In an era of high-deductible health plans, physicians are constantly looking for ways to enhance patient collections. What’s one of the most effective strategies? A well-written and easy-to-understand patient billing statement. When designed correctly, this treasure-trove of information not only educates patients about their own insurance coverage and out-of-pocket costs, but it also inspires them to pay promptly.
Striving for greater transparency
Designing a more effective patient statement has been on the Department of Health and Human Services’ (HHS) radar for a while. In May, HHS announced its “A Bill You Can Understand” design and innovation challenge", the purpose of which was to encourage healthcare organizations, designers, developers, digital tech companies and other innovators to “design a medical bill that’s simpler, cleaner, and easier for patients to understand, and to improve patients’ experience of the overall medical billing process.” There were 84 submission from a wide range of comapnies, including Kareo.
Although innovative solutions may help ultimately help foster better patient engagement, for now, many physician practices continue to struggle with the patient statement process. Those that try to manage this process internally oftentimes find themselves up against these three basic challenges:
- Designing a user-friendly statement that prompts payment—not discourages patients to disregard the bill
- Sending the statement as soon as the patient balance is known—not waiting for a batch cycle 20-30 days later
- Planning for costs associated with generating and sending statements (e.g., postage, printing supplies, and staff time)
Five tips to consider
Consider the following five tips to better manage patient statements:
- Include plain-language explanations. Patients are more likely to pay bills that they understand—and ignore the ones that confuse them. Clearly spell out the following information:
- Physician’s name
- Practice contact information and office hours
- Service rendered
- Date of service
- Amount the insurance paid
- Amount due from the patient
- Payment options (offer as many as possible—credit card, debit card, or check)
- It’s also helpful to use a variety of fonts, colors, and other section headers to make important information stand out.
- Send patients statements as soon as you receive the Explanation of Benefits (EOB) from the insurance company. The longer your practice waits to send the statement, the more likely patients are to question or even forget the services they received—and thus, the less likely they may be to pay.
- Consider sending an electronic statement before you generate a paper version. Some patients may prefer an electronic statement rather than a paper one. Ask each patient for his or her preferences. Electronic statements cater to the growing trend of consumerism in healthcare—and they reflect a growing movement toward what PricewaterhouseCoopers, LLC terms a ‘new health economy.’ In a 2015 report, PWC summarizes this new economy quite effectively:
“The nation’s healthcare payment system is an artifact of an earlier age, focusing for decades on perfecting business-to-business functions. American consumers were patients, not purchasers. This is changing rapidly as individuals shoulder more of the cost of their own care. The healthcare billing and payment model must change as consumers demand systems that reflect the mobile, one-click reality of their lives.”
Industry statistics echo this push for electronic healthcare billing. Forty-eight percent of consumers said that they to pay their healthcare bills through an online channel, according to a 2015 survey about trends in healthcare payments. Seventy-seven percent of consumers said they find it easier to pay and track all bills if they do it digitally instead of through the mail, according to recent data from ConsumerCredit.com.
Patients who open an electronic statement should be able to review the balance and make an easy and secure payment online through a payment portal. The patient payment portal lets your practice accept debit and credit card payments and delivers those payments directly to your bank account. This is a win-win scenario because it gives patients what they want, and it also cuts down on postage and printing costs while accelerating cashflow to the practice. If the patient doesn’t open and react to the electronic statement, automatically generate a print copy for mailing.
- Set clear parameters. If a patient hasn’t responded by the time you send the third statement, consider turning the account over to a collections agency. Some practices terminate their relationship with the patient if the account remains unpaid after a certain period of time. If you decide to do this, ensure that you can flag these patients within your practice management software so front-office staff members know not to book future appointments.
- Consider working with an outsourced vendor. Regardless of whether the vendor manages the entire billing process—or simply generates billing statements that internal staff members ultimately print and mail on their own—these companies are typically able to help practices save money, recoup patient balances in a timely manner, and increase patient satisfaction.
For ways to improve patient collections, download the guide 5 Steps to Perfect Patient Collections.