Did price estimate turn out to be wrong?
Executive Summary
Patients rely on patient access employees to inform them of out-of-pocket costs, but accurate estimates are challenging to give. This challenge is due to changes in what is done clinically, provider contracts, patient co-morbidities, and the complexity of coverage. Patient access can do the following:
• Contact physician offices to obtain medical coding information.
• Implement software to integrate professional and hospital services.
• Set up a price estimation line for patients to call.
Exact quotes aren’t always possible
Despite the best efforts of patient access staff, price estimates sometimes turn out to be incorrect. This situation happens because of inaccurate benefits information, unexpected add-on procedures, or incorrect procedure selections.
"An estimate is not just plug-and-play. It is sometimes like nailing [gelatin] to a wall," says Katherine H. Murphy, CHAM, vice president of revenue cycle consulting in the Oakbrook Terrace, IL, office of Experian/Passport Health, a provider of technology for hospitals and healthcare providers.
If the estimator displays the actual step-by-step calculations, it’s easier for staff and patients to understand how the patient liability amount was arrived at, says Murphy, "allowing for a highly transparent and positive interaction."
Estimates are just that, however, and are not as accurate as preliminary billing statements unless there is a direct one-to-one match with the chargemaster or a flat rate is being used, says Murphy.
At Strong Memorial Hospital in Rochester, NY, if a patient was given an estimate and the cost isn’t within the quoted range, he or she is referred back to the price estimation specialist for review.
"If the quote was incorrect, the patient would be responsible only for the amount quoted, unless the procedure or services provided to the patient were different than what the original quote was based upon," says Karen Stein, manager of patient services in the hospital’s finance department. Stein adds that there is a less than 2% error rate on estimates given to patients.
If the discrepancy is not related to a complication or a different service being provided, the patient is held harmless for the difference between what they were quoted and the actual costs. If additional services were provided, however, staff members tell the patients that these services weren’t part of the initial estimate.
"If necessary, we reach out to the physician to get an explanation of why the original procedure was changed, so we can give further details to our patient," says Stein. (See related story, below right, on involving providers in price estimates.)
Patients need help
Most patients are not familiar with deductibles, coinsurance, or co-payments, nor do they understand what charges they are responsible for.
"Patients may need help understanding what it means to have to meet a deductible before services are paid by their insurance, as well as how coinsurance works," says Stein.
Many patients chose insurance coverage based solely on the cost of the premium. "They then unexpectedly incur exorbitant expenses if something catastrophic happens," says Stein.
When patients ask what their true, out-of-pocket costs will be for a requested service, therefore, patient access employees have to do considerable education. "Many patients don’t understand the terminology, costs, and benefits with their insurance plan," says Stein.
She says the primary challenge is explaining to patients that the estimates they’re given are based on a specified procedure. There could be complications or other factors that necessitate additional procedures.
"It’s not always possible to provide an estimate to an exact dollar, as those clinical variables can greatly affect cost," says Stein.
Patients given info
Strong Memorial’s patient access department implemented a price estimation line so that patients can call to obtain estimates for the hospital and for physician services.
"If a patient has insurance, we will reach out to the insurance carrier to discover each patient’s specific benefit information to learn their potential out-of-pocket expense," says Stein.
Staff members then give the patients estimates based on the true, expected reimbursement for the services. "At that time, we also explain our financial assistance programs, as well as any questions they may have in regard to their benefits," says Stein.
Information was added to the hospital’s website to alert patients about the price estimation line. "At the point of care, postcards are available that can be given to patients to let them know about this service," says Stein.
Delay in estimates
Patients calling for a price estimate want a quick, simple answer. "They are not aware of the technical information needed in order to obtain the cost," says Stein.
In fact, estimating is a highly complex process, says Murphy, and automation is the only way to do it well. "It is not an exact science, but often, this is not clear at the executive level," she adds.
Writing off the differences if an estimate turns out to be incorrect is a hospital’s prerogative, notes Murphy.
"But if a clearly stated disclaimer is on the estimate, and the facts show why the estimated verses actual amounts differ, then discrepancies could be well-articulated," she says.
- Katherine H. Murphy, CHAM, Vice President, Revenue Cycle Consulting, Passport Experian Health, Oakbrook Terrace, IL. Phone: (630) 812-2559. Fax: (630) 620-9328. Email: [email protected].
