In 2019, almost 50% of all insured individuals were insured through employer-sponsored plans. In the early months of the COVID-19 pandemic, the unemployment rate climbed to a high of 14.7% before dropping to between 7.9 and 8.3% as of September 2020.
Some experts estimate the true unemployment rate to be between 11 and 12% if workers who have left the job market entirely are counted.1
What do these numbers mean to health systems and to the insured patient population? Many of these newly unemployed patients will lose their employer-sponsored coverage and be forced to find coverage elsewhere. Those who can’t find coverage will join the uninsured population. An August 2020 study by the Urban Institute2 estimates 10.1 million workers and their dependents will lose employer-sponsored coverage. Of this number, between 2.8 million and 3.3 million will enroll in Medicaid. An additional 2.9 million will become uninsured.
A Kaiser Family Foundation article published on October 15, 20203 analyzed CMS Performance Indicator Project Data. This analysis indicates that Medicaid enrollment has increased by 3.4 million individuals, or 4.8% when comparing adjusted data from February 2020 to preliminary data in June 2020. Enrollment is expected to grow as the pandemic continues to negatively impact the economy.
How can hospital-based providers best approach this influx of new Medicaid patients and ensure that all Medicaid-eligible patients treated are identified so that claims can be filed within timely filing limits? Federal law provides for retroactive Medicaid benefits for three months prior to the month in which the patient’s Medicaid application was submitted. However, some states have changed this rule after being granted Section 1115 waivers. One of the most effective and efficient ways to identify the patients with Medicaid coverage is by using an insurance discovery and self-pay analysis tool.
Often, patients that may qualify for Medicaid only seek medical care in acute situations that make obtaining insurance information difficult. When the patient is stable and ready for discharge, registration personnel are confronted with having uncomfortable income discussions with patients related to paying for treatment. These discussions are sometimes avoided, and patients who may have qualified for Medicaid or charitable giving programs leave the hospital in the same uninsured financial class in which they arrived. A self-pay analysis tool can easily determine a patient’s propensity to pay, likelihood to qualify for Medicaid, or to qualify compliantly for a hardship discount. Registration staff can use this data to assist patients in applying for Medicaid or other financial assistance.
ZOLL Data Systems estimates that up to 5% of uninsured patients are Medicaid eligible, but how can this coverage be identified efficiently and in a timely manner after a patient has left the hospital? This is where an insurance discovery tool is beneficial. Insurance discovery tools use patient demographic information to check various insurance company (including Medicaid) databases to determine if a patient has coverage that wasn’t disclosed at the time of treatment or if a patient has been retroactively granted coverage. Most insurance discovery tools can be automated to run all uninsured patients in a batch file, removing the need for billing staff to make manual checks of websites and databases.
Ultimately, using self-pay analysis and insurance discovery tools provides two major benefits: 1) Increased revenue through timely identification of valid Medicaid (or other billable coverage) for patients initially classified as uninsured; and, 2) Potential savings realized through increased productivity and automated workflows for patient eligibility, identification, and verification tasks.
How do these tools stack up? A hospital may only collect an average of $18 for each uninsured patient visit, while collecting an average of $75 for each Medicaid visit — a more than fourfold increase. An emergency department with an annual volume of 36,000 visits and a 10% uninsured population accounting for 3,600 visits will likely find Medicaid coverage on a minimum of 180 visits. That translates into a $500,000.00 average gain in additional revenue from commercial and Medicare coverage. The average cost of running accounts through an insurance discovery tool is approximately $2.00 per account, yielding a measurable profit. When extrapolated across the entire healthcare system, the positive financial impact cannot be denied.
Along with additional revenue, these tools can help providers and hospitals realize savings in reduced staff time dedicated to manual discovery processes and lower mailing expenses associated with sending statements to uninsured patients. Staff previously assigned to working these accounts can be reassigned to other revenue generation roles while searching for retroactive Medicaid eligibility can be handled automatically in the background.
As hospitals and providers seek to obtain fair and appropriate payment for the services they provide, innovative, cost-effective solutions are no longer simply helpful. Rather, they have become essential. If you have not already procured a real-time, best-in-class solution such as ZOLL AR Boost® for self-pay analysis and insurance discovery, now is the time to do so.
This article is a collaborative effort with ZOLL Data Systems.