While consumers have embraced how technology has made life easy and convenient, patients and healthcare providers often have a different experience, particularly during the billing and payment process. d’Artagnan Osborne, General Manager of Payment Solutions at Tebra, discusses the need for more innovative strategies when it comes to healthcare payments.
Suppose you are one of the 85 percent of AmericansOpens a new window who use a smartphone or the 93 percent of AmericansOpens a new window who use the internet. In that case, it’s likely some of your daily activities have been transformed by advances in technology. It might be as simple as connecting with family members virtually via FaceTime or Zoom. Or, you may have moved large portions of your life online, regularly ordering food from an online grocer, depositing checks using online banking, or downloading a book the moment you want to read it.
This is mainly attributable to the healthcare industry’s lag in the uptake of technology and the fact that technologies that have made their way into the billing workflows have generally only served as add-ons or replacements for legacy processes that evolved from a paper–and telephone-based environment. This gap has real implications for the time and money involved in paying for healthcare. Moreover, it presents the case for technology, specifically automation, that streamlines this process and fits seamlessly into platforms that cater to the entire life cycle of interactions between providers and patients.
Technology Gaps in Healthcare Administration
This technology gap has real implications for how long it takes and what it costs just to handle the administrative aspects of paying for healthcare. Moreover, it presents the case for using technology, specifically automation, to streamline this process to fit seamlessly into existing platforms that cater to the entire life cycle of interactions between providers and patients.
It’s commonly known that the U.S. healthcare system is the most expensive globally. However, the extent to which those costs are attributable to administrative costsOpens a new window is not as well understood. Administrative costs can account for between 15 to 25 percent of total healthcare expenditures, with a large portion of those costs related to billing activities.
The Admin Cost of Healthcare
A primary reason that billing activities compose such a large percentage of healthcare expenditure is the complexity of our current system, the time required to navigate it and the number of participants involved from start to finish. The process begins even before the patient steps into their provider’s office as staff schedule time and takes an initial set of information from the patient. Once the patient arrives at their provider’s office, the process continues, collecting additional registration information.
The actual patient-provider interaction generates more information, requiring documentation and reporting using medical billing codes. Typically, a medical biller will review a patient’s chart following their appointment to determine the procedure, the diagnosis, and prescriptions. This information must be coded accurately, requiring the biller to select the correct code among thousands of code options for each visit aspect.
Hassles of a Lengthy Process
Claims can be submitted digitally or in a physical format. Once received, the payor reviews the claim and may follow up with the provider for additional clarification. Depending on the submission type and how much code clarification is required, this can be lengthy and require multiple communications between the payor and provider.
Upon accepting the claim, the insurer determines which charges are allowed under the patient’s policy and the amount to be paid by the insurer versus the amount for which the patient is responsible. This is then communicated to the provider, who then issues a bill to the patient. Some providers collect the patient’s portion in advance; however, this is not always possible and is not an industry-standard practice.
By the time the bill is sent to the patient, it may be weeks or months since the visit. More than half of the time, the bill is sent via mail, and paying it requires effort on the patient’s part. It involves logging onto a website with an invoice and credit card number, calling the office, or writing a check and sending it back through the mail. Additionally, costs borne by patients are increasing. These factors create obstacles, resulting in an increase in uncollected bills and physician practice debt. In addition, when bills are not paid on time, practice staff take on the re-issuance of invoices and telephone or email follow-ups. In turn, all of the additional administrative efforts serve to drive the cost of healthcare even higher.
Using Technology to Battle the Rising Cost of Healthcare
While the ability of families to pay is a separate and vital issue, I believe that standard technology already in everyday use can help remove some of the other barriers to payment and help contain the rising costs of healthcare from administrative factors. In addition, as the pandemic created an enormous shift in our way of life, we have a unique opportunity to evolve our workflows and billing practices.
As we quarantined and practiced social distancing, technology enabled us to continue our lives. For example, in healthcare, the practice of telemedicine skyrocketed, with a 63-fold increaseOpens a new window in use among Medicare patients. At the same time, healthcare consumers moved toward digital payments, according to a 2021 survey published by U.S. BankOpens a new window .
While these are encouraging signs, there is room for improvement and better options. For example, the same U.S. Bank survey noted that only 28 percent of patients paid bills online and that patients are looking for more options for online payments.
Pandemic Perspective: Tech Benefits Practices and Patients
Offering digital bills and payment solutions will ease the administrative burden of overstretched staff for whom the pandemic created additional demands and provide an option to shorten revenue cycles and improve practice profitability. Cash flow management is critical for all medical practices, particularly for small- to mid-size independent practices. Reductions in outstanding balances and the costs associated with collections improve the practice’s financial viability and the work atmosphere while enabling all staff more time for patient-focused tasks and interactions.
A technological solution benefits practices, making life better and more convenient for patients. In our world of consumer convenience, informing patients of healthcare costs before treatment, delivering digital bills that employ clear details about services rendered and offering one-click payment options should be the norm.
Enroute to Smarter Healthcare
The beauty of this – from a practice perspective – is that most of these processes can be automated, which requires minimal staff oversight and frees them to focus on other essential tasks. Practice staff can allocate significantly fewer hours to billing to achieve better revenue outcomes and patient experiences. At the same time, providers can be more present during each patient interaction. Practices that have signed onto the entire digital experience save, on average, time equivalent to that of two full-time employees through the automation of administrative tasks, which I’ve personally seen with our billing and provider clients.
There are digital tools available for every aspect of our lives, and healthcare is no different—even if the uptake is slower than other industries. Using automation technology to make the healthcare experience for providers and patients more effective, particularly for billing and payments, means medical staff will have more time to focus on high-quality patient engagement. It also improves access to care for patients and makes it easier to pay with only a couple of clicks on a mobile device. Let’s maximize the potential to improve the healthcare experience through technology and make life less burdensome and more convenient for patients, medical staff, and the industry.
Do you think life would be simpler if healthcare payment processes could be made smarter? Share your thoughts on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window . We’d love to know!
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