billing processes, little to no price transparency, and limited patient-centered metrics tracked for performance improvement.
As patient out-of-pockets continue to rise, providers taking steps to meet patient financial needs will be the ones thriving in the changing healthcare landscape. Here are four strategies to improve the patient financial experience while safeguarding and futureproofing the bottom line.
Engage patients early in the financial process
Patient engagement is key to the success of population health and value-based care efforts. However, providers have fallen behind with creating the same high-touch experience on the business side of healthcare.
A recent survey of nearly 1,000 healthcare consumers found that only 27 percent of patients reported satisfaction with the healthcare payment process. Meanwhile, 74 percent of respondents said their providers had not discussed payment plans or financing options in the past two years.
Engaging patients throughout the medical billing process has not been standard procedure for providers, explains Carrie Moneymaker, MBA, vice president of solution design at Zotec. Providers have been good about identifying copayments and collecting that, but they have not taken steps to walk the patient through payment options, financing opportunities, and billing support.
“We're missing a link of communication between the patient and the provider about what's happening with a service, visit, or episode of care,” she says.
Creating workflows that direct both revenue cycle staff and providers to check in with a patient’s financial situation throughout the encounter’s journey is key. Implementing technologies that enable providers to view not just clinical, but also financial information also supports collection practices that benefit both the patient and the provider.
Provide price transparency to patients, providers
Three-quarters of patients research provider charges and expected out-of-pocket costs before heading to the doctor, a recent TransUnion Healthcare survey. However, only half of the patients reported access to clear pricing information.
Consumers are always looking for the best deal, and now that patients owe more out-of-pocket for their care, demonstrating value is key to revenue cycle success. Therefore, providers should make pricing information clear to frontline staff.
“Provide that transparency from the point of a scheduled service to the day of the service to full collection of the allowed amount,” Moneymaker advises.
Providers should also develop a strategy for making that information available to patients and consumers in an easily accessible and easy to understand format.
Potential patients need price transparency as much as established patients. While helping current patients understand their financial responsibility can boost collections, making pricing and quality information available to consumers in the market can attract new business.
Providers are already facing competition from urgent care centers, retail health clinics, and other new care settings that provide convenient access to healthcare. Providers must demonstrate value in the new consumer-centric healthcare industry. Providing pricing information – especially when competitors are not – is key to generating new business.
Deliver personalized experiences
High-deductible health plans and other cost-sharing arrangements are affecting a majority of healthcare consumers. Even Medicare patients are facing thousands of dollars in out-of-pocket costs for certain services, the Kaiser Family Foundation reported.
But just because most patients are facing higher healthcare costs does not mean providers should develop a uniform strategy. Providers must deliver a personalized financial experience in order to meet the needs of populations with different ideas of how they want their healthcare journey to unfold.
Leveraging propensity to pay tools is how consumer-centric providers are personalizing the patient financial experience, the Healthcare Finance Management Association (HFMA) says. According to its Consumerism Maturity Model, providers who have mature post-service communications use artificial intelligence and other technologies to calculate a patient’s likelihood of paying a medical bill and leverage the information to tailor financial communications.
Providing customized experiences allows providers to connect with patients on their level, which helps providers implement the payment and billing processes their patients want. This can enhance the overall experience to retain and attract patients.
These personalized, valuable financial experiences are critical to thriving in an evolving healthcare industry, especially one that exists alongside the age of the internet and online reviews. Failing to offer a satisfying financial process in addition to a high-quality clinical encounter can spell trouble for providers.
“We don't want that financial portion to interfere with the quality of the care that a patient received or have a patient upset with the revenue cycle side of the equation when they had great care,” emphasizes David J. Law, chief client officer at Zotec. “Patient experience is very critical to the success of the organization both from a financial basis but also from a care basis.”