Increasing patient responsibility is becoming more prominent in healthcare than ever before. More patients are enrolling in high deductible health plans (HDHPs), which require patients to pay a minimum deductible amount before their health plans cover any portion of the cost. In 2010, 10 million consumers were enrolled in HDHPs. Less than a decade later, 75 million consumers are enrolled in HDHPs, a more than seven-fold increase.
The trend of increasing patient responsibility requires providers to rely on patients for a larger portion of their revenue. The burden to collect from patients has become a growing concern and forward-thinking providers are turning to automated payment options, which assist in collecting revenue that might otherwise go uncollected for healthcare organizations. Automated payment channels leverage an electronic payment method saved on file to collect a patient payment automatically.
Providers are seeing success with automatic payment processes. Sierra Pacific Orthopedics is a comprehensive muscular skeletal practice in Fresno, California that serves up to 500 patients a day with a staff of 22 physicians and 50 total providers. Sierra Pacific Orthopedics faced significant increases in patient responsibility and no clear or simple way to collect these payments. The practice needed a way to increase collections without significant staff work and with support for integration with their practice management system.
Joe Clark, CEO of Sierra Pacific Orthopedics, voiced his frustration, “If a patient has not paid their balance, providers essentially loan them that money without any assurance of payment. Medical groups practice medicine; they are not creditors. We needed a way to make sure patients paid their responsibility without any additional costs to collect.”
Sierra Pacific Orthopedics approached the challenge of collecting from patients from two angles: implementing new technology to automate payment collections and changing their collection process. To automate collections, Sierra Pacific Orthopedics leveraged the InstaMed Auto Payment Collect™ solution. With this solution, Sierra Pacific Orthopedics is able to securely save a patient’s payment method on file and automatically collect patient responsibility when a claim is adjudicated. As a result, statement printing is automatically suppressed and all manual processes to collect are eliminated. The patient receives an email receipt and the payments automatically post into their practice management system.
However, Sierra Pacific Orthopedics understood that for this new technology to be effective, they had to adjust their process for collecting payments. Their staff was trained to change conversations they had with patients and talk about patient responsibility upfront. They also established a new billing policy that required all patients to keep a payment method saved on file and made sure staff explained to patients that payment would be automatically collected once a balance was due.
The results were astounding – Sierra Pacific Orthopedics automated over 80 percent of patient payments in the first year, decreased bad debt by 35 percent and decreased payments that required manual posting and reconciliation by 63 percent. Clark is pleased with the results, “More than 80 percent of our payment collections are automated, and that number is growing every day. The best part is that we are guaranteeing more revenue with fewer resources, in less time and at a lower cost. As a result, the practice’s days in accounts receivable have decreased by 16 percent and the percentage of patient balances over 90 days has decreased by 44 percent, reaching an all-time low.”
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Don’t let the learning stop there! InstaMed invites you to register for the InstaMed User Conference 2018. Joe Clark of Sierra Pacific Orthopedics will present his session, “Providers Aren’t Lenders: Shifting the Economics of Patient Collections” and share tips on how to successfully implement a card-on-file program to address the challenges of increasing patient financial responsibility at your healthcare organization.
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