In an era of high deductible health plans, it's critical that ASCs deploy strategies for sustained patient financial engagement, according to AccessOne President and CEO Mark Spinner.
AccessOne provides patient financing solutions to healthcare providers. Mr. Spinner explained to Becker's ASC Review how increasing patient financial responsibility is affecting ASCs.
Note: Responses have been edited for style and clarity.
Question: More patients are paying for healthcare services out-of-pocket. How is this trend affecting ASCs?
Mark Spinner: ASCs are an attractive option for patients with high deductibles because charges for care delivered in ASCs are significantly lower than those of hospital outpatient departments for the same procedure. One analysis of commercial medical claims found patients save $5 billion a year in the form of lower deductibles and copayments by relying on ASCs rather than hospital outpatient departments for their care. But the rise in cost-shifting to consumers through high deductible plans and higher copayments have had a deep impact on ASCs:
- Collection rates for out-of-pocket costs are slower, with an uptick in bad debt.
- Patients are increasingly focused on cost, and this impacts their decisions around whether to seek treatment. In fact, 40 percent of people with employer insurance coverage reported that they have had trouble affording a healthcare or insurance cost in the past 12 months, according to a recent KFF/Los Angeles Times survey.
- With the intense focus on out-of-pocket costs of care, ASC administrative costs for billing activities are increasing.
These challenges demand that ASCs navigate discussions around patient financial responsibility for care — including how patients will pay for their out-of-pocket costs and whether patients require a payment plan to cover the amount due — during the registration process and at the point of service.
Q: What will ASCs have to change about their billing/collections processes in response to this trend?
MS: In an era of high deductibles, ASCs must increase payment plan flexibility to keep patients engaged in paying out-of-pocket costs of care. Simply offering a payment plan isn't enough. Patients also need to know that ASCs will work with them to adjust the terms of payment if their financial circumstances change.
It's also important to offer a variety of options for payment. AccessOne research shows strong interest in financing options to cover out-of-pocket costs of care. Fifty-four percent of consumers say they would use a low-interest or zero interest payment plan for a healthcare balance under $1,000. Meanwhile, 46 percent would enter into a payment plan for balances higher than $1,000.
Q: Do you think it's harder for ASCs to adapt to increasing patient responsibility than it is for hospitals? What advantages or disadvantages do ASCs have?
MS: ASCs have an advantage over hospitals in that much of their volume are planned procedures and they may perform more elective procedures. This means patients typically tend to be better prepared for up-front discussions around out-of-pocket costs. But as one 2018 study shows, the increase in high deductibles also means ASC staff are spending a lot of time fielding questions around insurance and billing — an average of 75 minutes per patient, at a cost of about $170.40 per patient. That's a lot of time and a lot of money that could be saved through more patient-friendly approaches to financial engagement. For example, ASCs should consider offering a patient portal where patients can estimate their costs of care based on their procedure, their insurance coverage and the amount of their deductible met to date.
They should also consider self-service features that enable patients to self-enroll in payment plans — ideally, prior to the date of service. Putting self-service tools in the hands of patients significantly reduces administrative costs while empowering patients to take charge of their accounts. It's important that self-service tools for managing payment plans include options for adjusting payment terms — such as moving from a zero-interest plan to a low-interest option — when the patient's financial circumstances change. This enables patients to communicate their needs privately and from any device and receive assistance. It also lowers the risk of bad debt for ASCs.
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