One of the by-products of the Affordable Care Act, the so called Obama Care, is the rise of high deductibles. High deductibles have always been around; the difference is the volume. In most practices, the volume of high deductibles has been sparse as most patients are either covered by their employers or government in the form of Medicare or Medicaid. This meant that practices could see patients with non-emergency visits and collect whatever the patient said they could pay without affecting the cash flow of the practice. With the advent of the ACA, the volume of patients with high deductibles will inevitably go up and that is a dilemma for many practices.
The media debate basically falls into two camps. Should a healthcare practice potentially force a patient and their family into debt by demanding payment in full of these deductibles prior to being seen by physician?
On the provider/hospital the argument is, “We’re seeing a shift to patients with more high deductible plans, and it’s causing an increase in bad debt expense,” Dale Maxwell, senior vice president and chief financial officer, Presbyterian Hospital in Albuquerque, NM recently said. “The revenue pressures we are facing here are significant.”
Indeed, as Bloomberg News reported, increasing numbers of clinics and hospitals refuse to provide non-emergent care to patients unless they pay the full amounts upfront. The downside to this position is that the chronically ill patients will not follow-up with physicians as often as they should and their chronic illnesses become acute. And isn’t that the very argument that prompted the need for more affordable insurance in the first place?
Each practice must take the time and thought needed to develop a policy that works for that practice. Collection of payment at time of service is becoming the most popular and most followed practice. The question with most high deductibles is how much to collect at one time? Projecting cost of treatment at each visit and collecting the estimated amount is a practical solution.
There will always be patients who simply fail to pay for healthcare costs even as there will always be patients who feel the responsibility to pay for treatment and care received but who cannot afford the care and look for alternative payment options.
How a practice determines to work with patients with high deductibles or no insurance for payment of services is probably the most needed policy at this moment of time in the business of healthcare discussion. A policy decision based on the values of the practice will be well received by patients if communicated in a straightforward way and applied consistently. Communication to patients is always appreciated by patients. Dealing with individual cases that fall outside the norm should be managed as that, outside the norm.
Take a look at your practices collection policy and determine if it is the right policy going forward.
To take a deeper look at options by specialty download and read our white paper “The Self Pay Puzzle.” It will provide you with the tools you need to make the right decisions for your practice