Although the Affordable Care Act (ACA) has extended insurance coverage to millions of Americans, it has actually created an underinsured population. We’re seeing a real shift from fee-for-service to a much higher percentage of self-pay patients in high-deductible plans who may not understand their financial obligations for healthcare.
Only five years ago, the average deductible in such a plan was $1,500. Now, it’s common for it to be $5,000 for an individual or $10,000 for a family. In addition, insurance copayments are growing. There’s been a change in what is reimbursed from health plans to employers, and now to patients. We are now seeing that 10-20% of some services are a patient’s responsibility after they meet the deductible.
Those two factors – high deductibles and higher copayments – are really affecting an underinsured population.
When you consider that the average family income is $52,000 per year and the average family deductible is $10,000, any type of healthcare event – a surgery or emergency department visit, for example – can quickly put the family under water financially. That’s why we continue to see healthcare as the number one reason for personal bankruptcy. And those bankruptcies are growing.
As a result of these changes, hospitals and physician practices increasingly identify charity care for these patients and manage collections from insurance companies. Most importantly, they are shifting their business model to collect up-front patients’ self-pay money paid out of pocket. The way providers interact with patients has gone through a complete revolution.
The fact is that if organizations collect one dollar at the point of service, they are eight times more likely to collect the entire patient responsibility compared to waiting until the back-end for collections. Given that, it’s important to look for a business partner who understands the patient as a consumer and her or his propensity to pay. TransUnion’s data sets make us one of the largest eligibility clearinghouses for patient estimation tools to educate patients and drive collection of real dollars at point-of-service.
TransUnion Healthcare is a division of TransUnion, a global information solutions company that serves both businesses and consumers in 33 countries. Since its inception 12 years ago, TransUnion Healthcare has focused primarily on revenue cycle management and on maximizing reimbursement and cash flow in healthcare organizations.
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