Northwestern Medicine, an academic medical center serving the Chicago area, created and implemented a two-part improvement pilot in 2018. The pilot included discussing patients’ insurance benefits prior to the beginning of treatment in one intervention. It also included reaching out to patients who had outstanding balances to discuss the barriers to payment they were facing in the second intervention. In both interventions, patients were educated about common insurance terms, such as deductible and co-payment.
Approach
As a first step, the team reviewed bad debt trends and identified the highest opportunity areas. Oncology was identified as the third highest contributor to bad debt and the service line that had the greatest potential for improvement because the services with the highest cost are generally planned in advance.
In baseline cases within oncology from September 2017 through February 2018, the team found that 50% of the bad debt came from just 2% of patients who had balances over $10,000.
The team then performed retrospective chart review on 20 patients with the highest amount of bad debt to identify root causes and risk factors for accounts falling to bad debt. The variables explored were age, gender, treatment course, insurance type and network status. It was determined that the majority of the cost was from chemotherapy, and most of the patients were insured. Based on that analysis, the financial counseling and billing services interventions were developed.
Pilot design
The pilot, which included these two distinct interventions, was conducted between May and August 2018. Results are shown in the exhibit.
- Billing specialist pilot. For individuals with outstanding balances, a billing specialist contacted the patient to discuss barriers to payment. Patients were offered assistance such as drug replacement and co-pay assistance programs, financial assistance and payment plans. Billing specialists also provided education regarding common terms such as deductible, copayment, coinsurance, deposit, estimate, out-of-network and out-of-pocket maximum.
- Financial counseling pilot. In a parallel pilot, a proactive financial counseling intervention was conducted for all patients starting a new regimen of intravenous chemotherapy at one of Northwestern Medicine’s infusion centers. Financial counselors provided education regarding each patient’s insurance benefits as well as term definitions as provided in the other pilot. And those patients with a risk factor for bad debt (e.g., out of network, no prescription drug coverage) received more direct counseling to address their identified need.
Table 1: Characteristics of patients in the billing and financial counseling intervention | ||
Characteristic | Billing intervention (n= 255) | Financial counseling intervention (n=277) |
| Male Female | 84 males (33%) 171 females (67%) | 125 males (45%) 152 females (55%) |
| Mean Age | 54 | 57 |
Malignancy type | ||
| Anemia/blood disorder | 17 (7%) | 18 (7%) |
| Brain | 8 (3%) | 15 (5%) |
| Breast | 65 (25%) | 21 (8%) |
| Colorectal | 21 (8%) | 29 (10%) |
| Genitourinary | 9 (4%) | 15 (5%) |
| Gynecologic | 27 (11%) | 16 (6%) |
| Head and Neck | 10 (4%) | 10 (4%) |
| Leukemia | 14 (5%) | 17 (6%) |
| Lung cancer | 11 (4%) | 21 (8%) |
| Lymphoma | 16 (6%) | 21 (8%) |
| Melanoma/other skin | 7 (3%) | 12 (4%) |
| Multiple myeloma | 24 (9%) | 35 (13%) |
| Other GI malignancy | 7 (3%) | 20 (7%) |
| Sarcoma | 5 (2%) | 11 (4%) |
| Unknown/other | 14 (5%) | 16 (6%) |
Insurance type | ||
| Private | 150 (59%) | 137 (41%) |
| Medicaid only | 47 (18%) | 47 (17%) |
| Medicaid with supplement | 15 (6%) | 18 (6%) |
| Medicare only | 15 (6%) | 15 (5%) |
| Medicare with supplement | 17 (7%) | 49 (18%) |
| Veterans’ Health | 3 (1%) | 3 (1%) |
| Other | 8 | 9 (3%) |
| Source: Northwestern Medicine |
Results
From May 1, 2018, until August 31, 2018, 532 unique patients were counseled at two separate infusion centers at Northwestern Medicine’s Robert H. Lurie Comprehensive Cancer Center.
The outcomes of each counseling discussion are summarized in the exhibit on page page 24. In both interventions, the top three topics patients discussed or had questions about were related to:
- A specific bill
- The patient’s account balance
- Bills not submitted to insurance
In the billing intervention, the outcome was that 50% had a billing error corrected. Of those patients in the financial counseling intervention, 67% were referred to billing because they had a question/issue specifically involving billing.
In the baseline period from September 2017 through February 2018, $560,648 (monthly average $93,441) in high-dollar balances were placed with bad debt vendors. During the intervention pilots’ time frames, $130,678 (monthly average $32,669) in high-dollar balances were placed with bad debt vendors. Therefore, there was a 65% reduction in monthly average bad debt placement in accounts greater than $10,000 from the baseline period to intervention period.
Outcome of billing and financial counseling intervention | ||
Billing specialists intervention |
Total with outcome |
Percent with outcome |
| Billing error corrected/ billed insurance/looking into insurance or verify insurance | 127 | 50 |
| Statement reviewed with patient/answered questions | 76 | 30 |
| Provided insurance with more information | 17 | 7 |
| Deposit collected | 3 | 1 |
| Financial assistance application taken or approved | 2 |
Discussion
These two parallel pilots demonstrate that it is feasible to implement routine financial counseling at a large academic institution with either a billing specialist or financial counselor. In both interventions, most of the questions and concerns of patients were related to either a specific bill, an error in billing, details of insurance coverage or their account balance. This information highlights the complexity of insurance billing.
The fact that 50% of those in the billing intervention had an error corrected highlights that at least a portion of bad debt could be avoided or mitigated with a process for careful review of bad debt billing.
Although this approach might not be feasible in a smaller facility, the Northwestern pilots show that intervention could have a positive influence on efforts to reduce bad debt. The team continues to look for ways to better understand patient and provider perspectives on this type of financial counseling intervention.
The author would like to thank the following people for their contributions to this article:
Cassandra Davis, Manager Operations, Northwestern Medicine
Noam Davidoff, Program Director, Operations, Northwestern Medicine
Samantha Albergo, Manager, SBO Patient Accounting, Northwestern Medicine
Tawana (Angel) Covington, Operations Coordinator, SBO Patient, Northwestern Medicine
Stephanie Martin, Manager Financial Counseling, Northwestern Medicine
Connie Augustyniak, Practice Manager, Northwestern Medicine
Bijal Desai, Program Manager, Value-based Care, Northwestern Medicine
Ariana Economos, Patient Access Coordinator, Northwestern Medicine
Robin Katz, Social Worker, Northwestern Medicine
Sandra Manley-Eichler, Social Worker, Northwestern Medicine
Jessica Walradt, Manager, Value-based Care, Northwestern Medicine
Mary Mulcahy MD, Professor, Northwestern Medicine
Al B. Benson, MD, Professor, Northwestern Medicine
Hannah Alphs Jackson, Director, Value-based Care, Northwestern Medicine
