Now more than ever, consumers are in charge of their healthcare. With consumerism continuing to make inroads patients are demanding choices and transparency in order to make informed health care decisions. The truth is—costs are rising and so is the patient financial responsibility.

The Centers for Medicare & Medicaid Services project that national healthcare spending will grow at an average rate of 5.5% per year from 2017 to 2026, or one percentage point above the rise of gross domestic product each year. Healthcare’s share of GDP is expected to reach 19.7% in 2026. What patients will—and already do—spend on healthcare is frankly unsustainable, as are the costs to operate against the current rate of reimbursement. As this industry summary demonstrates, patients are becoming a larger portion of the payer mix, but pay at a much lower rate and at a higher cost-to-collect.

In order to survive, and more hopefully thrive, as these trends take hold, revenue cycle leaders will need to put themselves in the shoes of their patients. New strategies must be implemented not just with patients in mind, but driven by patient demand, and with patient input along the way.

We will seek to provide further insight into the four themes below:



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    Chapter 1
    Trending Self-Service: Meeting Patients Where They Are

    Ask any healthcare leader what they see when they look into the future, and the common thread—including the most forward-thinking health systems in the country—is self-service. There is a general feeling that self-service will eventually overtake one-to-one exchanges.

    Perhaps a patient could schedule and pre-pay online, check in at the time of care at a kiosk, scan an identifier to enter their designated room, and not interact with another live person until their doctor enters the room.  Sound familiar? This is essentially how one boards a flight at the airport, and as an industry, healthcare continues to look to for inspiration.

    Patients are demanding this type of experience today, and will likely do so with more fervor tomorrow. At the same time, healthcare is vastly different than other industries. While prices do fluctuate for plane tickets, once you pre-pay, you will not be charged more or refunded if they go down later. It remains difficult and is at times impossible to predict an exact amount prior to services since clinical care can change course suddenly, and because an immense variety of third-party payers are also involved.




    There is also a lot providers simply do not tell patients. They are often unaware of the need for pre-authorization, or medical necessity checks, they may not even know their insurance has expired, and we also never utter the word “denial” to patients. This is to say that, even if the process of accessing care might be fully automated from the patient perspective, it will still require staff behind the scenes making sure all the necessary steps are carried out. It also assures that there will still be delays, uncovered services, and questions to sort out.

    Patients also want choice—the ability to start with self-service, but pivot to a live interaction when complications arise. For the unforeseeable future, patients will require a live staff member to call on when they do not understand their estimate, or when it does not appear their insurance approved the service.

    In reality, an assortment of communication modalities is the future of the front-end or back-end customer service, more so than a fully self-service model.  Knowing this, where are we currently as an industry in terms of self-service?

    1. Demand for Self-Payment Options Still Outpaces Growth

    Generally speaking, demand for online and mobile bill pay has outpaced the rate of healthcare organizations offering these options. InstaMed’s Trends in Healthcare Payments revealed in 2016 that 71% of patients normally pay their other monthly bills online. Its 2017 study revealed 65% of patients would use a mobile application to pay their healthcare bills. HBI data from 2018 shows that while 78% of organizations have online payment options, only 28% offer mobile bill pay.

    Furthermore, another industrywide survey conducted by HBI showed that online collections on average made up 17% of the typical organization’s total patient cash collections, with top quartile performers collecting closer to 25% of patient cash online. Organizations experienced with online payment emphasize that while larger balances did make up a part of these results, more balances of $500 or less were resolved through this modality.


    What this might suggest is that otherwise unpaid balances could be resolved at an increased rate through the help of online notifications and payment avenues.

    2. Still, Online Options Are Extending Well Beyond Bill Pay

    Even though not all organizations have taken the leap to online bill pay—and even less to mobile bill pay—those that do are continually expanding available features. Today, these portals and apps often include the ability to view medical records or lab results, find or establish contact with a doctor, evaluate ED wait times, and way-finding.

    chapter-1-img-3In other cases, patients may be able to schedule appointments, pre-register for services, update insurance or other demographic information, fill out consent and other necessary forms, provide feedback, or initiate telemedicine appointments.

    NOTE:  Because patients are often confused with how fragmented their clinical services can be, and as the industry looks to move toward a more comprehensive approach to care, it is important that all such features are offered through a single application.

    Perhaps the newest online feature in practice today is self-arranged payment plans. Patients can sign on, and map out monthly payments—the amount, the date it is applied, and their total repayment period. Of course, the organization often develops thresholds so that certain balances are resolved within a certain maximum timeframe (e.g., 24 months) or that minimum monthly payments are maintained (e.g., $25). In some cases, this may also allow for automatic deductions from a patient’s bank account.

    Organizations have found that only allowing payment plan arrangements by phone is often seen as inconvenient for patients, and that requiring them to admit the need for financial help may actually dissuade utilization. In fact, one Midwest health system found self-arranged payment plans increased online payments by 140%, increased payment plan utilization by 200%, and reduced back-end customer service calls by 50%.

    More payment plans will inevitably mean higher accounts receivable, but organizations are adjusting their expectations around A/R as they acknowledge that patients simply need more time to resolve their balances. They also recognize that this means less dollars paid to an external collection agency in the long run, and reduced cost-to-collect overall.

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    3. Front-End Self-Service Requires the Most Manual Intervention

    In nearly all cases for front-end self-service options, staff are still heavily involved in the process. In the case of self-scheduling, online pre-registration, and price estimation, patients are initiating the function, but technology does not yet allow for the automation desired. Staff must verify the information entered, enter it into the electronic health record, and call the patient back to finalize the end result. Even with check-in kiosks or computer tablets, organizations have found that they do not provide the return intended unless there are staff posted near them to help new users.

    What appears to be more effective with self-scheduling is allowing patients to pick up cancelled appointments. In one case study conducted by HBI, an East Coast provider allows patients to enroll in an app that notifies them of women’s services appointments cancelled within 24 hours. Not only can patients schedule appointments sooner, but it helps reduce revenue losses related to no shows.

    Pre-registration similarly works better among certain services than others. Some organizations pilot online pre-registration with maternity services or scheduled surgeries because they are planned in advance and easier to financially clear. What may be a misconception here is that this will reduce needed staff resources. On the contrary, some organizations need staff to help verify and confirm information, follow up with patients, and ensure subsequent processes are carried out. In addition, self-service in this arena requires patients to be knowledgeable about their insurance plan, the services they are seeking, and terminology like “deductible” and “guarantor.” And as any revenue cycle leader well knows, these are the quintessential points of initiation for any encounter. The information obtained and recorded here is what sets everything in motion, and what often determines the end result.

    The same is true of self-estimation. More and more organizations are housing patient-generated estimation tools within their patient portals. These tools start with posted charges and/or historical claims data, but must include contract terms (which are continually changing), and necessitate patients apply their specific insurance plan and service. Though, healthcare providers have found this to be popular among patients—one organization noticed a 92% increase in online estimates after adding a self-service option.




    Chapter 2
    The Changing Patient Payment Paradigm

    There is no denying that insurers are still the majority payer—historically making up 90% of revenue collected for the average hospital or health system, according to various industry sources. More recently, however, this statistic is closer to 70% of revenue, with patient-collected revenues nearly tripling from 10% to 30%.

    The culprit is easy to identify: increased cost-sharing between patients, employers, and insurers. Considering deductibles alone, patient out-of-pocket costs have approximately quadrupled within a single decade. While more individuals have become insured under the Affordable Care Act, the growth in the underinsured rate means patients still often have large out-of-pocket balances. According to the Commonwealth Fund, 28% of adults who were covered for a consecutive year were underinsured (with out-of-pockets equating to 5-10% of income, depending on circumstance) in 2016 compared to 12% in 2003. Of those who purchased coverage on ACA health insurance marketplaces, 44% were underinsured.

    Compounding these trends is the overall rise in healthcare costs. The Institute of Medicine, recognizing these trends in 2009, has provided alarming points of comparison. If other commodity costs had risen at the same rate of healthcare since 1945, we would be paying upwards of $55 for a dozen eggs or $134 for a dozen oranges. But this isn’t just costing patients. We all know that collecting from patients cost providers more time and resources—with only one in three patients resolving their hospital balances in full. This has led to uncompensated care once again rising in 2016 to $38.3 billion, after a three-year decline.

    So, what are organizations doing to collect while maintaining patient satisfaction?

    1. Consider Patient Preference, Not Just Propensity to Pay

    Organizations are still often prioritizing accounts based on balance, and may not be tailoring their approach to the patient’s ability to pay, their historical payment behavior, or their preferences. Propensity to pay strategies do help in this regard, but it is important to consider the extent to which they are applied. Is your organization only evaluating which patients are able to pay instead of how they pay? How does this inform your staff work queues?

    Propensity to pay needs to be more dynamic and multifaceted than simply determining whether a patient has the means to pay, and even if they are likely to dedicate resources to their medical bills. Forward-thinking healthcare organizations are harnessing historical payment information to truly tailor statements and follow-up to specific patient preferences. If a patient typically pays in full within 30 days if their balance is under $1,000, no additional effort may be needed. However, if they typically opt for a payment plan when they owe more than $1,000, statements may instead ask for a monthly installment and/or an outbound call would seek to add this balance to their current plan.



    Ultimately, such tools will allow organizations to better identify patients in need of financial assistance; inform staff in real time of which payment options to discuss with patients and what type of language to use; classify self-pay from charity care, Medicaid, or other funding sources; as well as strategize which accounts are truly worth an external agency’s contingency fee. The result has shown to be millions of dollars in converted funding and reduced collection and outsourcing costs.

    2. Build Trust

    Ultimately, effective collections come down to building a positive rapport, and building patient knowledge of both the billing process and the bill itself. Understanding can promote a willingness to pay, much like a positive last impression. First, patients’ bills should use layman’s terms to describe any charges. Patient statements often include outdated language from when payers were paying 90% of all balances—this needs to change. Many organizations are doing away with CPT or chargemaster references and developing an internal, simpler lexicon. Others utilize software to analyze statements in terms of what might be confusing to patients. Some analyze font size and type, color and graphics, and language used in statements to promote clarity.

    3. Become A Voice in the Community

    In the hopes of getting out ahead of an explanation of benefits, bill, or even an estimate, some organizations are holding town halls or classroom sessions on how to understand insurance benefits, how the billing process works, or frequently asked questions. These explanations can also be included in patient-facing newsletters or magazines, or broken down and sent in a shorter brochure to each patient expecting a bill. One approach here, too, is assigning patients with a certain balance level (say $10,000 or more) a financial advocate to hold all financial conversations. A review of hospital and health system websites also indicate more video tutorials are cropping up to teach patients how to engage with their provider on financial topics, and how to navigate the financial experience either on their own or with the help of a representative.


    Chapter 3
    Mining Feedback to Drive Improvement

    The way in which healthcare leaders are assessing their business operations is rapidly changing. No longer can a core set of financial metrics simply be reported and used to determine areas of improvement. A wide disparity still exists between standard reported metrics and patient perception. You may have above average collection rates, but does that tell you how many patients have been driven away by the billing process?

    1. Record Call Reasons

    Organizations are only in the very initial stages of innovating new metrics to measure the patient financial experience despite studies showing the impressions made upon patients before and after clinical care prove much more lasting than during care itself.

    In order to begin collecting data in this respect, some organizations have started requiring call center staff to manually record the reasons why patients are calling in with complaints and/or questions. In some cases, certain reason codes are applied within the patient accounting or EHR, much like a denial reason code, to help build patient-focused reports. In more sophisticated examples, providers are seeking the assistance of external vendors with call mining technology to help convert call recordings into data that shows, for instance, how many times patients thanked a representative, asked to speak to a manager, or how often scripts were followed. Not only does this provide significant intelligence into what patients want, but some of these same organizations have dedicated a position to following up with patients on more serious complaints in the hopes of turning these interactions into a positive outcome.

    2. Go to the Real Source: Patients

    Of course, patient surveys on both pre-service (first impression) and billing (last impression) are becoming quite prevalent to help gather a well-rounded picture of patient satisfaction. Leaders are even beginning to include these survey results as part of annual evaluations of both front-line and managerial staff. In their most effective state, surveys may help to segment perception by patient type, service, and more.

    Asking for key details regarding what the patient owed, whether the balance was outstanding, insurer and health plan type, and any financial arrangements they made will ultimately help to understand what is normal for patient satisfaction and how it might differ based on circumstance.

    Further, these surveys may help to set initial goals and perhaps baseline performance for revenue cycle leaders. As examples, ensuring at least 85% of patients felt their bill was accurate, and 90% of patients experienced one-call resolution with customer service.



    In this respect, leaders may be able to uncover the link between patient payment and patient financial experience scores—for every percentage point that satisfaction increases, payment can be expected to increase by how much?

    One Idaho-based organization with such a survey was able to determine that patients who rate an organization on the low end of the rating scale end up costing five times more to service overall.

    3. Explore Social Listening

    While the above strategies have proven effective in aligning strategic planning and initiatives to the betterment of patient satisfaction, they take time to gather, collect, and disseminate. For that reason, more and more organizations are investing in social listening procedures. It is no secret that social media sites can be leveraged to better understand how patients, in their own voice, feel about your organization. Solutions do now exist that are able to segment, based on keywords, which steps of the financial experience patients are talking about and what their sentiments are.

    4. Consider a Real-Time Feedback Loop

    The ideal process might look something like this: a short patient survey is conducted over the phone after a customer service call. Any time a patient provides a low score on this survey, an automatic alert is sent to a manager to listen to and evaluate the call. They then follow up with the relevant staff member to help educate them on how their approach could be improved for the next patient. Perhaps the same could be done using call mining and even social listening software in the future.

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    Chapter 4
    Evolving Demands Necessitate More Training

    In order to really tap into the mind of the patient, and to also enhance consumer understanding of healthcare processes and costs, providers need to invest more into one resource in particular: their staff. Who knows better the pain points than the people on the front lines, interacting with patients day in and day out? By the same token, leaders are realizing that in order for processes to feel seamless, revenue cycle staff need more education that goes beyond role-specific training.

    When it comes to communicating with patients, terms such as “denial” are often left unsaid. But why shouldn’t a patient be communicated with proactively and informed that their insurance has denied a service, what steps the organization can take next, and how they themselves can get involved? Perhaps this is because more staff would need to know what a denial is, what leads to a denial, and how they personally affect denials. With the industry’s increasing complexity, you have to educate your staff in order to educate your patients.




    1. Holistic, Revenue Cycle–Wide Training Is Trending

    It sounds so simple, but only recently have organizations began offering revenue cycle—wide training programs that provide an overview of the entire patient financial continuum, insurance terms, and how each claim touch can affect the patient, fellow staff, and the organization as a whole.

    More and more organizations are instituting in-depth orientation programs that cover each revenue cycle department, aside from just learning how to work within the EHR. In other cases, staff throughout the revenue cycle must complete competency courses and exams that promote a standardized knowledge base. In still others, back-end staff may be brought in to teach front-end staff how to collect on certain accounts, may become permanent fixtures on a training team, or vice versa. Of course, cross-training also plays a major role here, with a subset of providers reporting that they require staff to be cross-trained in other functions within a certain period of employment or as a prerequisite for their annual review. Hospitals or health systems may even take this approach a step further, and place a single leader over pre-service and billing or customer service teams.

    2. Scenario-Based Training Remains Crucial

    In order to fully prepare staff to properly explain complex concepts to patients, leaders have found it just as critical to hone in on scenario-based trainings.
    Examples may include scripting related to flex spending accounts, or out-of-network care.

    Going beyond the typical role-playing, healthcare leadersare providing new hires with training resources on common calls and how to handle them, having staff prove they can schedule and/or register more complex cases in the system’s practice environment before being given access privileges, or giving hypothetical cases and asking trainees to fill out system fields or a mock claim accordingly.

    3. Social Learning Appeals to Younger Workforce

    More future-forward health systems are developing more robust, social learning platforms. As of 2017, millennials make up the largest portion of the workforce, and information needs to be accessed and digested in vastly different ways than many of our historical training programs allow. This may be an internal web page where brief videos are uploaded to explain very specific processes. Staff can then rate the helpfulness of videos, or even post their own. This approach can be used in concert with audits to first identify where an error is occurring, then develop a short video on how to avoid it in the future. Sharp HealthCare recently developed a game-like workflow for its un-billed work queues. Staff develop their own avatars, and they earn or lose points as they carry on their daily tasks such as resolving edits, receiving denials, and so on. They see their name move up and down a leaderboard throughout the day, as well as who is active and inactive. This points system proves motivating for taking the next step or achieving resolution.

    4. Let Front-Line Staff in on Developing Solutions

    As staff learn more about the revenue cycle as a whole, and their piece of it, they can become quite valuable in suggesting improvements based on their patient interactions. Recognizing this, organizations have let front-line staff in on the ideation stage of new initiatives. Whether through a formal submission process, during all-staff meetings, designating a time and place for staff to map out ideas, or recognizing staff contributions with an award, encouraging staff to come forward with their solutions will be imperative to meeting patient needs on an ongoing basis.




    The Bottom Line

    The bottom line? Costs are rising for your organizations, patient financial responsibility is increasingly significantly, and reimbursement is declining. Unfortunately, healthcare stays behind in its adoption of technology and automation, even as other industries surpass it in innovation and consumer offerings.

    A value-based environment is requiring more partnered approaches—between healthcare facilities, payers, solution providers, and patients as well. Organizations who are embracing these partnerships are finding they are more nimble in not only responding to patient needs, but anticipating them.

    While many in the industry often conclude responsibility for patient education rides on the shoulders of the provider, it will truly take a variety of counterparts working in collaboration to promote patient understanding, and therefore, patient loyalty. 

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