A Call to Action 20 Years After “To Err Is Human” – Getting to Zero Patient Bad Debt

Posted on: August 1, 2019

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By Laurie Heavey, VP Strategic Marketing

 We all know that patients carry more of the payment burden for their medical care. And with so much negative publicity about sending patients to bad debt collections, health systems need to manage a delicate balance between collecting what they’re rightfully owed and giving patients reasonable payment options. The good news is we have solutions. In fact, it’s incumbent on us to adopt the grand idea that there should be no reason a patient goes to bad debt. Forget the complexities of where insurance falls in the reimbursement mix for a moment. The reality is that the demand for healthcare affordability and the need to reduce bad debt are fundamental to the livelihood of the healthcare industry.

 We have an opportunity to create new possibilities to target zero patient bad debt. During the last century, we’ve seen great achievements in healthcare. Twenty years ago, a group of business leaders gathered to discuss a way to transform healthcare. From that, the Institute of Medicine in 1999 published the groundbreaking report, “To Err Is Human,” which revealed that 98,000 people die every year due to medical errors. Our industry was galvanized to find solutions, and we did. We’re at a turning point again, with healthcare costs soaring and consumers who want to pay their fair share, if they have financing options.

The good news is that we have the focus, tools and determination to tackle the issue of patient bad debt. Most healthcare organizations have a patient pay strategy in place, meaning they understand the implications of bad debt and are taking steps to make healthcare affordable. According to our Patient Pay Trends Survey, 67 percent of respondents — CFOs, patient experience officers and VPs of revenue cycle — said patient reimbursement is critical to their organization’s bottom line. In fact, 84 percent said their patient pay strategy includes some combination of financial estimates, counseling, long-term payment options and patient self-service. During the last couple of years, we’ve seen a lot of activity around patient self-service. This is positive within the context of a broader patient engagement strategy that sustains patient interaction and accountability to repay their out-of-pocket costs.

Finally, there’s the patient’s role in getting to zero bad debt. A 2018 study by Waystar and HIMSS showed that of 1,000 individuals, 34 percent couldn’t pay their elective surgery bill. Of those, 70 percent were offered a payment plan, and 85 percent enrolled. Our health system partners that offer ClearBalance® patient financing will tell you: Most patients will pay what they owe, if you give them an affordable repayment path.

 Our long-term vision is that no patient should go to collections. We believe that patient bad debt can be eliminated through a cohesive revenue cycle strategy that includes long-term financing. As an industry, we owe it to ourselves and to our patients to take on this grand idea of getting to zero patient bad debt.