As patient responsibility increases, physician practices should consider how they can make it easier for patients to pay their medical bills.
The patient payment experience is in critical need of an overhaul. Rapidly increasing payment responsibility and outdated collection practices have created an environment where the financial stakes for patients have never been higher. In fact, 93 percent of patients were surprised by a medical bill in 2018. Despite advances in technology, the payment process has not gotten easier.
Physician practices feel the stress of the poor patient payment experience, too. In 2018, 67 percent of providers said that their primary revenue cycle concern was patient receivables. Their concern is justified, as 81 percent of providers cannot collect $1,000 or more in 30 days while 77 percent say it takes more than a month to collect any payment.
When Dallas Nephrology Associates (DNA) first opened its doors nearly 50 years ago, the patient payment experience was simply nonexistent. Back then, physician practices relied almost exclusively on payers for revenue, and patients seldom had a bill due for any remaining responsibility. This scenario is no longer the norm.
High-deductible health plans (HDHPs) have spurred much of the increases in patient payment responsibility. In 2018, 85 percent of patients with employer-sponsored healthcare had to meet a minimum deductible before most services were paid for by their health plan, up from 59 percent in 2008. The deductibles themselves have increased as well. The average deductible increased from $735 in 2008 to $1,573 in 2018.
HDHPs are but a single contributor to the trend of increased patient responsibility, which also includes copayments and coinsurance. All total, consumer out-of-pocket spending reached $416 billion in 2014 and is expected to total $608 billion in 2019.
The consequences of ignoring the rise in patient payment responsibility are no longer restricted to payment collection. Patient satisfaction now shows a strong connection between the payment experience and provider loyalty. In fact, 61 percent of consumers would consider switching healthcare providers for a better healthcare payments experience.
Consequently, we knew we needed to change our ineffective collection methods. DNA’s primary collection method was to send a paper statement via the U.S. Postal Service after a patient visit. As payment responsibility increased, solely relying on paper statements became unsustainable.
In addition to high print and postage costs, staff were constantly working one-on-one with patients to help them understand costs and then take the payment manually - severely slowing down all patient collection efforts. However, frequent staff trainings did little to address the larger problem of patient education about what they owed or how to make a payment.
Instead of continuing with business as usual, DNA made the strategic decision to improve financial engagement with patients. We considered consumer behaviors. We knew that any process or technology changes needed to meet consumer expectations and create convenient, transparent and frictionless experiences. Our goals included helping patients better understand payment responsibility, making it easy to pay and reducing the volume of paper bills mailed.
With these considerations in mind, DNA identified three patient touchpoints where we could improve patient financial engagement: check-in, patient statement and online payment.
DNA started by focusing on patient check-in. Our idea was simple. We realized the sooner the financial touchpoint, the more knowledgeable patients would be about their payment responsibility and available payment options.
Initially, DNA selected a mobile check-in solution that required purchasing tablets to be shared among patients. However, patient questions about the accuracy and reliability of the information presented on the screens ate up significant staff time. There were also considerable complaints from patients about hard-to-read text and the unsanitary nature of sharing handheld devices.
Ultimately, we decided to ditch the shared tablets and will instead be implementing a check-in solution using a bring your own device, or BYOD, approach. The new solution will allow patients to manage the entire check-in process on their own smartphone or tablet, including view benefit information, make payments and access self-service payment tools like a digital wallet and payment plans. The new DNA check-in experience will also put patients in the driver seat of their financial experience.
Patient sentiment reveals a BYOD solution may be key to overhauling the payment experience in the industry at large: 80 percent of patients want to check in for a provider visit from their own secure mobile device and 65 percent would download a mobile app to pay all their healthcare bills.
While only 17 percent of consumers receive their medical bills electronically, 71 percent want to enroll to receive eStatements from their physicians and healthcare providers. DNA interpreted this disconnect between patient availability and preference for eStatements as an opportunity to improve our accounts receivables. However, instead of eliminating paper statements altogether, we made the strategic decision to leverage paper statements as a tool to promote an online portal where patients can pay and enroll in eStatements.
The first step was to redesign our statement layout to feature the URL to the online portal and directions to set up an account. Perhaps even more impactful was that DNA eliminated the tear stub and return envelope from the statement to discourage paper check payments. Though this may be viewed as a risky change to enforce on patients, we felt it was important to achieving our patient engagement goals.
We were happy to hear very little negative patient feedback regarding the missing tear stub. Some patients who had been with the practice for a long time and were accustomed to paying with paper checks were surprised to see that we had stopped including a return envelope. However, staff explained to these patients that they could pay online with their bank account via an eCheck.
We understood that if we were going to drive patients online with our new statement layout, we needed to offer a patient portal that made paying healthcare bills effortless. To support this initiative, we chose an online portal that offers patient-friendly functionality, including a secure digital wallet, detailed payment history, automatic payments and flexible payment plans. Patients can sign up for eStatements on the portal, helping DNA to further reduce our mailed statement volume.
After implementing the new patient statements, DNA saw the following results:
As the nation’s largest nephrology practice, DNA wanted to improve financial engagement throughout the patient encounter. Our statements proved to be the right opportunity to connect with patients using online and electronic channels they are familiar with in other industries.
We built on that success by further optimizing the touchpoints surrounding the statement, especially at patient check-in. DNA is proud to offer patients a payment experience as seamless and convenient as paying their other bills.
Ed Davis is director of information technology at Dallas Nephrology Associates.