Why You Should Offer Patient Payment Estimates in Advance of Care
When your vehicle makes a strange noise or simply isn’t performing as it should, you’d naturally obtain a price estimate (maybe even two or three) before making the decision about what will be repaired and who will handle it. Why is it different for patients who need healthcare?
In truth, we have it backwards. Patients typically do not receive complete or accurate (or sometimes any) cost information prior to or at the point of care. While we would never allow a mechanic to work on a vehicle without a clear idea of costs, this very scenario occurs every single day in healthcare.
Except, it IS changing. Estimating accurately is hard, but new technologies are making it possible, easier, and more patient friendly.
If you're asking "why" you should look into estimating solutions, here are three good reasons.
Patients are demanding clear and affordable options
The most obvious reason to provide estimates to patients is that they will ask for them. 59% of consumers will choose a less expensive care option when comparing costs.
Consumerism in healthcare is increasing, and with the steady rise in high deductible health plans, patients are becoming more knowledgeable and are looking to become more informed about their cost of care. It’s the provider’s responsibility to not only provide exceptional healthcare but also to meet the patient’s financial expectations. Patients want to know what they owe, and they are typically willing to pay the fair amount for their medical expenses, but today, they are more likely to price shop for their healthcare.
But providing estimates comes with a hefty responsibility to communicate often and clearly with the patient. Especially as the cost of care has increase 195% from 1997-2016!
What happens when the estimate is different than the actual cost of care after the service is delivered? Well, be sure that every possible scenario — good, bad, or neutral — impacts the patient financial experience. If the estimate is low and the bill is high, the inaccuracy may be attributed to a variety of reasons: perhaps a portion of the deductible was previously paid, or the procedure performed differed from what was originally planned and estimated. If communication is strained between the patient, the care team, and the billing office, dissatisfaction can cause patients to lose trust in a provider.
Conversely, if the patient overpays, a credit balance may result on the account. While most people are usually relieved to find they owe less, credit balances create their own set of issues.
Providing an estimate is so much more than sliding a paper with numbers across the table. Hold a conversation, entertain the "what if" scenarios, answer any questions, and update the estimate any time the treatment plan changes.
Your organization will see an uptick in cash
The level of healthcare-related bad debt is rising quickly. Patients are often surprised to learn that they owe providers anything out of pocket. “Doesn’t/shouldn’t my insurance pay for this?” they ask. As a result, an increasing volume of patient balances transfer to collections.
The good news is that patients who are informed about their financial responsibility are actually more likely to pay. While this translates to fewer self pay resources used to collect on the back end, it’s also a sound reason to provide an estimate at the outset.
A patient payment estimator helps start the conversation about the out-of-pocket expenses a patient will incur. It allows healthcare organizations to potentially collect the balance, or a portion of the balance, owed in advance of the visit, especially for non-covered services. It also creates opportunities for your staff to discuss financial options like holding a credit card on file and setting up payment plans with the patient. When expectations are clear and options are provided, the likelihood of collecting payment increases.
You can use technology that doesn’t require more manpower
You can equip your pre-visit work team with technology tools to help with conversations surrounding patient responsibility. So how does it work? Estimating technology simplifies this process by quickly pulling data to calculate not only what the patient’s out-of-pocket responsibility will be, but also the patient’s propensity-to-pay score. This can be done long before the patient steps through the door, in turn eliminating touches to an account on the back end.
Additionally, estimating technology queries the payer website to check eligibility. This allows your representatives to ask for updated insurance information if necessary. The estimator is integrated with the host billing system and the payer so it is able to account for coordinated care. That is, future scheduled visits and current claims with the payer are considered in the estimate for patient responsibility, allowing for more accuracy of what the patient will owe.
The technology can even qualify patients for presumptive charity care much like propensity-to-pay technology, but prior to the visit.
The Bottom Line
Just as you are more likely to pay (and return in the future to) a mechanic who gives a fair repair quote, fixes your vehicle, honors the agreed upon price and builds loyalty with patrons, so is an educated healthcare consumer — who is not surprised by his or her patient balance — more likely to pay what he or she owes for the care you provide and return in the future.
Providing an estimate in advance of the visit, and clearly communicating the factors that may contribute to its variability will bring you steps closer to consistently delivering outstanding service and building a loyal patient base.