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Online Recurring Payments Cut Bad Debt Simply, Cheaply

Karen Minich-Pourshadi, for HealthLeaders Media, November 8, 2010

For many hospitals and health systems, keeping patient bad debt under control is like pushing a 2,000-lb. boulder up Mount Everest. No matter how strong the facility is financially, bad debt has a way of crushing a lot of fruitful cost-cutting efforts. What if you could change just one thing on your system and suddenly start to see your bad debt turn into revenue? You can, if you add an online recurring payment option.

It’s not new, but online self-service payment technology is far from mainstream at hospitals nationwide. And those that have an online payment option may not have set up a recurring payment feature. That's a missed opportunity for hospitals, however, as there are more than a few greenbacks to be garnered by adopting the same technology that retailers have been using online for years.

That’s exactly what Winter Park, Fla.-based Adventist Health System discovered. Adventist, which ranks as the largest nonprofit Protestant healthcare provider in the nation, began seeing the financial benefits of adding recurring payment technology to its website in the past year.

Since November 2006, Adventist Health System, which provides care to more than four million patients annually, has had online payment capabilities, but something was missing. Tim Reiner, vice president of revenue management for the 7,700-bed health system explains that for nearly nine years his team has made it a priority to work with patients to secure their portion of the bills, but they couldn’t hit on the right formula to increase payment numbers. While it had improved point of service collections overall, Adventist was still seeing high amounts of unpaid patient debt.

It’s estimated that hospitals and health systems collect anywhere from 35%?65% of the remaining patient balance after insurance—Adventist calculated that percentage to be around 58%.

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