Collecting payments from all payers and ensuring patients have a positive experience — financially and overall — has often been a struggle for healthcare providers. The general theme of payment friction and mitigation strategies are big discussion points in my most recent book, Healthcare Evolution: Helping Providers Get Paid in an Era of Uncertainty. In a previous article, I outlined pain points patients encounter as part of their healthcare journey. Here, I’d like to delve into what challenges providers face, as well as ways they can make improvements to drive yield and execute a frictionless revenue cycle.
Friction with payers: The relationship between payers and providers continues to be contentious, and for the most part it stems from payment responsibility.1 Ensuring authorizations and medical necessity requirements and workflows are in place can often involve multiple touches, and getting it right is imperative to reducing denials and recovering revenue. When rules change and financial clearance processes are not in sync, providers are left with the bill. On top of all this, insurance can be disruptive to the patient-physician relationship. Physicians want to care for their patients, not talk about coverage, cost and payments.
Friction also comes from the vast amount of disparate data that exists in healthcare. There’s no shortage of information — from clinical, claims and third-party data sources — and being able to distill it to actionable positive change is a challenge. Collaboration is lacking, especially when it comes to privacy, interoperability and socioeconomic data. If the industry chooses to work together, we’ll be able to better improve care and reduce costs.
Best practice tip: The best way to enhance the provider and payer relationship is to work as a more unified team. For providers, this means having regular conversations with your payers, having shared goals and staying updated on contractual changes. Having an automated solution in place to manage denials and underpayments, and track authorizations and medical necessity can help enhance operational efficiencies as well.
Friction with the purchasers of care (patient, consumer, employer and government): The payment system within the healthcare industry is antiquated at best, involving paper bills, faxes, multiple statements and telephones. A frictionless payment system for patients — one that automates payments, provides accurate estimates, offers financing plans and determines financial aid — can help free up staff time to focus on accounts that matter most, and empowers patients to pay on their own terms and ability. Putting patients in control of their costs — and their payments schedule to meet that burden — represents a key strategy to positive payment outcomes for patients. This streamlined approach to the patient financial experience benefits all involved. Patients feel more in control and educated about the costs of care, and providers are able to collect more efficiently. In an era where price transparency and affordability are top of mind, it’s worthwhile to put a smart, end-to-end engagement process in place. Another challenge is related to the episodic delivery of care. While this has improved somewhat over the years, an overutilization of emergency rooms and other levels of care drives up costs.2 Patients often choose the wrong (and more costly) location for care delivery, and advanced datasets can help alleviate these issues. It’s worth noting in the current COVID-19 environment, emergency room visits are down —now by 25% compared to pre-COVID-19 volumes.
Best practice tip: If your organization isn’t doing it already, consider investing in a patient engagement solution and exploring third-party risk attributes. Both of these efforts will help better meet your patients where they’re at — financially and overall.