Keeping patient payments coming despite a sluggish economic recovery

The Medical Group Management Association’s most recent MGMA Stat poll asked healthcare leaders, “Has your organization changed its policies for patient payment plans in the last year?”

• 27% said “yes.”
• 73% said “no.”

Among practice leaders whose organizations updated policies:

• Many noted seeking to collect more at time of service and becoming more strict about down payments for surgical procedures.
• Several responded regarding adding more flexibility to payment plans and adding new methods of payment for patients.
• Some began enforcing no-show fees.

The poll was conducted Feb. 2, 2021, with 673 applicable responses.

A tough recovery points to coverage and A/R challenges

Many economists are pointing to robust growth in 2021 as the United States continues a slow recovery during the COVID-19 pandemic, but it’s unclear if that improvement will reach medical group practices in the near future.

The Congressional Budget Office (CBO) forecast points to a 1.7% average annual increase in gross domestic product (GDP) between 2020 and 2024, including a 4.6% boost in 2021. However, the same projections point to employment not returning to pre-pandemic levels until 2024.

A slow recovery for jobs is particularly troublesome for healthcare providers faced with managing shifting payer mix and collecting a higher percentage of balances from patients who are uninsured or underinsured. While a July 14, 2020, MGMA Stat poll found that only 26% of healthcare leaders had reported a change in payer mix during the early months of the pandemic, respondents pointed to big increases in the share of Medicaid and self-pay patients.

More than six months later, the extent of the pandemic’s crushing effects on jobs are clearer: About 10 million jobs were lost since the beginning of the pandemic, and the CBO projects only an average of 521,000 jobs returning monthly in 2021.

Beyond assumptions: Asking the right questions

During a recent MGMA Insights podcast, Karen Zupko, president, Karen Zupko & Associates, says that the financial policies and practices that made healthcare providers successful before the pandemic may be outdated.

While unemployment is improving, “high-deductible health plans have not gone away,” Zupko said. At the same time, federal relief efforts such as stimulus payments directly to taxpayers can have big effects on patients who previously struggled. “I’m not going to assume everybody can pay or everybody can’t pay, [but] I’m going to have to train the staff to ask questions to figure out where in this puzzle that particular patient fits,” Zupko added.

Ways that practices can address this situation include:

• Using the federal poverty level (FPL) guidelines as your guide: Measures of income are issued every year by the Department of Health & Human Services (HHS), used to determine eligibility for reduced-cost coverage on ACA marketplace plans. For most healthcare organizations, the point of qualifying for some type of charity care or hardship credit is about 250% of the FPL. “We have to be realistic: If I’ve been laid off and I’ve lost my health insurance, sending me to collections or browbeating me in some other way is just not going to be productive,” Zupko said.
  • Learn more: Download a sample patient financial hardship application from AAFP (PDF)
• Recognize the sensitivity of payment conversations: While many conversations about payments often occur at a front desk, it may also be helpful to have a “private and enclosed space” for sensitive conversations about payment plans with patients who might feel uncomfortable discussing their financial struggles around other patients, Zupko said.
• Having a great patient portal: Clipboards, paper and pens limit both the clinical and business sides of practices. “We want [patients] to fill out their clinical information in advance,” Zupko said, and getting them familiar with that digital platform is a great step toward encouraging prepayment.
• Switch from paper statements to online payment options: As more consumers get comfortable with nontraditional payment methods such as Zelle, Venmo and PayPal, practices need to consider finding ways to digitize statements to reach an increasingly tech-savvy population. (Read more about nontraditional payment options from MGMA Stat.) “You’ve got to meet the patient where they are and what is in their wallet,” Zupko added, regarding younger patients who may not carry a checkbook or even engage via a desktop computer. “Chances are [some patients] are paying with their phone.”
• Understand when you need help: Zupko said that trying to address payment plans on an ad hoc basis can be very difficult. “You are never overstaffed in the business office,” Zupko added, so relying completely on someone on your staff to call and email patients about missing payments or updating payment plans may not be as effective as finding options to automate it. Similarly, use of claims estimators can help cut down on time spent addressing patient financial responsibility and reduce any form of “sticker shock” when patients later receive statements.
• Be proactive when it comes to patients with prior balances owed: Zupko recommends identifying patients with large balances owed and reaching out to them prior to a new appointment to determine what they can and will pay at the time of their next appointment. That information should include a total to be paid, as well as what payment method they intend to use.
• Keep your website information updated: Many practices have outdated policies listed on their websites (e.g., past-year deductibles for Medicare copayments). Plus, any changes to your organization’s payment policies should be reflected on the site so patients searching for that information can better inform themselves before discussing it with your staff or working in a patient portal to make payments.

Other A/R and training challenges

During a recent webinar discussion, an expert panel largely agreed that increasing A/R balances are a big threat for practices, and pose a test of practice leaders’ willingness to relax collection policies in recognition of the financial hardships faced by patients.

• Cameron Cox III, MHA, FACMPE, president and chief executive officer, MSOC Health, noted that more practices need to take a closer look at credit card on file (CCoF) policies, contactless pay options and implementation of eligibility-check tools, as well as looking into patient communication platforms that integrate with your practice management system (PMS).
• Making it easier for patients to access payment platforms should be a priority, Cox added, noting that existing patient portals often are configured more for the providers than the patients. “You’re seeing the rest of the world adapt,” Cox said, noting the improvements some retail pharmacies have made with CCoF. “With the pandemic, it’s requiring us to push” for more digital solutions to facilitate payments.
• Multiple panelists encouraged practice leaders to take a closer look at the front desk staff, as many of those positions suffer from high turnover, lower pay and little education on collections. “I encourage everyone [to] invest in that position — a little more salary and training,” Nan Gallagher, JD, principal, The Nan Gallagher Law Group, said, can go a long way to boost collections and improve patient satisfaction.

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Additional resources

• ACMPE Certificate Program: Financial Management — This 17-hour online program offers in-depth learning of financial management concepts and offers an FMC credential upon successful completion of the program and exams.
• “Improving the patient financial experience” — Karen Zupko’s MGMA Insights podcast details the strain on patients and providers caused by the pandemic.
• “A blueprint to improve the patient financial experience” — An MGMA and CareCredit whitepaper explores strategic tips to educate patients on their financial options.
• “Navigating to a post-COVID-19 financial reality in healthcare” — Get more insights from Cindy Nyberg about tracking year-to-date production variances and meeting the top challenges for 2021.
• “Applying the biggest lessons of COVID-19 to medical practice challenges in 2021” — Hear more from the expert panel featuring Brian Ramos and others about trends in patient-owed balances and collections in 2021.