The new guidance is an updated version of one originally published in 2014 and emphasizes patient education, clear communications, and transparency in all aspects of the patient financial experience.
The Healthcare Financial Management Association (HFMA) and the Association for Credit and Collection Professionals have jointly published "Best Practices for Resolution of Medical Accounts," a 28-page report that provides guidance to healthcare providers for resolving patient medical bills.
The new guidance is an updated version of one originally published in 2014 and emphasizes patient education, clear communications, and transparency in all aspects of the patient financial experience.
"Education and engagement are important throughout a patient's financial experience," HFMA president and CEO Joseph J. Fifer, FHFMA, CPA, said in a statement. "Transparency is important not only for price information but also with regard to financial assistance policies, identifying sources of coverage, and payment options. These best practices provide concrete, specific guidance to help healthcare finance professionals operationalize that level of transparency."
While many of the best practices are likely familiar to revenue cycle executives, the new report addresses a number of factors that have only come to the forefront in recent months and years.
Here are four key things to look for in the new guidance:
1. Steps before resorting to "extraordinary collection actions"
Hospitals that engage in "extraordinary collection actions" (ECA), such as reporting delinquent accounts to credit bureaus, should take a number of steps before doing so.
The report outlines a checklist of 17 possible steps that a hospital should take before turning to ECAs. Those steps range from making sure the provider has the patient's current contact information and determining financial assistance eligibility to reviewing the patient's credit report and determining whether the patient is likely to sustain their current earnings.
The guidance recommends taking all 17 steps before taking legal action, but fewer before credit reporting or debt sale.
2. How to engage in robust patient communication and engagement
Patient communication and engagement and clear collection policies are key to resolving patient medical bills. The document outlines several elements that are needed for clear patient communications.
For instance, providers should help patients understand their financial responsibility by clearly communicating how much they owe, what their balance is made up of, and options for paying.
It also provides guidance for when these conversations should take place, methods of engagement (outbound phone calls, at scheduling, etc), what should be addressed, and who should be a part of those conversations.
3. Credit reporting best practices
Although not all providers will report patient debt to credit bureaus, those that do should engage in the best practices outlined in the report, HFMA says. For instance, don't report any earlier than 120 days from the date of the first provider statement and only do so after taking the steps outlined in the ECA checklist.
In addition, providers should report back to the credit bureau when the account is resolved and ensure that a "negative listing for medical debt be removed from a consumer's credit report within 45 days of account resolution."
4. Emergency policy change language
Healthcare providers across the country took steps like pausing collections to ease patient financial strain during the height of the COVID-19 pandemic.
The new HFMA guidance includes in its appendices a sample financial assistance policy that organizations can use in a public health emergency.
The policy includes provisions like providing financial assistance to patients affected by the hypothetical public health emergency and assisting with related patient medical bills for testing, symptoms, and treatment.
Alexandra Wilson Pecci is an editor for HealthLeaders.
