Providers can only expect to collect 50–70% of a balance after a patient visit, according to the Trends in Healthcare Payments Annual Report, 2015. This is due to increasing patient payment responsibilities in recent years with high deductible health plans (HDHP) increasing by 255% since 2006.
To break up the likelihood of payment even more, it’s said that within the first 90 days in accounts receivable, the collectability of accounts is 90%. Once accounts reach 90 days overdue, the chance of collecting drops to 50%. At 180 days, the chance of collecting falls to 20%. Account balances that are over a year old have about a 0% chance of collection.
If a patient’s bill exceeds 5% of their household income, the likelihood you’ll obtain payment drops quickly. From patients with high-deductible plans, providers can expect to collect about $0.18 to $0.34 on the dollar.
So, how do you mitigate the issues around patient collection?
First thing’s first: ask patients about insurance and contact information before setting appointments.
When a patient calls your office, you or a member of your team should verify current insurance eligibility. This is NOT a recommendation: it’s a requirement from the federal No Surprises Act. If your patient does not have health coverage and schedules an appointment (or asks for a Good Faith Estimate), you are required to provide the patient with a Good Faith Estimate of the possible charges. Some states (e.g., Massachusetts, Indiana and Ohio) have Good Faith Estimate requirements for those with insurance coverage, so we recommend reaching out to your legal team or looking into local laws yourself to be sure you are following state guidelines.
Consider implementing a tech-driven pre-registration process that completes crucial registration steps with patients prior to their service. According to Healthcare Financial Management Association (HFMA's) “Patient Financial Communications Best Practices,” the physician practice should verify the patient’s demographic data at least 24 hours before a patient’s scheduled service; verify their insurance coverage and benefits; and notify the patient of their financial responsibility.
Pro-tip: Rivet offers eligibility and Good Faith Estimates for those who use or do not use insurance benefits. Keep track of eligibility and estimates for upcoming appointments directly in the app.
How can you accurately collect patient cost estimates up front?
Spend time and resources on software that makes you look good. Collecting from patients at or before the time of service can enhance revenue and decrease funds waiting in accounts receivable.
Pro-tip: Use Rivet to send HIPAA-compliant texts and emails to remind your patients of balances before scheduled appointments so you can collect the maximum amount of A/R before the amounts hit a report.
What is Rivet?
Rivet is a software solution that integrates with your EHR for up-front patient cost estimates (that comply with the No Surprises Act), as well as denied claim and underpaid claim tools.
Download this PDF to see more information about Rivet's products.