Defuse frustration: Give info on what patients owe
It's a good argument for technology investment
These days, with patients ending up owing hundreds or even thousands of dollars in co-pays and deductibles, you may face a very angry person if you grossly underestimate what they owe. If a patient ends up owing $5,000 for a scheduled outpatient service, will he or she give you a "deer in the headlights" look, erupt with an angry outburst, or calmly take out a credit card to pay the balance? The answer may depend on the process you have in place to inform your patient of his or her responsibility.
"With the economy the way it is, more of the cost is being shifted to the customer," says Pam Stevens, director of patient registration at Cook Children's Medical Center in Ft. Worth, TX. "If I say it's $300 and it really ends up being $786, the parents will be upset. They want to know exactly what their cost estimate is."
"There has been a substantial change in the marketplace," according to Cheri S. Kane, MSA, FHFMA, CHFP, FACMPE, division president of The Outsource Group in St. Louis. Kane also is former vice president of revenue cycle at Grady Memorial Hospital in Atlanta.
"Employers are reducing first dollar coverage," says Kane. "Many commercial health plans have considerably higher out-of-pocket deductibles that are anywhere from a low of $250 to a high of $2,500." For uninsured patients, some hospitals are now agreeing to pay the patient's COBRA payments if the patient is an inpatient and has high dollar claims.
Cash-strapped patients are demanding to know in advance what they'll owe for scheduled services. "Patients are calling hospital to hospital to find the lowest cost for diagnostic tests," says Kane. "We are also seeing more patients asking what the charges will be prior to outpatient surgery, and working with their insurance company to obtain the service at the lowest possible cost."
Patients are becoming savvy to the fact that hospitals price differently, and are doing their own comparison pricing for health care. "Hospitals are developing standard pricing, but most are unsure of how to deal with complications," notes Kane. For this reason, most hospitals today only set fee schedules for outpatient surgery, and defer the set fee schedule if the patient becomes an inpatient and has complications.
Software is exception to rule
Although some technology investments for patient access are being put on hold due to the recession, price estimation software may be a notable exception. "I see facilities implementing electronic insurance verification systems and price estimation tools. You can easily demonstrate the ROI [return on investment] for those," says Karen Veselsky, CHAM, regional director of the revenue cycle at Catholic Health Initiatives in Exton, PA. "On the other hand, you have other products that would be nice to have, and might enhance your productivity, but they are not show-stoppers. Most facilities are putting those on the back burner."
For example, electronic signature pads for patients can save money due to less paper storage. "But that ROI is not as tangible as you need for the economy we are in right now," says Veselsky. "When you talk about software that can verify benefits and eligibility in real time, there is a much bigger argument for moving forward right now."
Cook Children's recently invested in price estimation software. "It's tied to our contracts, so I can load a patient on United Healthcare and it tells me to the penny based on my chargemaster what that patient's portion will be," says Stevens.
Stevens says she was impressed when she first tested out the new system on someone who owed several hundred dollars. "My patient advocate called me, I ran it through the system, and it told me to the penny what the account would owe," she says. After the estimate is done, a letter or email is sent to the family. A staff person makes a follow-up phone call to discuss the financial arrangements.
"This will make my staff much more productive. They won't be manually figuring it out on the calculator," says Stevens. "If the patient has a $500 deductible, $1,500 out of pocket, and they've paid 20% of their out of pocket already and they're coming in for an MRI, this calculates all of that automatically."
With more price transparency, and more employers going to health reimbursement accounts because the premiums are less, Stevens says that she's seeing more patients demanding to know what they'll owe. "We needed to give them an accurate estimate," says Stevens.
Stevens says that with the new system, staff "at least have the opportunity to get every penny out there. If you don't know what they owe, you can't ask for it. And if you don't ask, you can't get it," she says.
Stevens says the department has been aggressive with point-of-service collections for the past several years, routinely asking for the patient's portion in advance. "But sometimes people are in shock. They may have no idea that their out of pocket is $5,000," says Stevens. "People don't understand why they have to pay more out of pocket at certain points. Even though it's the customer's responsibility to know their coverage, oftentimes my staff are the first ones to explain it to them. Sometimes we get hit with anger and frustration. It's been a challenge."
There also are more people coming in without any coverage at all. For this reason, you need a staff member with excellent customer service skills to do the job of financial counseling, she says.
"It's not just a regular patient access person who is doing that job. You need people who really understand payment arrangements, COBRA, and government programs," says Stevens.
Stevens says that there is "absolutely" more pressure on patient access to collect more. "It used to be that somebody might owe $200 or less, and we just got it when they came in. Now we have to notify them ahead of time. You don't want somebody walking in at 5 a.m. for a procedure and telling them you need $4,500 right then," says Stevens. "They won't be prepared and won't have the funds available. Our policy says we will collect at the time of service for scheduled procedures. To do that, we need to tell them in advance."
According to Mary Clouse, patient access director at St. Luke's Hospital in Cedar Rapids, IA, "high-deductible/copay plans have been around for several years, so we have seen a fair amount of patients having these plans. Most employers negotiate new plans either the first of the year or the first of July. We have not seen any significant increase in employers changing to the higher deductibles with any 2009 contracts. But it would not surprise me to see more of these appearing for the 2010 calendar year."
In order to provide patients with the best possible estimate of their true out-of-pocket responsibility, St. Luke's financial counselors use the procedure code and insurance information to learn what the patient's benefits will cover. "We check how much they have met of their deductible, see what their insurance has for co-pays, and give them an estimate," says Clouse. "We stress that this is only an estimate. We tell the patient that if there are any complications, the actual out of pocket may be more."
At Grady Memorial, Kane was in the process of implementing price estimation software. Initially, this was being done for outpatient services, with outpatient surgery and inpatient services being phased in next. "Inpatient services are much harder to estimate. We are determining if these fees will be based on an estimated per diem by service, or if we will try to estimate based on the physician and the service provided," says Kane. "In the interim, like most hospitals, we are estimating prices based on the charge description master. And for outpatient surgery, we have a fee schedule."
Staff need new training
At St. Joseph Mercy Oakland in Pontiac, MI, patient access staff are given training to understand the importance of verification of benefits. "They need to understand the significance of that information and that this is completed every time a patient presents," says Monica Rei, director of patient access and patient financial services.
This is because, especially in this economy, "things can change dramatically from one encounter to the next," says Rei. "We do see that happening, with patients changing from a benefits to a self-pay status."
Previously, staff would go to the various web sites of all the different payers to verify a patient's benefits, but this process was time-consuming. To streamline this process, the department invested in software to give staff the ability to verify benefits in real time during the registration process. "It also gives us information about copays and deductibles. That helps us in our initiative to increase point-of-service collections prior to the date of service," says Rei.
During the registration process, staff are required to verify benefits and also any preauthorizations that need to occur prior to procedures. "We are trying to decrease the number of denials we have around this, so we do it prospectively and then retrospectively," says Rei.
With actual contract information loaded into the application, staff now have more accurate information to go by. The new system is part of a patient-friendly billing information initiative at the hospital. The goal is to give the patient as much information as possible prior to the date of service.
"In many cases, patients didn't have any idea what they really owed until a month after they had their procedure and left the hospital," says Rei. "We are letting them know in advance, and we are probably repeating it several times through the registration process. If they haven't made the payment prior to the service, it's no surprise to them when they finally get a bill from us."
Patients are more prepared to pay, or at any rate, they understand clearly what they are liable for after the procedure. While physicians' offices are accustomed to asking patients for copays before services, this is a new role for patient access. "We have been very reluctant to have these types of conversations with patients. So it's going to be a little bit of a challenge for staff to get to that point," says Rei. "But I think that as time goes on, patients will better understand that they have these liabilities. And the conversations will become easier."
Rei says that in her department, she sees "continued stress" involving patients struggling with their financial obligations and more self-pay patients, especially in the emergency department. As a result, the hospital is looking to implement financial counseling in the emergency department, in order to identify resources for these patients. "On our inpatient side, if they present as self-pay, we partner with the patient to help them with various programs they can be eligible for," says Rei. "We let them know we are advocating on their behalf."
[For more information, contact:
- Cheri S. Kane, MSA, FHFMA, CHFP, FACMPE, Division President, The Outsource Group, 3 City Place Drive, Suite 690, St. Louis, MO 63141. Phone: (937) 367-6590. E-mail: [email protected].
- Monica Rei, Director of Patient Access and Patient Financial Services, St. Joseph Mercy Oakland, 44405 Woodward Avenue, Pontiac, MI 48341. Phone: (248) 858-3000 E-mail: [email protected].
- Pam Stevens, Director of Patient Registration, Cook Children's Medical Center, 801 Seventh Avenue, Fort Worth, TX 76104. Phone: (682) 885-4234. Fax: (682) 885-4100. E-mail: [email protected],
- Karen Veselsky, CHAM, Regional Director Revenue Cycle, Catholic Health Initiatives, 367 Eagleview Boulevard, Exton, PA 19341. Phone: (610) 401-3097. E-mail: [email protected].]
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