Patient-pay medical cost obligations are growing at roughly 20 percent annually, so health systems must position for a new era where reimbursement from both commercial payers and patients is paramount. The two-payer reimbursement strategy should meet the needs of patients who want to pay their medical bill but need an affordable option, as well as those patients who can pay their medical bill but expect retail payment terms. More health systems recognize the ClearBalance® consumer-friendly loan program is a critical tool in their patient pay arsenal. In fact, in just the last two months, a record number of health systems across the United States began offering the ClearBalance program to their patients.
“Healthcare insurance coverage is at an all-time high, but most Americans still struggle to pay out-of-pocket medical expenses,” says ClearBalance President and CEO Bruce Haupt. “As a result, they will put off major household expenses, cancel vacations and worse – delay care, ultimately ending up in the most costly care setting of the ER.”
The rise in patient pay isn’t confined to one geographic location or age group, Haupt adds. That’s why major health systems in California, Connecticut, Idaho, Kentucky, Ohio, New Jersey, North Dakota, Ohio and Texas have joined the ClearBalance client roster. In addition, several existing clients have expanded their use of the ClearBalance program to other hospitals, medical group practices and outpatient sites.
Maintaining revenue is probably the biggest challenge for healthcare organizations today, and a stumbling block is the shift in the payer mix, Haupt says. Healthcare providers once relied on the higher reimbursement rates of private insurance to cover the low- to below-cost reimbursement rates of Medicare and Medicaid. Now they must turn their efforts to what the patient can pay, which is more difficult, time-consuming and less profitable. Health systems collect 98 percent of what they’re owed from payers; by contrast they typically collect only about 40 percent of balancs due from patients.
In response, many health systems have beefed up point of service collections. “It’s crucial to engage patients in the ‘what-you’ll-owe conversation’ sooner in the process, but focusing solely on point of service collections is not a panacea,” Haupt says. “Providing a long-term payment option as part of a comprehensive patient financing strategy can actually boost up-front collections. Financial counselors are more willing to have the ‘money talk’ because they can discuss the loan program option.”
Novant Health, a multistate healthcare provider, offers patients the option of repaying their cost of care with the ClearBalance zero-interest loan program. April York, senior director of patient financial services, agrees that the ClearBalance program enables financial counselors to elevate their conversation and offer patients reasonable payment options. “Patients are consumers who have a voice and choice in their health care,” she says. “Our patients are more satisfied knowing what they will likely owe ahead of time and that they have an affordable repayment option. Our goal is to give patients peace of mind to focus on their care and recovery.”
Since converting from an internal payment plan program to the ClearBalance program in 2012, Novant Health has decreased payment plan collection costs 20 percent and even improved patient cash collections 15 percent. The ClearBalance program provides a 90 percent collection rate. Novant Health also boosted patient satisfaction, according to a healthcare consumerism survey: 92 percent of patients who use the loan program said they would return for future services and 85 percent said they would recommend Novant Health to family and friends.
“People don’t choose to get sick or have accidents. So health care as a service business is a different experience from Disney and Starbucks,” Haupt says. “Yet, you want your organization to be the one that comes to consumers’ minds when they need care. Each interaction during a patient episode is an opportunity to create a longer-lasting relationship. That includes providing patient pay options that make care affordable.”
ClearBalance partners with health systems to provide consumer-centric affordable care while improving net recovery of patient pay and overall financial performance. We have served more than 4 million patient accounts and maintain the industry’s highest patient loan repayment rate. Our program enables patients to easily pay their medical costs and engenders loyalty, positioning the health system as the care location of choice in its community. The ClearBalance ROI Value Model™, Peer Reviewed by HFMA, establishes nationally recognized patient loan program performance standards to benefit health systems and their patients.