Three ways to rein in high deductibles, costs


A new report from West has surprising findings about high-deductible health plans and insurance coverage.

More than half of Americans are delaying payment on medical bills-citing high-deductible health plans and confusion over insurance coverage as the primary reasons, according to a study. 

A new “Optimizing Revenue” report from West, shows that over half of patients are delaying medical payments, or even foregoing healthcare services altogether, citing high-deductible plans and confusion over insurance coverage as the primary reasons. Providers, as a result, face some significant revenue challenges and are tasked with trying to manage bad debt, increase revenue and optimize reimbursements cost effectively.


“The rise in high-deductible plans coupled with the escalating cost of healthcare services is contributing to the financial viability of healthcare organizations across the country,” says Allison Hart, West’s chief market research and insights strategist. 

In working with its healthcare clients across many disciplines, Hart says that she and researchers kept seeing these same trends of organizations struggling to manage revenue cycle challenges.

“We wanted to shed some light on these issues in an effort to improve the patient experience, and to also help healthcare organizations understand where they may be missing opportunities,” she says. “Although high deductibles topped the list, we also revealed some other significant factors preventing patients from making on-time payments including confusion over insurance and forgetfulness.

“Although everyone agrees that more measures are needed to help patients and practices that are struggling financially, in order to do so, we need to know where they need to strengthen and expand efforts to truly solve payment issues” Hart says.

Eighty-five percent of patients feel there are strategies providers could use to encourage them to make on-time payments. “We wanted to examine those more closely to help organizations improve their financial health,” Hart says.

Managed care executives are central to ensuring their organizations are not only delivering services that improve the quality of life for each patient, but are doing so in a manner that maintains the financial health of their providers, says Hart.

“Executives that are focused on improving the operational efficiency of their organizations also understand that implementing or expanding technology-enabled tools can markedly improve both patient and provider satisfaction,” she says.

The financial impact of value-based payments is becoming more evident and healthcare organization need to prioritize improvements, says Hart. “Both patients and healthcare organizations are financially challenged-patients are struggling to pay medical bills and one of the top challenges facing healthcare organizations is managing these overdue payments. Healthcare organizations that adapt and focus on leveraging existing resources-like technology-enabled communications-to engage patients in healthcare discussions will be able to better address revenue cycle challenges.”

According to the report, unfortunately, the high cost of healthcare has been a long-standing issue for many patients. In fact, the report found that nearly 93% of Americans believe U.S. healthcare is too expensive and 79% believe that affordability is the biggest issue that is faced-ahead of insurance coverage, care quality and provider availability. The study also found that most providers agreed. In fact, 95% recognized that patients may delay payments due to financial hardships, yet only 23% made a habit to discuss cost prior to delivering services.

“So, there is a definite gap in communication and a clear opportunity for improvement,” Hart says.

Next: 3 ways to take action



Hart offers three ways to rein in high deductibles and the high cost of care.


1.   Communicate to get paid.

“We found that providers are missing opportunities to engage patients in conversations about healthcare costs to ensure that patients are financially prepared,” Hart says.

In fact, according to the report, two in four patients are unaware of the cost of services until after they receive a bill. Healthcare organizations can open the door to payment discussions by using automated communication technology they may already have in place to inform patients of potential copayments and out-of-pocket costs. Currently just 21% of providers send automated reminders to notify patients when payments are due, and 15% currently send messages-either by phone, text or email-to explain bills and let patients know what is covered by insurance.

“Adopting a more proactive approach to communicating costs would not only save organizations time and money that is currently lost on collection efforts, but it would also engage patients more in the financial process,” she says.

2.   Drive usage of preventive care.

Americans currently use routine care at only half the suggested rate, which also means healthcare organizations are missing out on potential revenue opportunities from preventive care, according to the report. It found that 71% of patients choose to postpone necessary treatments or tests due to high deductibles. And although 63% of providers say promoting necessary preventive care services to drive new revenue is a high priority, they fail to follow through with these actions.

“Organizations could do a better job of sending technology-enabled communications to educate patients about the advantages, availability and affordability of preventive services,” Hart says.

3.   Improve chronic care to maximize reimbursement potential/avoid penalties from value-based payment models.

Twenty percent of medical practices and 18% of hospital and health system providers report that CMS’ Chronic Care Management program is the top care program they are currently focusing on, according to the report.

“However, chronic patients admit they do not always receive healthcare due to concerns about cost,” Hart says. “Executives need to help their providers focus on maximizing reimbursements by leveraging automated technology to meet Medicare’s chronic care management program requirements, while ensuring patients receive preventive services and support throughout their treatment journeys.”

High readmission rates have also resulted in steep financial penalties for hospitals and intensified the need for health system providers to optimize reimbursements, says Hart.

“To avoid these penalties, providers need to prioritize activities that will help stave off readmissions,” Hart says. “For example, providers might accomplish this by sending automated surveys to chronic patients in order to proactively identify and address any concerns before they escalate to needing acute care. Again, by leveraging technology-enabled communications, providers can facilitate personal messages that encourage patients to complete a short survey about their health status. Healthcare systems can also leverage EHR systems to identify and enroll patients who might be at greater risk in chronic care management programs using automated outreach.”



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