Hospitals struggle with the dilemma of patients hit by high deductibles
Skip to main content
MDHC_Logotype_white
Subscribe
  • My Account
  • Login
  • Subscribe
  • News
    • This Week's News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • People
    • Regional News
    • Digital Edition
    • Healthcare construction primed to rebound faster than other sectors
      Drug executives: Big jump in vaccine supply is coming soon
      States rush to catch up on delayed vaccines, expand access
      Becerra supports access to care, provider funding during confirmation hearing
    • Drug executives: Big jump in vaccine supply is coming soon
      States rush to catch up on delayed vaccines, expand access
      White House promises vaccine help as states rush to catch up
      Michigan health aides to lose $2 raise without legislation
    • Dr. Imran Andrabi
      Q&A: ThedaCare CEO says lessons from COVID-19 will inform new approaches to population health management
      The Check Up: Dr. Imran Andrabi
      The Check Up: Dr. Imran Andrabi of ThedaCare
      Hospitals confront water shortages in winter storm aftermath
      beaumont-hospital-royal-oak_i_i_i.jpg
      Beaumont says nearly 2,000 second-shot vaccinations canceled due to vaccine shortage
    • Beyond the Byline: Insurers are betting on virtual-first plans as COVID-19 shifts care pathways
      Beyond the Byline: Insurers are betting on virtual-first plans as COVID-19 shifts care pathways - Transcript
      Health insurance execs' salaries grew faster than company revenue in 2020
      Five chronic conditions cost employers $2.5 billion over two years, study shows
    • States rush to catch up on delayed vaccines, expand access
      Becerra supports access to care, provider funding during confirmation hearing
      White House promises vaccine help as states rush to catch up
      Biden asks high court to drop two Trump-era Medicaid cases
    • deloitte GDP image chart graph going up
      Sponsored Content Provided By Deloitte
      Breaking the cost curve
      By the Numbers: Largest taxable not-for-profit bond issuances, 2021
      Dennis Dahlen
      Health systems aren't rushing to cut back on financial liquidity
      Modern Healthcare CEO Power Panel
      Providers focus on adding nurses, expanding outpatient care
    • man and woman looking at ipad wearing face masks stock image
      Sponsored Content Provided By Surescripts
      Improvements to benefits data can enhance ePrescribing and the patient experience
      Oscar Health's $1B IPO sets the stage for more health tech exits in 2021
      A map of the U.S. with images of the coronavirus.
      The digital divide becomes a new social determinant of health
      Google opens Rochester, Minn., office to be closer to Mayo Clinic
    • angela karpf headshot
      Sponsored Content Provided By B. Braun
      Making patient safety a policy priority
      Michigan Maze Woman-main_i.jpg
      State of confusion: Michigan's mental health system has many layers for those in need to navigate
      Next Up Podcast: Educating patients on the COVID-19 vaccine with Tanya Andreadis
      Next Up Podcast: Educating patients on the COVID-19 vaccine with Tanya Andreadis - Transcript
    • Michael Jordan, Novant team up to address health equity
      Former Ascension CEO, the first to lead the health system, passes away
      Biden's pick to head CMS would be first Black woman to hold post
      RAKESH SURI MD_i.jpg
      Cleveland Clinic creates president of international operations position
    • Midwest
    • Northeast
    • South
    • West
  • Insights
    • ACA 10 Years After
    • Best Practices
    • Special Reports
    • Innovations
    • The Affordable Care Act after 10 years
    • Dr. John Fischer
      Patient-reported outcomes tool for hernia surgery helps physicians improve care
      New care model helps primary-care practices treat obesity
      doctor with patient
      COVID-19 treatment protocol developed in the field helps patients recover
      Rachel Wyatt
      Project to curb pressure injuries in hospitals shows promise
    • What's next for on-demand telehealth companies?
      A CalOptima PACE vaccination clinic.
      Will COVID-19 be the catalyst for creating a more sustainable healthcare system?
      A map of the U.S. with images of the coronavirus.
      The digital divide becomes a new social determinant of health
      Ascension’s St. Mary’s Hospital Surgery Center at Towne Centre and Allegheny Health Network’s Bethel Park surgery center
      Hospitals see opportunity, risk in ambulatory surgery centers
    • Dr. Daniel Hall
      UPMC pilots machine learning, telehealth to inform patient transfers
      A woman being recorded using her inhaler on a smartphone.
      Digital check-ins, connected inhalers help control asthma
      A phone screen showing the question, "Mary we hope this information was helpful and we'd like to keep guiding you. Are you interested in knowing when it's your turn to receive the vaccine?"
      Chatbots, texting campaigns help manage influx of COVID vax questions
      A woman with a wearable sensor talking to her provider.
      Wearable sensors help diagnose heart rhythm problems in West Virginia
  • Transformation
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • What's next for on-demand telehealth companies?
      Rising prescription copays drop adherence, spike mortality, research shows
      Dr. John Fischer
      Patient-reported outcomes tool for hernia surgery helps physicians improve care
      Highmark Health inks six-year cloud, tech deal with Google
    • California hospitals prepare ethical protocol to prioritize lifesaving care
      Amazon, JPMorgan Chase, Berkshire Hathaway disband Haven
      Digital pathways poised to reshape healthcare continuum in 2021
      Healthcare was the hardest hit by supply shortages across all U.S. industries
    • Dr. Daniel Hall
      UPMC pilots machine learning, telehealth to inform patient transfers
      A woman being recorded using her inhaler on a smartphone.
      Digital check-ins, connected inhalers help control asthma
      Humana partners with in-home provider for 24/7 care
      A phone screen showing the question, "Mary we hope this information was helpful and we'd like to keep guiding you. Are you interested in knowing when it's your turn to receive the vaccine?"
      Chatbots, texting campaigns help manage influx of COVID vax questions
    • Coordinated payment policies could speed transition to value, experts say
      CMMI's geographic direct contracting model needs an overhaul, experts say
      Hospitals fight UnitedHealthcare policies over lab test, specialty drug payments
      Cigna eliminates prior authorization for coronary CT scans
  • Data/Lists
    • Rankings/Lists
    • Interactive Databases
    • Data Points
    • Health Systems Financials
      Executive Compensation
      Physician Compensation
  • Op-Ed
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
    • Dr. Alan Kaplan
      The risks, rewards of taking organizations 'where they haven’t gone before'
      Wellstar CEO calls adapting for the pandemic her bold move
      Howard P. Kern
      Recognizing the value of telehealth in its infancy
      Dr. Stephen Markovich
      A bold move helped take him from family doctor to OhioHealth CEO
    • Dr. Stephen Markovich
      Making sure we're aligned along the path to achieving inclusion
      Barry Ostrowsky
      Ending racism is a journey taken together; the starting point must be now
      Laura Lee Hall and Gary Puckrein
      Increased flu vaccination has never been more important for communities of color
      John Daniels Jr.
      Health equity: Making the journey from buzzword to reality
    • In-person visitation must be part of the national COVID-19 response
      We've lost so much to the pandemic, but we've also made gains that will endure
      Medical groups key to meeting president's vaccine pledge
      We need a better social care referral loop, but it requires technology as well as the human touch
    • Letters: Eliminating bias in healthcare needs to be ‘deliberate and organic’
      Letters: Maybe dropping out of ACOs is a good thing for patients
      Letters: White House and Congress share blame for lack of national COVID strategy
      Letters: VA making strides to improve state veterans home inspections
    • Sponsored Content Provided By Optum
      How blockchain could ease frustration with the payment process
      Sponsored Content Provided By Optum
      Three steps to better data-sharing for payer and provider CIOs
      Sponsored Content Provided By Optum
      Reduce total cost of care: 6 reasons why providers and payers should tackle the challenge together
      Sponsored Content Provided By Optum
      Why CIOs went from back-office operators to mission-critical innovators
  • Awards
    • Award Programs
    • Nominate
    • Previous Award Programs
    • Other Award Programs
    • Best Places to Work in Healthcare Logo for Navigation
      Nominations Open - Best Places to Work in Healthcare
      Nominations Open - 50 Most Influential Clinical Executives
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Minorities in Healthcare
      • - Luminaries
      • - Top 25 Minority Leaders
      • - Minorities to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Excellence in Nursing Awards
    • Design Awards
    • Top 25 COOs in Healthcare
    • 100 Top Hospitals
    • ACHE Awards
  • Events
    • Conferences
    • Galas
    • Webinars
    • COVID-19 Event Tracker
    • podium march webinar logo lockup
      Sponsored Content Provided By Podium
      Webinar: Critical Touchpoints for Every Patient’s Journey — How Technology Plays an Important Role
      scp health logo lockup march 2021
      Sponsored Content Provided By SCP Health
      Webinar: COVID’s call to action — Reset for success in 2021
    • Women Leaders in Healthcare Conference
    • Social Determinants of Health Symposium
    • Healthcare Transformation Summit
    • Leadership Symposium
    • Virtual Briefings
      • - Hospital of the Future
      • - Mental Health
      • - Patient Safety & Quality
      • - Strategic Marketing
      • - Virtual Health
      • - Workplace of the Future
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Minority Leaders Gala
    • Top 25 Women Leaders Gala
  • Listen
    • Podcast - Next Up
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
    • Next Up Podcast: Educating patients on the COVID-19 vaccine with Tanya Andreadis
      Dr. Joseph Cacchione
      Next Up Podcast: Educating patients on the COVID-19 vaccine with Dr. Joseph Cacchione
      Dr. Karen DeSalvo
      Next Up Podcast: What to expect with telehealth and healthcare technology in the next four years
      Carter Dredge
      Next Up Podcast: Ready, set, innovate! Innovation and disruption in healthcare
    • Beyond the Byline: Insurers are betting on virtual-first plans as COVID-19 shifts care pathways
      Beyond the Byline: How residents' stories shape our coverage of the vaccination rollout in nursing homes
      Beyond the Byline: Regulators aim to boost value push with fraud and abuse law updates
      An older man wearing a mask receiving a vaccine.
      Beyond the Byline: Verifying information on the chaotic COVID-19 vaccine rollout
    • Outreach during COVID-19
      Leading intention promote diversity and inclusion
      Introducing Healthcare Insider Podcast
    • The Check Up: Dr. Imran Andrabi
      The Check Up: Dr. Imran Andrabi of ThedaCare
      The Check Up: Tanya Blackmon
      The Check Up: Tanya Blackmon of Novant Health
      The Check Up: Dr. Patrick Hwu
      The Check Up: Dr. Patrick Hwu of the Moffitt Cancer Center
      The Check Up: Suresh Gunasekaran
      The Check Up: Suresh Gunasekaran of the University of Iowa Hospitals & Clinics
    • ivana naeymi-rad one on one intelligent medical objects
      Video: Ivana Naeymi Rad of Intelligent Medical Objects
  • MORE +
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Providers
June 28, 2017 01:00 AM

Hospitals struggle with the dilemma of patients hit by high deductibles

Dave Barkholz
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    "We win all kinds of awards for patient quality, but our revenue cycle didn't match that performance." Deborah Vancleave Vice president of revenue cycle Mosaic LIfe Care

    Story updated July 7, 2017.

    ORLANDO, Fla.—The rise of high-deductible health plans is driving one Missouri hospital to completely revamp patient registration, billing and collection.

    Mosaic Life Care, a 297-bed hospital in the town of St. Joseph north of Kansas City, is a perennial on Truven Health Analytics' annual 100 Top Hospitals list, which recognizes facilities for patient care, operational efficiency and financial stability.

    Yet last year, $23 million worth of self-pay patient care exposed deep flaws in the processes and technology the hospital used to log patient information, make insurance claims and approach patients for out-of-pocket costs, said Deborah Vancleave, Mosaic's vice president of revenue cycle.

    "We win all kinds of awards for patient quality, but our revenue cycle didn't match that performance," said Vancleave, who spoke on the sidelines of the annual national conference held last month by the Healthcare Financial Management Association.

    In the past five years, health insurers went from paying 90% of patient-care costs to only about 70%, and that's causing massive headaches for providers.

    THE TAKEAWAY

    Losses from self-pay patients have hospitals scrambling to better manage patient registration and bill collections.

    Vancleave said the stark reality of high-deductible healthcare—though on the radar of Mosaic executives last year—really hit home during the first four months of this year.

    The hospital, she said, stayed nearly full during that time, posting record census and gross revenue. But net revenue didn't budge an inch from the prior year period because patients weren't paying their growing share of the cost of care.

    Patients' self-pay total—the amount not covered by insurance—was up 9% over the four months, she said.

    That's put Vancleave on a quest for improvement.

    Just a month ago, Mosaic brought in ClearBalance to offer patients financing options for their out-of-pocket costs.

    ClearBalance and other healthcare financing companies such as HealthFirst Financial arrange loans with patients that hospitals typically customize. Often they include a no-interest option for 12 to 24 months but as long as 72 months depending on what hospitals require.

    ClearBalance, which has been making patient loans since 1992, has 150,000 patients on credit at any one time at scores of hospitals, CEO Bruce Haupt said.

    HealthFirst, whose customers include Trinity Health, has $71 million in patient loans at any one time at about 220 hospitals, physician offices and ambulatory surgery centers, said KaLynn Gates, the company's president.

    Vancleave said Mosaic enlisted ClearBalance to recover more of the out-of-pocket costs owed by patients and offer them a financing option.

    Vancleave, who joined Mosaic a year ago after years at revenue-cycle giant Conifer Health Solutions, said the small-town hospital had tried a previous payment plan for patients. But it could only collect 20% to 30% of what patients owed. That was because of the hassle of sending out monthly bills and the difficulty of employees trying to collect from their neighbors.

    Since outsourcing the job to ClearBalance, the hospital has already received a seven-figure check from ClearBalance for outstanding out-of-pocket bills, Vancleave said.

    Both ClearBalance and HealthFirst are "recourse" lenders, which means they pay the hospital upfront for the outstanding bills of patients who sign up for a loan.

    But the hospital guarantees the money and repays the lender if patients default on their credit lines. The finance companies make their profit by getting a 10% to 15% fee for the outstanding amount of the loan.

    Vancleave said the fee is worth the much higher rate of recovery that the hospital has gotten on out-of-pocket receivables.

    In the past five years, health insurers went from paying 90% of patient-care costs to only about 70%, and that's causing massive headaches for providers.

    Hospital and vendor executives at the HFMA conference said the strains from high-deductible plans are ballooning.

    In​ 2016,​ for​ the​ first​ time, more than half of all workers (51%) with single coverage faced a deductible of at least $1,000, according to a study released last September by the Kaiser Family Foundation/Health Research & Educational Trust.

    The study showed that 29% of workers were in high-deductible plans compared with 20% two years earlier.

    Hospitals are struggling to collect the increased patient share of the cost, according to Crowe Revenue Cycle Analytics, a unit of accounting and consulting giant Crowe Horwath.

    Data derived from about 660 hospitals show overall managed-care net revenue has declined 2.5% for outpatients and 1.4% for inpatients based on unchanged contract rates over the past year. The cause was lower collection rates for "patient responsibility" dollars than for payer responsibility dollars.

    About five years ago, insurers paid about 90% of hospital claims, with patients responsible for about 10%, said Jase DuRard, chief revenue officer for revenue-cycle vendor AccuReg. Today, the mix is 70% by insurers and 30% patient out-of-pocket, he said.

    It's crucial in that environment to provide patients with as much information as possible upfront, before their procedures, said David Muhs, chief financial officer at Henry County Health Center in Mount Pleasant, Iowa.

    The 25-bed critical-access hospital uses RelayHealth revenue-cycle software from Change Healthcare to give patients a solid cost estimate of their out-of-pocket costs, often in a phone call before their care is even delivered, Muhs said.

    That transparency allows them to concentrate on their care or that of a loved one when it's time for treatment rather than hitting them with a big bill afterward, he said.

    Vancleave said Mosaic recently turned to AccuReg tools to button down the accuracy of information the hospital gets at registration and help the hospital determine whether individual patients can afford to pay for care, should be signed up for Medicaid, or should go straight to a charity write-off.

    She said pursuing collection from people who can't pay just causes them unnecessary angst and hurts the hospital's public perception and patient-satisfaction scores.

    Revenue cycle staff "are the first point of contact with a patient and the last point of contact," Vancleave said. "That's important to keep in mind."

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    The Check Up: Dr. Imran Andrabi of ThedaCare
    The Check Up: Dr. Imran Andrabi of ThedaCare
    Q&A: ThedaCare CEO says lessons from COVID-19 will inform new approaches to population health management
    Q&A: ThedaCare CEO says lessons from COVID-19 will inform new approaches to population health management
    Sponsored Content
    Get Free Newsletters

    Sign up for free enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today

    The weekly magazine, websites, research and databases provide a powerful and all-encompassing industry presence. We help you make informed business decisions and lead your organizations to success.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS
    • Instagram

    Stay Connected

    Join the conversation with Modern Healthcare through our social media pages

    MDHC_Logotype_white
    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • This Week's News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition
    • Insights
      • ACA 10 Years After
      • Best Practices
      • Special Reports
      • Innovations
    • Transformation
      • Patients
      • Operations
      • Care Delivery
      • Payment
    • Data/Lists
      • Rankings/Lists
      • Interactive Databases
      • Data Points
    • Op-Ed
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Awards
      • Award Programs
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top 25 Innovators
        • Minorities in Healthcare
          • - Luminaries
          • - Top 25 Minority Leaders
          • - Minorities to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Nominate
      • Previous Award Programs
        • Excellence in Nursing Awards
        • Design Awards
        • Top 25 COOs in Healthcare
      • Other Award Programs
        • 100 Top Hospitals
        • ACHE Awards
    • Events
      • Conferences
        • Women Leaders in Healthcare Conference
        • Social Determinants of Health Symposium
        • Healthcare Transformation Summit
        • Leadership Symposium
        • Virtual Briefings
          • - Hospital of the Future
          • - Mental Health
          • - Patient Safety & Quality
          • - Strategic Marketing
          • - Virtual Health
          • - Workplace of the Future
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Minority Leaders Gala
        • Top 25 Women Leaders Gala
      • Webinars
      • COVID-19 Event Tracker
    • Listen
      • Podcast - Next Up
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • MORE +
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing