Checking patients' credit scores still controversial

Checking patient credit scores still controversial

As some of you may know, a growing number of hospitals have started working with agencies that estimate how likely it is that a patient will pay their portion of the bill--and sometimes, whether they're likely to qualify for government assistance, too. A recent Wall Street Journal piece provides an intriguing snapshot of the race to win this business.

According to the WSJ, Vendors in this space include Equifax, which has developed a special score separate from its standard consumer credit rating to predict if patients can repay medical bills. (It develops the score by cross-referencing credit reports with hospital payment records.)

Another vendor building speed in this arena is SearchAmerica, which analyzes patient credit bureau data for hospitals. Search America says its client base has doubled, to 900, since 2005 alone. Not only does SearchAmerica generate a healthcare credit score that predicts likelihood of payment, it also helps hospitals guess whether the patient will qualify for financial assistance.

Then, there's a joint venture between Tenet, Fair Isaac and a venture-capital firm that have teamed to form a startup called Healthcare Analytics, which assembles bill-collection histories from hospitals. It plans to use them to develop methods for predicting which patients will pay their bills.

Of course, hospitals need to collect their bills like anyone. What more, hospital execs say, these methods help them identify patients who can realistically pay, rather than uniformly twisting the arms of all patients--solvent or not.

I'm not here to tell you, as healthcare financial leaders, whether to sign on board with one of these vendors. Clearly, from a financial standpoint they have their merits. But I do want to underscore the point that this isn't just about money. As I see it, anything that adds credit analysis to the mix is going to create controversy, unless your collections staff uses a kind of delicacy and tact that aren't the strong points of that profession.

In today's world, consumers are understandably gun-shy about giving away the rights to further investigate their credit histories, even if it stands a chance of getting them qualified for financial assistance. In short, many patients will find the practice very intrusive. In the future, I'd love to know whether my assumptions are off base, and patients accept these procedures without a murmur. I'd also love to hear any horror stories you might have, so I can share them with your colleagues. Write to me and tell me what you think! - Anne