The critical ‘money conversation’ providers should have with patients

The influx of newly insured patients as a result of the Affordable Care Act coupled with the overwhelming adoption of high deductible health plans has left patients reeling from the sticker shock of their out-of-pocket costs. As a result, patients are becoming informed consumers. They know there’s a financial component to their medical care, and they’d prefer to have the money conversation sooner rather than later. The catch is, most consumers aren’t prepared to pay their medical bill in full.

In fact, 79% of consumers participating in the 2018 Healthcare Consumerism study by ClearBalance and Porter Research said they will ask their healthcare providers about payment options to help them cover their cost of care. According to one study respondent, “Any hospital bill is expensive. We expect the hospital to have a way for the patient to make payments.”

Healthcare organizations including North Memorial Health in Minnesota and VCU Health in Virginia understand this and coach their financial counselors to work closely with patients on financing options. Most importantly, the culture at both organizations has changed with the rising tide of consumerism.

North Memorial Health’s patient experience commitment

North Memorial Health is a small fish in a big pond, competing against much larger health systems in Minnesota. A comprehensive clinical-financial experience fits with the organization’s mission and cultural commitment to customer service. As a result, instead of waiting for patients to introduce payment plan conversations, North Memorial Health leaders made a conscious decision to approach consumers first, ideally before services take place, to talk about payment arrangements.

As the North Memorial Health revenue cycle team reformulated its strategy, leaders knew that consumers were changing their habits. Instead of following physicians to specific hospitals, consumers are considering other variables. For example, they’re shopping for prices that match their care experiences. The North Memorial Health team recognized they had to improve estimation processes and be proactive to discuss and arrange payment options. The key has been to balance consumer convenience with A/R goals.

As a result, the revenue cycle team has invested heavily in training financial counselors and worked closely with the marketing department to ensure its financial policies, payment options and payment methods are communicated consistently across all points of patient engagement —preservice to post-service. North Memorial Health posts payment option information on its website and social channels; on posters, registration counters and kiosks at the point of service; and on patient materials and billing statements.

Comprehensive communication at all patient-engagement points has generated more questions during the registration process, resulting in more informed consumers. The hand-off to the business office has been smooth, with positive results, including an almost non-existent default rate for patient financing. In addition, North Memorial Health set long-term payment plans to a limit of three years rather than 10 years or longer. Outsourcing patient financing also enabled North Memorial Health to get lingering A/R off its books.

North Memorial Health also accounts for the nuances of its patient pay demographic. For example, an increase in the number of self-pay patients has been challenging, with special attention paid to ensure adherence to 501(r) and Minnesota state regulations. Team members work to ensure financial coverage as they schedule appointments, if medically possible. Patients are satisfied with the process because they understand North Memorial Health counselors are serving their best interests for financial peace of mind.

Continuous improvement

The team is continually thinking about how to help customers in other ways, such as more convenient payment methods. Fewer patients are sending checks by mail. North Memorial Health planned for, and is seeing, more patients pay out-of-pocket costs via the web and on smartphones. The belief is that if a patient is willing to pay, North Memorial Health will make it convenient.

VCU Health on balancing its approach

At VCU Health in Richmond, Va., what was once a strict conversation about payment in full has evolved to a discussion of payment options. The introduction of multiple payment paths, including zero-interest financing, has empowered VCU Health financial counselors to proactively discuss patients’ out-of-pocket costs.

See related sidebar: 6 tips for financial counselors

VCU Health’s financial team also found training to be a critical component of its revamped financial services process. The customer service team now is more confident about patient financial conversations, and there is consistency across the team in messaging and processes. VCU Health eliminated the wide disparity in payment arrangements offered to various patients. Prior scenarios of the patient “guilting” the counselor into setting up a $10 monthly payment structure over 10, 15 and even 20 years no longer occurs. Instead, all financial counselors follow the same script and financial parameters to support the organization’s financial guidelines. The health system ensures that its early out partner also adheres to these guidelines.

Benefits-focused conversations

VCU Health also uses its financing options as a marketing asset to attract consumers who are shopping for care with cost in mind. The team answers questions and engages consumers and incoming patients in a way that differentiates the health system from its competitors. Counselors let consumers know about the financial arrangements the health system offers, including two important patient satisfiers:

• Patients can combine payments for hospital and physician services rather than making two separate payments, relieving patients of the burden of keeping track of multiple bills.
• VCU Health counselors also highlight the fact that patients have the ability to add costs for future healthcare services and consolidate costs for their dependents into one payment plan with one monthly statement.

Most healthcare visits are unexpected, and many consumers don’t have savings to cover expensive healthcare bills. VCU Health’s team is finding the balance of consumer-friendly payment options while maintaining strong business performance by re-educating the community that payment for care is expected, but it can be handled in an affordable manner. It’s just a matter of having the money conversation.