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Customer Sensitive CollectionsEssential Self Pay Processes

Presented by: Chuck Seviour

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PATIENT THIRD PARTY FOLLOW-UPThird Party Follow-Up

*PRE-ADMISSIONPrior Authorization & Pre- CertificationFinancial Counseling

Your Opportunity for Self Pay Collections in the Revenue CycleOpportunities to create a Customer Sensitive Patient Experience

*ADMISSIONSEmergency Room Registration,Front Desk Registration

CUSTOMER CONTACTCustomer Service

BAD DEBTCollection Agencies

At your facility, does patient experience facilitate understanding and is it an experience that insures the patient is treated with Compassion-Dignity-Respect?

New Healthcare Patient Profile

• High Deductible

• High Co-Pay

• Health Savings Account (HSA)

(This ain’t the patient we knew five years ago)

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Providing a cost estimate improves the patient experience

“Patients are more satisfied with their hospital experience when they understand their financial responsibility before services are provided…”

― Keith Mertz, Relay Health

Patient Profile

Effective Customer Sensitive Collections

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• We are not dealing with the patients of yesterday!

• Today’s economy and unsettling uninsured and underinsured numbers make it all the more important to handle patients in a manner that allows for a “win-win” situation for the patient and the facility

• Successful collections require a staff that understand the facilities goals and objectives and has the skills to handle difficult situations and negotiations

Fact:

Presently over 50 Million Americans are uninsured. However, approximately 65% of these Americans make over $25,000 a year and 25% of these Americans make over $40,000 a year (averages based on recent studies that vary according to the reporting agency).

Patient Profile

How do patients prioritize their medical expenses?

USA Today article, National Consumer Law Center “Guide to Surviving Debt” stated in 2002:

An unsecured debt, such as hospital and medical bills, is low priority and there is rarely anything that these creditors can do to hurt you in the short term. Many won’t bother to try to collect in the long term.

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Fact:

According to a recent study, consumers are more likely to pay the mortgage, insurance loan, and utilities before their healthcare bills. They are also more likely to pay for cable TV, internet, lawn care and the newspaper.

Patient Profile

Compare your information to a $5,000.00 car loan

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Fact:

The average worker is paying nearly $4,000.00 toward the cost of family health insurance.

Patient Profile

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No community is unique –all communities have patients and all patients have needs. The job of an effective POS is to help patients understand the needs of the hospital.

The bottom line is patients have a personal responsibility to pay for their services.

Bottom Line

Patient Profile

Improving Business Office Operations

• Leave the past behind

• Optimize your technology

• Implement your best practices

• Set Daily Goals– Redirect your focus

– Change the way you look at processes

– Become equipped with the tools to effectively improve your process

– Take a break (occasionally)

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Fact:

Historically over 25% of insurance and patient information is inaccurate if not collected at the date of service or prior to the date of service during a preregistration process.

Pre-Admission

Challenges Facing Hospitals & Clinics Today

• Bad debt on the rise

• High costs associated with collecting patient balances

• Treating outstanding patient accounts the same

• Decreasing customer satisfaction levels

• Utilizing staff time effectively and efficiently

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Fact:

As a part of ongoing training, it is important that the staff understand the importance of non-discounted dollars to the facility.

Pre-Admission

Results

• Cash coming in earlier in the collections process

• Improve payment accounts that have been in A/R for 120 days

• Constant patient-centric experience for all patients

• Control patient contacts – minimize complaints

• Improve staff efficiency

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Give your internal and external customers the information necessary to make an educated decision…

Pre-Admission

Pre-service Financial Clearance

• In an effort to improve collection rates, hospitals have begun, moving from post-service patient accounting, to pre-service financial clearance at patient access

• Registration staff performs all financial clearance functions before services are rendered

• Demographic, financial and clinical data capture the move to per-service, along with identity verification, eligibility verification, authorization, referral management and payment collection

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Fact:

A recent study found as much as 31% of self pay revenue written off to bad debt collection actually met provider charity-eligibility guidelines.

Pre-Admission

The Rewards of Pre-admission

• Financial Counseling– Educate your patients in the cost of their hospital

stay

Important in the overall aspect of collecting co-pays and balances in full where possible

– A few things to consider

Establish co-pay collection policies and procedures

Who collects? – consider it a team effort

“How will you be paying today?” is a better question to ask than “Will you be paying today?”

Train and reward your staff for following your policies and procedures.

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Fact:

Surveys consistently indicate that over 60% of patients rank knowing what the procedure will cost them as their #1 concern; in knowing the cost, 30% of patients recover faster than patients who don’t have a clue what the procedure will cost.

Admissions

Roll of the Financial Counselor

• The financial counselor will have maximum effectiveness when they contact the patient

• Collection of money, though the top priority, does not mean non-collection has resulted in a poor call with the patient

• Educating our patient about their fiscal responsibility is essential in the contact process

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Tools such as online credit card payments and ACH payments that are readily available for the patient to use when they have indicated when they are willing to meet your request can really help the process.

Admissions

Emergency Department Co-Pay Collections

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Fact:

It is estimated, next year over thirty percent of patients will have a minimum, $3,000.00 deductible and carry higher co-pay requirements than in the past.

• Collecting in the Emergency Department is an important practice

1. Does EMTALA say you cannot collect in the ED

2. Does your Commercial Insurance Company prevent you from collecting in the ED?

3. Does your ED triage prevent you from collecting co-pays?

• You can and should collect co-pays in the ED because they represent the only non-discounted dollars you will receive from the patient

Essential “Cash” Stop

Purposes of Co-Pays in the Emergency Department

• Co-Pays in the ED serve three purposes:1. Financial – Collection of non-discounted Self Pay

dollars

2. Contractual – it is an agreement between insurance company and patient

3. Educational – helps patients realize they must pay the Self Pay portion of their bill whether in the ED or owed for other hospital services performed

• It is imperative to train staff to properly collect in the ED

• Scripting, role-playing, and practice will increase the effectiveness of training and increase your co-pay collections

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Fact:

Once patients understand the concept that co-pays are part of their bill, a typical hospital will increase payments and improve timeliness of payments.

Essential “Cash” Stop

Clinic Co-Pays

• The purpose of collecting co-pays is clear:

1. Co-pays are the only non-discounted dollars you will receive for your facility

2. The patient’s insurance premium is based on their co-pay and deductible amounts

3. The insurance company expects co-pays

• Co-pay collection requires specific training which includes these elements:

– Expectations – scripting to set the tone and address patient responses

– Timing – the entire discussion should take less then a minute

– Understanding – ensure staff understands the impact and importance of non-discounted dollars

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Fact:

Patients will bring their payment when they realize they have a responsibility to pay at the time of service. Implementing successful co-pay processes will allow clinics to collect thousands of dollars that no longer linger in either Self Pay or bad debt.

Scheduling and Registration

Self Pay Revenue Cycle

Pre-Service

Point-of-Service

Post-Services

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Emerging Revenue Cycle

The emerging revenue cycle shifts the bulk of patient account management activities, such as patient identification, payment estimation and collection, to PRE-SERVICE, when it is easier to collect and identify alternative sources of payment.

The New Self Pay Patient

Procedures for Customer Sensitive Collections

• Self Pay requires “collecting” the balance expediently, with minimum follow up, and always with dignity, compassion, and respect

• Strategically follow up on insurance accounts within 5 days of a patient receiving Explanation of Benefits (EOB)

• The processes should include a series of calls and letters

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Fact:

An effective Self Pay collection process can reduce your days in A/R and bad debt by as much as 25%.

Self Pay Follow-up

Analyzing Your Self Pay Process

• Some considerations when analyzing and deciding on your Self Pay process:

– Is outsourcing an option for collection Self Pay?

– Are there alternative financing options available to assist your patient?

– Scoring accounts allows for quick identification of low, medium and high risk patients. Is that an option which could positively alter your work strategy?

– What are the abilities of your team and can they effectively maintain the high demand requirements for collecting from Self Pay patients?

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Fact:

Without an effective system in place to manage Self Pay accounts, healthcare service providers miss out on a large number of collection opportunities.

It has been found that accounts that have been written off as bad debt, approximately 50% showed a capacity to pay – 16% were classified as high household income, and 33% were classified as moderate.

Third Party Self Pay Help

Verifying Eligibility

• Employ workflows that check for eligibility for every patient, at every point-of-service, including post service

• Incorporate eligibility conversations/discussions before and at the point-of-service

• Patient access staff can have meaningful conversations with patients on what is owed

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Fact:

With increased deductibles, co-payment, co-insurance and out-of-pocket maximums, patient-access staff must stay up-to-date of the latest coverage to estimate bills correctly and manage patient’s expectations.

Third Party Self Pay Analysis

Verify Patient Data and Identity

• Half of all billing elements on a claim originate a the point of access, so correct information at registration is vital to an efficient revenue cycle

• Verifying patient identification earlier helps prevent data fraud and identity theft

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Fact:

In a study by MasterCard, 82% of healthcare facilities said their bad debt was increasing or staying the same. However 10% saw a decrease in bad debt, which they attributed to implementing collection policies at the point-of-services.

Third Party Self Pay Analysis

Prioritizing Collection Efforts by Balance

• Prioritizing Collection efforts by balance due leaves money on the table

– Expected Cash Value is the right measure

How much cash should we expect to collect from this account

– Expected Cash Value is NOT the same and propensity to pay or probability to pay

These are measures of “how likely an account is to pay”

Fail to answer what percentage of the bill will be paid

– Expected Cash Value key to managing collection operation

Question that matters in collection is: Where is my cash?

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Fact:

Federal and state lawmakers and consumer advocates have taken action to ensure that low income uninsured and underinsured Americans are charged fair prices for their care and are protected from aggressive debt collection practices.

Many healthcare providers are struggling to determine and implement proper, consistent processes to apply these discounts and sharing these prices at point-of-service.

Self Pay Follow-up

Credit Scores and Credit Files

• Credit scores and Credit files are not a panacea for Self Pay

– Credit scores are origination scores for voluntary purchases

– Low credit score does not mean poverty or low income

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Fact:

As much as 35% of self pay revenue and 25% of cash comes from households lacking full credit file or credit score.

Customer Contact

“When the Patient Calls…”

1. Every phone call regarding a bill is an opportunity to show the best in customer service

2. Staff education is essential to having productive and successful calls with your patients

3. Patient calls should be handled in one location

4. A “Call Center” approach to patient calls enables customer service to prosper and your accounts receivable to be reduced

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With a little training we can become more comfortable relaying and gathering pertinent patient information and decrease the number of abandon calls by patients who become frustrated with the process, thus, increasing our opportunity to either procure essential billing information or actually “collect” Self Pay dollars that are due.

Customer Contact

Patient Calls are Important…

• Attitude:– Ensure a good patient experience– Help them understand their obligation or the

obligation of the insurance company– Handle all calls appropriately and

professionally

• Resolution:– Ensure calls are complete with an end

resolution– Provide additional follow up and resolutions

to insurance questions – Resolve Self Pay issues by either taking

payments over the phone or setting specific criteria for appropriate payment arrangements

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When talking with patients, we have to remember that they may not fully understand some aspect of their financial obligation and are looking for guidance.

Customer Contact

Charity Care/Community Care

• Signs of “Charity Gap”

– Charity can only be granted with full documentation

– Open ended process, accounts can age forever

– If patient is missed by financial counselors, they are never evaluated

– Manual process, no automation

– Rely simply on single income estimate, credit score or propensity to pay score for charity declaration

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Fact:

A significant portion of people living in poverty will not participate in financial counseling.

HFMA estimates that on average 25% of self pay is more likely charity.

Compassion. Dignity. Respect

Typical third-party timeline

27Third Party Follow-up

1-30 Days After Assignment

• Call Attempts Begin

• Outbound Dialer strategy established

• Review of previous notes and payment history

• MA Scrub

• Review for Admission and Treatment Discount

30-60 Days After Assignment

• Call Attempts Continue

• Heavier Emphasis with Direct Connect/ Agentless Dialer

• Check for other insurance information and MA Scrub

• Review previous contact attempts and system notes

60-90 Days After Assignment

• Call Attempts Continue

• Emphasis on predictive dialer and Direct Connect

• Review of previous efforts and contacts

• MA Scrub

90-120 Days After Assignment

• Final Review of Account

• Audit Work Standards

• Final Manual Call

• Final Check for other possible insurance

• MA Scrub

• Admission and Treatment Review

• Refer to Agency if no resolution

Third Party Solutions

• Some important Third Party services available to you include:

– Self Pay collections, prior to bad debt

– Scoring at time of admitting, to determine your patient’s propensity to pay

– Coding

– Insurance follow-up

– Online credit card payments

– State of the art business intelligence platforms

– Eligibility for patients

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Fact:

There are over 50 million uninsured patients in the United States according to a 2011 report. This is an enormous burden that has to be addressed by today’s revenue cycle departments.

Bad Debt

Some “Cash” for Thought!

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Key Performance Indicators (KPI’s) Analytics

Percent of Cash Collection 93%

A/R Days 59.5

A/R – Over 90 Days 37%

Charity/Community Care 5.4%

Bad Debt 6.6%

Collection Costs 4%

Denial Write offs 1.18%

First Pass Denial Rate 14%

KPI’s

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Questions

Questions

Thank You

For more information please contact:

Chuck Seviour, VP Revenue Cycle200 14th Avenue East, Sartell, MN 56377Office: 218-770-0637 Cell: 218-770-0637Email: [email protected]

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