Strategies for Managing Payment From Self-after Patients
Thanks to the June 28 Supreme Court decision, one problem that radiology practices might not face for much longer is managing payment from uninsured patients—an issue that currently plagues hospital-based groups, in particular, according to Krista Pelensky, director of operations with Medical Management Professionals (MMP). “Many hospital-based groups have seen an uptick in uninsured business and an increase in emergency-department services,” she says. Even if this problem is mitigated by health-care reform’s individual mandate, however, there is a second, and growing, category of self-payment with which radiology groups must contend. This category consists of self-after patients: those whose copayments, deductibles, and other out-of-pocket contributions to the cost of their care have become so high that paying their bills after service is rendered can be burdensome—as are collections, for the radiology group. “We have reviewed statistics for our clients, and in some cases, traditional managed-care patients have seen their patient-responsible portions increase by as much as 40%,” Pelensky says. “Patient responsibility has been increasing over the years, and many patients are now burdened at the same rate as uninsured patients, in spite of being insured.” The increase in patient responsibility for self-after patients is a relatively new phenomenon, Pelensky observes, and as such, it has caught many radiology practices unprepared. “Hospital-based providers, in particular, have not been accustomed to educating insured patients about their plan coverage, but that is changing rapidly,” she says. “There are more and significant dollars on the line now.” Impact on Practices Needless to say, an increase in the percentage of patients who cannot pay some or all of their after-insurance bills has a deleterious effect on radiology groups’ financial health. Pelensky notes that days in accounts receivable might rise, if they have not already. “Groups are also seeing increases in the number of self-after accounts being turned over to collection agencies,” she says. While groups do collect from uninsured patients for some services, Pelensky says, it is a somewhat surprising fact that in some cases, collection percentages on the self-after side are not much higher. “You would expect that the payment rate would always be higher. The truth is, in some cases, it is not, which can mean lost revenue,” she says. “At the end of the day, the likelihood that a patient (compared with an insurance company) will pay is just much lower.” In hospital-based imaging environments, up-front payment can be difficult (or even impossible) to wrangle, but imaging centers have seen some success with this strategy, Pelensky says. “Cash up front can have a very positive impact on the practice’s financial health,” she observes. This approach is not without its drawbacks, however; enhanced regulations covering personal credit-card information create bureaucratic difficulties, and out-of-date information on insurance eligibility or allowables can result in inaccurate estimates of patients’ financial responsibility “Insurance verification is only as good as the information the payor provides at the time the request is placed. With high-deductible plans and increased coinsurance amounts, verification timing is critical,” Pelensky says. “It is not uncommon for carriers to adjudicate claims with a patient portion that varies from previously quoted rates simply because of other pending claims. As a result, we have seen an increase in refunds from imaging centers that collect dollars up front.” In addition, Pelensky says, demanding cash up front and subsequently refunding a portion might be perceived poorly in a practice’s community, affecting referrals. “It is a customer-service issue, and if not handled appropriately, it can have an impact on an imaging center’s reputation—which, in turn, puts referrals at risk,” she says. Improving the Process With the limitations of up-front payment in mind, how can radiology practices improve the payment process for self-after patients to maximize revenue? According to MMP data, even offering payment plans as an option has little impact on the amount of money collected. “We have offered those historically, and we continue to do so, but we have not seen a real increase,” she says. “We have even completed trials where we have included payment-plan options on the patients’ statements, thinking they might be more inclined to participate if they did not have to call and request a payment plan—and unfortunately, we did not see any increase in payment activity for that, either.” Instead, Pelensky recommends that radiology groups hone their in-house customer-service skills, when it comes to billing. “Making sure your representatives are accessible to answer patient inquiries, are knowledgeable about health care and radiology billing, and are willing to ask for payment is a very big deal,” she notes. The patient statements themselves deserve additional attention, Pelensky adds. “Clarity in billing statements is still a problem,” she says. “Patients receive billing statements that are either several pages long, with too much information, or are too concise, lacking appropriate detail. The statement should clearly delineate the amount that is the patient’s responsibility—and why. In addition, the expectation of payment before the due date needs to be stated clearly.” Practices should also offer online payment as an option. “A large percentage of the population using the Internet to make payments does so in the evening, so having a payment website is critical,” Pelensky says. Pelensky concludes that for the sake of their ongoing financial health, radiology practices must apply to the billing process the same patient-centered focus that has influenced imaging-center design and radiology-service marketing. She says, “Providers have gone to the trouble of making their facilities and front desks more patient friendly and efficient. Now, they have to find ways to help patients understand their bills and to motivate them to pay, which is another challenge entirely.” Cat Vasko is editor of ImagingBiz.com and associate editor of Radiology Business Journal.