The healthcare industry is experiencing a major shift in a patient’s financial responsibility. This is largely driven by significant changes in the reimbursement model, but there is so much more to consider than collecting payments.
Consumer payments to healthcare providers nearly doubled from 2012 to 2015, and insurance deductibles have increased a startling 255 percent since 2006. In addition, 84 percent of employers have increased or say they plan to increase insurance deductibles and/or copays for their plan participants.
This means healthcare providers are managing a much higher volume of patient payments. These increased volumes are causing healthcare providers to rethink their approach to collecting payments. A new approach means looking at payment security, PCI scope, EMV and workflow changes to how patients are engaged.
To understand these challenges and how healthcare providers are responding, let’s take a look at some of the top revenue cycle initiatives in the industry
Revenue Cycle Initiatives
Bloomberg recently reported that the second-biggest for profit U.S. hospital chain revised its Q4 2015 provisions for bad debt up by $169 million. Forty percent, or $68 million, was from patients that were unable to pay deductibles and co-payments.
In a similar fashion, J.P. Morgan’s Key Trends in Healthcare Patient Payments report pointed out that the rate of bad debt for insured patients is increasing by over 30 percent per year at some hospitals.
Not surprisingly, these and other challenges stemming from increased patient responsibility are dominating the 2016 revenue cycle management agenda for senior finance executives in healthcare. Among the top revenue cycle initiatives for 2016 are several related to payments:
- Preventing or resolving underpayments
- Lowering the cost to collect patient payments
- Increasing collection rates among insured patients
- Collecting more balances at the point of service
The Role of Payment Technologies
To advance these initiatives and address dramatic increases in patient responsibility, payment technologies play a crucial role by offering patients easy and secure payment options at every point of the revenue cycle. Let’s take a look at a few ways payment technologies help healthcare institutions achieve their revenue cycle objectives while improving the patient experience:
1. Speed up the revenue cycle and reduce bad debt.
The latest payment technologies allow providers to collect patient payments at all points in the revenue cycle process and throughout the continuum of care. This includes inpatient and outpatient settings, triage or emergency rooms, physician practices, home healthcare and pharmacies.
New EMV-capable terminals, wireless solutions, and mobile point of sale (mPOS) devices allow providers to immediately collect required balances at the point of service and avoid the delays, underpayments and partial payments that lead to bad debt.
2. Increase transaction speed and convenience for providers and patients.
Payment technologies offer fast, efficient, and secure payment processing to speed up healthcare transactions and improve convenience for providers as well as their patients.
Whether processing payments at check-in, at the point of care, or even in the pharmacy drive-thru, the latest solutions offer fast and flexible payments via EMV chip card, magstripe card, or NFC/contactless options such as Apple Pay® and Android Pay®.
Touch screen terminals can also help providers speed up the check-in process and reduce administrative paperwork by offering patients interactivity. This provides a seamless way to capture signatures for consent forms, verify demographics and sign up for loyalty programs, capture charitable foundation donations, and more.
3. Improve the patient experience.
Today’s patients want to know how much they will owe and understand their payment options. They also want more clarity and transparency in their healthcare billing.
According to Navicure, 75 percent of healthcare organizations claim to be able to provide a cost estimate upon request, but only 25 percent patients requested one. This shows that most patients are not aware that they can get an estimate before or at the time of service. These estimates, if provided in a timely manner, can help improve a patient’s experience but also assist the healthcare organization in collecting payments.
The same research also points out that among payment methods, the majority of patients preferred to utilize the credit card-on-file (CCOF) method for charges less than $200. Additional patient preferences include using a patient portal (18 percent), provider website (16 percent) or automated payment plans (9 percent). This shows that patients prefer to pay their bills using credit cards as well as online payments. Healthcare providers also viewed CCOF as the best way to improve payment collection.
Additionally, Forrester Research points out that 72 percent of businesses say that improving customer experience is their top priority. However, the same doesn’t hold true for healthcare organizations. However, according to a survey done by The Beryl Institute, improving the patient experiences is among their top three priorities. This gives patient experience nearly an equal percentage as compared to other key initiatives, such as reducing and managing costs.
Payment solutions offer an ideal way to address these trends in patient preferences. They provide patients with a clear summary of their payment responsibility by allowing them to interact with a smart terminal and review billing details. They also provide the flexibility to make secure payments with cards or via NFC/contactless mobile technologies.
The potential impact of meeting these expectations and improving the patient payment experience is very real.
With these benefits and the challenges of increased patient responsibility in mind, healthcare providers should make payment technologies a fundamental part of their revenue cycle and patient care strategies. This will help them simplify the payment process and shorten the revenue cycle while enhancing the patient experience.
Toward this end, a well-devised payment technology strategy should be at the center of any healthcare provider’s revenue cycle initiatives. The right strategy and the right payment solutions will help providers accomplish their revenue cycle objectives while also improving patient satisfaction.
Download our free healthcare brochure to learn more about simplifying patient payments with seamless and secure healthcare payment solutions. If you have any questions, feel free to request more information on this page.
Jeffrey Fountaine is the Director of Healthcare Strategy, at Ingenico Group / North America