Should patient deductibles be a profit center?

Anne, great post! Your raise a very good question. Hospitals and caregivers do need to take action in my opinion. The reality is that they already have favorable financing options available however the consumers are not made aware of these options without going through a lot of red tape and countless phone calls. These providers are in a difficult spot though as financial resources have been constrained and therefore they do not have the staff to allocate to place outbound calls to those patients with open balances. The problems with medical debt continue to compound though.

Between 2005 and 2007, the number of American adults (19-64) experiencing medical bill and/or accrued medical debt increased by 25% from 58 million to 72 million. Most of these providers simply "sell" the debt to a collection agency, but that is not a good choice either as they are only receiving $.40-$.60 cents on the dollars collected but at what cost to their brand and local community image?

There are new services called Finanical Advocacy programs which are beginning to gain acceptance by hospitals and payors alike, which do not act in a collection agency manner. They proactively work between the patient, the provider, and the carrier to ensure that the billing is accurate and correct. They help determine what financial situation the patient is capable of working within, and then create a win-win scenario for the patient and the provider. Health Payment Advocates (www.healthpaymentadvocates.com) has been working with a well known national insurance carrier for the the last 9 months and the carrier, the providers, and the consumers are seeing favorable results.

Our large practice that includes 5 locations and an ASC began charging a monthly rebill fee in April of this year for all balances over 30 days. We disclose our policy regarding the rebill fee on the initial statement and in our financial policy to comply with the Consumer Protection Act. This policy has made a great impact on patients paying off their accts who were either previously on payment plans, as well as some who were requesting payment plans. Of course many patients were not happy with this process and let us know that on a daily basis. However, even in this economy our patient balances have dropped considerably and it has not effected our patient volume. For those patients who still fail or refuse to pay their bills, the rebill fees help offset collection agency fees and resulted in low balances meeting qualifications to be turned over to credit reporting agencies.

Also as an incentive for those patients who have received a rebill fee, we tell those patients if they pay the account in full the day they call in we will waive one rebill fee.

Based on our research, rebill fees do not require the same truth and lending requirements as finance charges.

KD
Urology Group

If we can maybe focus on the root cause for a moment, someone might want to take a look at the cost of medical care, 20% of which is administrative costs. Hospital and office bills are high enough without adding a rebill fee(as mentioned in the previous post/reply). The number of medical bankrputcies has risen in the past few years, even with the passage of the 2004 bankruptcy act. Research shows that the insured patient has a higher out-of-pocket expense than the uninsured patient. The patients who do pay their bills in full are most likely giving up something else they need: food or medications, maybe?
Financing patient accounts is not the answer. Lowering the price of hospital and doctor care would be a nice place to start.