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The Perfect Plan for Prompt and Painless Patient Payments
March 2, 2016 Tim Ledbetter
Healthcare IT Consultant, Granger Medical Clinic
Conflict of Interest
Timothy Ledbetter
Has no real or apparent conflicts of interest to report.
Other: HIMSS travel and accommodations paid for Navicure, Inc.
Agenda
• Introduction
• Learning Objectives
• STEPS
• The State of Patient Payments
• GMC: Challenges, Goals and Solutions
• Recommendations
• STEPS recap
• Q&A
Introduction: Tim Ledbetter
• Former Director of Revenue Cycle Operations at Granger Medical Clinic, Salt Lake City
• 10+ years of healthcare IT management
• Also served as Director of Revenue Cycle Operations for Kaiser Permanente
• Currently a healthcare IT consultant
Learning Objectives
• Describe the shifting healthcare payment landscape where patients are bearing more financial responsibility for their healthcare services and the impact this is having on healthcare organizations.
• Identify methods healthcare organizations can use to initiate patient financial discussions and help patients understand their responsibility through documented estimates and payment plans.
• Measure patient collections performance by evaluating key revenue cycle metrics such as overall patient collections, average days in accounts receivable and days from when services are delivered to when first patient payment is received.
Learning Objectives Continued
• Evaluate information technology (IT) vendors that will facilitate collections at or near the time of service by receiving permission to securely store credit/debit card information and charging card once patient responsibility is determined or an automated payment plan has been established.
• Recognize why employees avoid facilitating financial responsibility conversations with patients and propose reasons why discussing payment options before services are delivered can improve collections and clinical quality as patients will be less likely to avoid care if they have affordable options.
STEPS: Savings
Increased
patient
payments by
$1.3 million
in first 30
days
Granger Medical Clinic (GMC)
• Largest independent multi-specialty practice in Utah’s Salt
Lake Valley
• 115 providers
• 6 locations
• Process over 1,000 claims per day
• Services for patients and communities include primary care
(internal medicine, family medicine, pediatrics, obstetrics
and gynecology) and urgent care and other specialties.
• Partnership with Wasatch Internal Medicine and Foothill
Family clinic to create an Accountable Care Organization
(ACO).
• Patient financial responsibility is still on the rise:
– $13,200 is out-of-pocket spending maximum for health plans*
– Nearly half of families covered by employer-sponsored plans face $7,000 in out-of-pocket expenses**
– Average cost of an employer-sponsored family health plan was more than $16,000 in 2014
– High-deductible health plans (HDHPs) increased tenfold in past 7 years
* Healthcare.gov - https://www.healthcare.gov/glossary/out-of-pocket-maximum-limit/
** Washington Post, “Yes You Are Paying a Lot More for Your Employer Health Plan…”
JP Morgan White Paper “Key Trends in Healthcare Patient Payments”
State of Patient Payments in the U.S.
State of Patient Payments in the U.S.
• Patients may be unable to pay their new higher balances:
– Nearly 43 million Americans have unpaid medical bills*
– Nearly half of survey respondents earning less than $30K say their savings are eclipsed by medical debt**
• More than half are worried they won’t be able to pay their medical bills**
*Study by Consumer Financial Protection Bureau
**The Washington Post citing BankRate Survey:
https://www.washingtonpost.com/news/wonk/wp/2014/09/04/why-your-fear-of-medical-debt-is-entirely-
justified/
• Patients have a steep learning curve regarding payment responsibility:
– 16.4 million people are now insured via Affordable Care Act (ACA) – millions are insured for the first time*
– Patients with employer-sponsored plans aren’t accustomed to high-deductible plans
– Research indicates more than 60% of patients don’t know their payment responsibility prior to receiving care**
*HHS.gov - http://www.hhs.gov/healthcare/facts-and-features/fact-sheets/aca-is-working/index.htm
** InstaMed’s 5th Annual Report on Healthcare Payment Trendsl
State of Patient Payments in the U.S.
GMC Challenge: Inefficiency
• Overarching lack of consistent payment policies and processes across practice
– e.g., each physician had own payment policy
• Inefficient, resource-intensive patient payment processes
• Limited collections at point of service
GMC Challenge: Heavy reliance on post-service collections
• Post-service collections entirely paper-based
• Offered payment plans, but:
– Not automated (i.e., scheduled recurring payments).
– Managed by outside vendor with tight control.
• Often collected fraction of original balance due to high percentage of accounts sent to collections agencies.
Solution: New processes and policies
• New, standardized financial policy requires patients to sign off on plans to pay balance in full before they leave
• Processes automated when possible, streamline tasks and free up time for financial discussions and collections activities
– Provides ample patient communications to remove uncertainty about payment responsibility or how they can pay off balance
– Facilitates time-of-service collections via tools and technology (e.g., payment tool that securely stores credit card info; platform to establish scheduled payment plans)
Solution: Automate Anywhere Possible
• Key places to automate and why
– Patient estimation
– Scheduled payment plans
– Patient financial portal
– Storing patient’s debit/credit card information for automated billing
Solution: Train and Coach Staff
• Understand staff may be uncomfortable asking for payment; hear and address their concerns
• Provide training, scripts, opportunities to practice
• Remove obstacles that keep staff from asking for payments (lack of training, inability to tell patients what they owe, time-consuming manual processes)
Solution: Choose “few that offer more”
• Fewer vendors = standardization, consistency, better support and
fewer technical issues
• Evaluate vendors with an eye toward:
– Eliminating gaps in current performance
– Following best practice processes (or optimizing current processes)
– Reducing # of vendors
Solution: Choose “few that offer more”
• Negotiated with current vendors to expand current services to fill gaps
• Established “early-out” collections process
– Outsourced some collections duties to financial services vendor
Solution: Obtain Greater Visibility
• Established metrics to monitor to gauge performance
– Time from time of service to payment from insurance companies and patients
– Discharge Not Final Bill (DNFB)
• Consolidating vendors enabled easier reporting and monitoring
STEPS
Achieved claims
first-pass rate
of
96%
• S=Satisfaction. Patients are more satisfied understanding their
financial responsibility before services are delivered.
• T=Treatment/Clinical. Better understanding of the cost of some
elective services helps patients understand how lifestyle changes could
avoid a major expense.
• E=Electronic Information/Data: Transitioning from a paper-based to
an IT-driven patient payment plan and collection process offers
organizations much more easily accessible and timely data than
information that must be manually entered from paper forms.
STEPS
Achieved claims
first-pass rate
of
96%
• P=Patient Engagement/Population Management. Offering a payment
estimate and fair payment plan also demonstrates the healthcare
organization cares about the patient’s health and financial situation.
• S=Savings. Eliminating paper-based processes reduces costs
associated with statements, print and postage, but it also reduces labor
expenses associated with creating patient statements and collections
letters, as well as opening mail and depositing paper checks.
Results: Patient Payments Revenue
Scheduled $100,000+
in payment plans
within one month of
implementation
Results: Patient Payments Revenue
29% increase in
monthly payments in
first 30 days
Results: Cleaner Claims
Automation
helped improve
claim first pass
rate to 96%
Recommendations
• Face the future! Current trends will continue
• Launch smart pilot programs
• Standardize but make exceptions when needed
• Reduce vendors – and ask vendors to do more
Recommendations
• Automate and streamline
• Use technology that conforms to your processes – not the other way around
• Monitor and measure to detect negative trends before they impact performance
• Stay nimble
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