Managing the shifting burden of patient financial education: The Impact of the rise in High Deductible Health Plans

Andrew Slotnick


feature-banner-9-19 In a previous post, I discussed five ways that high deductible health plans (HDHPs) will drive change in healthcare. In subsequent posts, I will dive deeper into each of the five changes, focusing on how providers may be affected and how a proactive approach can have long term benefits to healthcare organizations. HDHPs come in many shapes and sizes and the specific terms of their respective health plans are not always clearly understood by patients; shifting the burden of education to provider organizations. Clinical educators serve a valuable role in delivering effective clinical care.  Now, financial educators, armed with technology, are becoming a necessity as provider organizations seek to deliver both comprehensive clinical and financial patient outcomes. There are two major challenges forcing provider organizations to invest in financial education and potentially new technology:

  1. How do we maintain financial viability? Insurance plans across the board are laden with complexity.   From private commercial plans to health exchange plans, provider organizations must be prepared to help educate patients about their health plans…or risk lost revenue. For example, the percentage of workers enrolled in high-deductible plans  ($1,000 or more) has increased more than five times over the past decade, from 4% in 2006 to 26% in 2014.[1]
  1. How do we benefit from increased volume? As coverage expands, so too will the utilization of healthcare services. Under the Affordable Care Act up to 30 million patients will soon gain access to healthcare coverage, many for the first time. The utilization of both inpatient and outpatient elective services could thereby increase by as much as 30% and 40-70% respectively[2] as well.

To put the potential financial impact of these challenges into context, the median consumer copay for an unnecessary ER visit could be as much as 400% higher than an urgent care center visit[3]. Patients who have never been exposed to a formal health plan may struggle with new financial obligations (such as the differences in coverage/cost by site of service), potentially leading to an inability to pay and, ultimately, bad debt. This growing lack of alignment between patients’ understanding and their new financial obligations could jeopardize millions in revenue for a health system and cause undue distress for patients. Technology investments can also help streamline front-end workflows, operationally and financially, to help providers adjust for payment reform and manage increased volume. Automation tools can help implement repeatable, best-practice-driven workflows to help ensure the right information, processes and procedures are followed to maximize collections at point of service. Financial education can help close a patient’s knowledge and behavioral gap.  By working with patients to better navigate the healthcare system, providers ensure their consumers have the insights and comprehension needed to make informed decisions regarding their health plans.  By empowering the financial team, with technology (such as patient portals, liability estimators, point of service collection tools, and task enterprise wide task management functionality) financial educators and revenue cycle leaders will be better equipped to oversee all aspects of a patient’s financial commitment, more efficiently, thereby improving revenues.  Once the volume and knowledge gap challenges are overcome, provider organizations can then shift focus to the upside of officially welcoming newly insured patients into their networks, profitably.

[1]HEALTH CARE SPENDING SLOWDOWN: THE CONSUMER PARADOX EXECUTIVE SUMMARY 14-116 | 5 Dobson|DaVanzo [2] The Impact of coverage shifts on hospital utilization. Levine, MD., Bauman; and Garrett, PhD. [3] McKinsey Center for U.S Health System Reform.

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