Magazine
Intelligence Unit Special Reports Special Events Subscribe Sponsored Departments Follow Us

Twitter Facebook LinkedIn RSS

Revamp Registration, Ramp Up Collections

Are you a health leader?
Qualify for a free subscription to HealthLeaders magazine.

With CDHP and self-pay patients on the rise, hospitals need to tighten front-end focus.

Admit it. If you are a hospital finance leader, patients with consumer-directed or high-deductible health plans tend to make you squeamish. That's because there is so much uncertainty built into the process of collecting from patients on such plans. Patients can be unprepared to pony up for a higher-than-expected copay or deductible, and hospitals may not have the tools to accurately determine what a patient will owe on the front end of the visit.

"The issue is identifying how much of the deductible portion is left because a patient has to meet the deductible before the insurance company is responsible for payment," says Kimberly Hollingsworth, partner, revenue management, with Chadds Ford, PA-based IMA Consulting. Unless a hospital has a sophisticated front-end collections process, these payments may be passing silently to the back end of the revenue cycle, or the dead zone, where collection becomes harder.

Meanwhile, the ranks of patients in CDHPs is growing. This, coupled with a growing number of self-pay patients, means hospitals must, in some cases, revamp the patient registration process.

Currently, more than 12 million patients have a CDHP, says Alexander Domaszewicz, a principal with Mercer in Newport Beach, CA. And, he says, "With or without consumer-directed health plans, the deductibles on traditional plans, PPOs, and indemnity plans have gone up substantially." A 2008 Mercer national study showed the mean deductible for all plans was $1,000 for employers with more than 10 employees.

Beverly Kicklighter, business services manager of Effingham Hospital, says since the the 25-bed critical access facility in Springfield, GA, changed its entire collections process, it is better able to help patients understand their share of the bill and collections have shot up.

When she joined the organization nearly four years ago, virtually nothing was collected up front from patients. And, says Kicklighter, "We did not have an in-house collections department, so that meant that no one was collecting in the back as follow up." Kicklighter started an in-house collections department that included retraining patient access staff. "The registration clerks should know as much about insurance as a biller in order to know how much to collect from patients," she says.

The hospital also now uses software from Nashville-based nTelagent Inc. that includes a script to direct financial counselors on how to talk to patients. The software automaticaly calculates what the patient will owe. Kicklighter says while the hospital sees some patients with consumer-based plans, the new program helps improve collections from all patients. The result is collections are up 86% today. "The first quarter I was here in 2006, front-end registration collected $4,700 for the quarter. Now they collect anywhere from $25,000 to $32,000 a month."

While CDHPs may seem scary, patients on these plans tend to have money set aside to pay their bills. "The reality is those patients might have more resources to pay their expenses than other folks, and they get to pay a pretax as opposed to a posttax in many cases," says Domaszewicz.

Michelle Ponte

Comments are moderated. Please be patient.