Many of the questions we frequently hear revolve around industry trends contributing to higher bad debt and what to do about them. So, how can health providers address the challenge of improving collections and reducing bad debt?
Readily available data-driven solutions can help in a number of ways. First, on the front-end, providers can collect more through automated patient access solutions that identify and verify insurance eligibility of patients who come in the door.
Second, providers can help patients understand their out-of-pocket costs up-front by giving them estimates specific to payers and plans associated with patients.
Third, providers can offer patients a recommended payment plan. For example, TransUnion is also a credit bureau, which helps us evaluate the propensity for a patient to pay. If we determine a patient cannot pay based on information they share, we can automatically search for charity care. We can also communicate with insurers to see that prior authorization and medical necessity are established to help with appropriate reimbursement.
Fourth, providers can reduce bad debt on the back end. In most hospitals and physician practices, about 5% of uncompensated care patients have some level of insurance coverage that could have been reimbursed. This problem is growing alongside enrollment in the ACA’s health exchanges due to system issues that may not identify insurance due to subtle changes in subscriber names or to subscribers who don’t adequately understand their insurance coverage.
For example, to help providers reduce bad debt on the back end, our coverage discovery product, eScan, can identify insurance for patient populations that providers can’t find. Armed with that information, our customers can then return those dollars back to their organizations. Hospitals typically run on thin margins, and eScan can make a real difference to financial health. In one instance, a health system was able to recognize $21 million in charges. They credited TransUnion with putting them back in the black. In fact, by December 2015, through our customers’ use of eScan, more than $1 billion will have been returned to hospitals and physician practices.
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