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High Deductible Health Plans: Take Accounts Receivable Action Now

The American Journal of Orthopedics. 2017 November;46(6):301-304
November 2, 2017 | The American Journal of Orthopedics
Karen Zupko, BSJ
Author and Disclosure Information

Author’s Disclosure Statement: The author reports no actual or potential conflict of interest in relation to this article. 

Target Your Efforts

What steps can your practice take to help patients pay their portion, even when it’s large, as well as help your practice reduce receivables and avoid collection problems and bad debt write-offs?

Start by analyzing the top Current Procedural Terminology (CPT) codes with patient responsibility, so you can focus your efforts. One such analysis, conducted by our firm, is shown in Figure 3. Although you might think the highest percent of patient financial responsibilities are for surgical procedures, notice that 4 of the top 5 services this practice identified as having the highest amount of patient collectible dollars are rendered in the office-carpal tunnel surgery being the only exception.

Figure 3.
  
Table.
Next, take a look at the total amount of outstanding receivables that are patient responsibility. This requires generating the accounts receivable report in a way that shows insurance receivables and patient receivables separately. The Table provides an example report. It illustrates that $92,000 of the practice’s receivables is patient responsibility. Although $92,000 is only 17% of the total accounts receivable, it is real money, not charges, which is inflated by the practice fee schedule. The $92,000 is money that is 100% collectible, unlike the charges of $436,500, which, if the practice sets its fee schedule as a multiple of Medicare, as many do, will have 50% or more contractually adjusted after reimbursement is received.
Figure 4.
Third, analyze the patient balances outstanding, to determine your approach for your patient collection effort. For instance, in Figure 4, 42% of the outstanding patient balances are <$100. That indicates a need for the practice to implement point of service collections since; at least 70% of these amounts could have been collected before the patient left the office. 

Take Action 

After conducting a thorough analysis and reviewing the results, here are 5 actionable steps your practice could take: 

1. Make sure your patient portal has the capacity to take patient payments. Offering online payment options increases the opportunity for patients to pay. Promote this option on the patient statement.  

2. Implement a system of collecting from patients before they leave the office. After a new visit, which involves a more expensive evaluation and management code, and possibly imaging and durable medical device, counsel patients to leave a credit card on file, so the minute insurance pays, their credit card can be charged. 

The 2017 Navicure Patient Payment Check-Up survey8 conducted by Healthcare Information and Management Systems Society (HIMSS) Analytics shows that 78% of patients would provide a card to be charged for one time up to $200. Think about the previously illustrated collection amounts this would alleviate.

3. Provide all surgery patients with a cost estimate. Generating cost estimates has been possible for close to 10 years. It’s done through your clearinghouse and practice management software by entering the CPT codes and diagnosis codes, along with the patient’s information. Save time and avoid tying staff up on hold. 

According to the Navicure Patient Payment Check-Up survey,8 75% of provider organizations are able to provide a cost estimate upon request. It makes good business sense.

4. Collect a pre-treatment or pre-surgery scheduling deposit. In the KarenZupko & Associates/American Academy of Orthopaedic Surgeons (AAOS) pre-course survey of those attending the 2017 coding and reimbursement workshops, 55% of orthopedic practices reported that they have instituted such a practice. With the proliferation of HDHPs, asking for a scheduling deposit is fast becoming a must for all surgeons.

5. Offer patients a healthcare financing option through a third party. In response to another pre-course survey question, about offering CareCredit or another healthcare credit card, 28% of orthopedic practices say they do. Still, that leaves >70% of the orthopedic patients without a financing option. Given the reality of high deductible HDHPs and the patient responsibilities going uncollected, it’s time surgeons take a look at financing. It’s a fool’s wish to believe the practice is “saving” the service fee by sending dozens of statements, having staff make calls, and ultimately writing off unpaid balances as uncollectible.

Practices that fail to change, will fail to prosper. Those who have technology-phobic staff will suffer as healthcare continues to automate. Practices led by surgeons like one recently interviewed who said, “If patients knew how much it cost, they’d never schedule” will see patient accounts receivable soar and patient online ratings sink. The first quarter of 2018 means the number of patients with HDHPs will increase and that deductibles will have to be met. It’s wise to have a full staff meeting, share the facts, and put an action plan in place.

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