Upfront CollectionsBest Practices

1
Upfront Collections-Best Practices

• Presented to Maine Chapter of AAHAM
• September 19, 2008
• Sugarloaf, Maine
• Jonathan B. West, Revenue Cycle Solutions contact
  jonathan.west_at_passporthealth.com

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Market Trends

• More patients are paying out-of-pocket
• Changes in self-payments including
• Increased co-pays
• Coinsurance payments
• Deductible payments
• Out-of-pocket payments for uninsured

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Market Trends
More patients are paying out-of-pocket

• Deductibles are growing due to HDHPs.
• 1.3 million have an HSA (1 of total insured
  population)
• 8.5 million have high deductible plans without
  HSAs. (Per the Employee Benefit Research Group
  2006 Survey)
• 1 billion dollars invested in HSAs by Americans
  (according to data gathered by inside
  Consumer-Directed Care (ICDC) newsletter Feb. 24
  issue )

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Market Trends

• A health insurance plan must meet the following
  criteria to be considered HSA-eligible in 2007
• The health insurance plan must have an annual
  deductible of at least 1,100 for individuals and
  at least 2,200 for families.
• 59 of individuals with HSAs have HDHPs with
  deductibles in excess of the minimum required.
• 67 of families with HSAs have HDHPs with
  deductibles in excess of the minimum required.
• The sum of the annual deductible and the other
  annual out-of-pocket expenses required to be paid
  under the plan (other than premiums) does not
  exceed 5,500 for individuals and 11,000 for
  families
• Numbers are indexed annually for inflation

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Market Trends

• Below are the estimated recovery percentages by
  control point
• Pre-Admission (100)
• Admission (75-80 )
• Inpatient (65-75)
• At Discharge (60-70)
• One Month After Discharge (lt40)

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Market Trends

• Best Practices Related to Point-of-Service
  Collections
• Survey by the Point-of-Service Revenue Capture
  Advisory Board noted
• 24 of healthcare facilities reported having NO
  collection process in place at the time of
  service
• 52 reported having a limited collection process
  in place

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• What can you do to gain success in your
  collections efforts?

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Process Improvements Pre-Registration

• Verify eligibility, electronically, if possible,
  2-3 days prior to patients arrival.
• If insured, calculate what the patients
  financial responsibility will be including
  co-pays, deductibles, and co-insurance.

• Tip Call the patient prior to the visit and
  inform them of their financial responsibility.
• - All elective procedures should collect 100
  due prior to patient arriving.

• Tip If patient will be self-pay, establish what
  their flat rate fee will be prior to talking to
  the patient and perform a credit evaluation to
  assess their ability to pay.

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Process Improvements Pre-Registration

• If uninsured, ask for payment before the patient
  arrives.

• For your convenience, if you have a credit
  card, I would be happy to take the number over
  the phone and we can process your payment. This
  way, you wont have to worry about remembering to
  bring in your credit card and we can register you
  faster when you come in.

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Process Improvements Pre-Registration

• Deliver a consistent message to patients about
  their financial responsibility and continually
  educate them on their specific benefit plan.
• Use a Patient Financial Obligation Statement

Tip Statement content can vary from illustrating
co-pay, deductible and coinsurance information to
much more complex calculations, such as those
that are procedure-specific (charge-master) and
payer-specific (contractual database).
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Process Improvements Pre-Registration

• and provide detailed explanations where
  appropriate.
• Train registration staff on how to present the
  forms and create scripts to support the process
• Allow time in the registration process for the
  registrar to more fully review the forms with the
  patient or consult with the hospitals financial
  counselor.
• Have the forms signed and return a copy to the
  patient.

Highlight key patient statement areas,
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Process Improvements Admissions

• Perform an electronic eligibility request for any
  changes to plan benefits.
• If uninsured, run a patient demographic search.
• Train registration staff to read responses more
  easily and accurately
• According to hospital collection policies request
  payment for appropriate amounts. (20 co-pay)

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Process Improvements Inpatient Financial
Counseling

• Collecting money from patients can be both a
  challenge and a delicate situation if not handled
  properly.

• Remember their care is a higher priority
  than collecting payment.

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Process Improvements Inpatient Financial
Counseling

• Remember that collecting prior to discharge is in
  the best interest for both the hospital and the
  patient.
• For the hospital, it improves overall collections
  and saves time and money having to bill patients
  after service.
• For the patient, it minimizes post-service
  financial concerns.

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Process Improvements Inpatient Financial
Counseling

• Sample script with insurance
• We have verified your benefits. The good news
  is your insurance company is covering the
  majority of your bill. Today all you are
  responsible for is XX. How would you like to pay
  today cash, check, or credit card?
• Increase points of collections

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Process Improvements Inpatient Financial
Counseling

• If the patient is unable to pay all or a portion
  of their bill prior to discharge, set up payment
  arrangement's based on your hospitals policy.
• Make sure the agreement is in writing and that
  the patient signs the agreement.
• If someone other than the patient is paying the
  bill address.

Tip Hold regular training sessions with staff to
practice and role play common collection
scenarios encountered. This will increase your
staffs confidence.
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Increase your collections

• Collection of elective service deposits prior to
  service should be 100.
• Collection of inpatient pay balances prior to
  discharge should be greater than or equal to
  65.
• Collection of inpatient pay balances prior to
  service should be greater than or equal to 75.
• Collection of emergency department patient-pay
  balances prior to departure should be greater
  than or equal to 50.

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Increase your collections

• Checking eligibility on a patient yields many
  benefits including
• Decreasing the cost you bear in order to
  reprocess a claim
• A cost of capital because of the lag time in
  receiving payment
• A claim denied due to the patient not being
  covered means there is a loss in the value of the
  claim.
• Some hospitals convert these claims to self-pay
  and turn them out to collection while others
  begin an internal process of researching if there
  is other coverage or if the patient can pay. In
  either case, the odds of collecting the full
  amount drop significantly.

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Increase your collections

• Hospitals have shown that by accepting credit
  card payments cash at point of service has
  grown in the short term (less than a year) by
  over 200 to almost 1000 after a few years.
• Bad debt has decreased by over 20
• A/R over 90 days has decreased by over 60
• A/R days has decreased by over 45

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Increase your collections

• Set realistic goals for your registration staff.
• Create employee incentives for positive
  performance.

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Increase your collections

• Proliferate the facility with point of payments.
• Accept all major credit cards.

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Increase your collections

• Train your staff on how to ask for payment.
  Introduce scripts if necessary. Prepared answers
  for the more common objections for non-payment
  will give your staff the confidence to be more
  assertive.