Why it’s imperative for healthcare organizations to review their financial assistance programs during the COVID-19 pandemic

• Many Americans find themselves without employer-sponsored insurance for the first time and don’t have any idea about COBRA, the healthcare coverage marketplace and myriad other health insurance issues.
• The ambiguity makes it more important than ever for healthcare organizations to review their financial assistance program, according to revenue cycle management services executives interviewed for this article.
• Healthcare providers should consider going back and reviewing the final disposition of balances for patients who did not qualify for charity care.

Ann, 19, a part-time restaurant hostess, lost her job at the onset of COVID-19, making it impossible for her to pay rent. She is also avoiding calls from the billing staff at the hospital where she was treated for severe burns and received follow-up care.

Ann, a fictitious healthcare consumer, represents some of the millions of Americans who have been furloughed or lost their jobs during the pandemic. According to U.S. Department of Labor figures released July 23, more than 52 million initial jobless claims have been filed by workers since layoffs spiked in mid-March.

Many Americans find themselves without employer-sponsored insurance for the first time and don’t have any idea about COBRA, the healthcare coverage marketplace and myriad other health insurance issues.

Speaking during HFMA’s Responsive Revenue Cycle Management virtual conference earlier this year, Nicole Nye, director of product management with Waystar, proposed several charity coverage strategies for responding to the waves of uninsured patients who have been flooding the healthcare system since the onset of COVID-19.

“For people living in poverty, some don’t have a credit history, and as in the case of Ann, [they] don’t engage in the financial screening process for a variety of reasons,” Nye said during her session, “Consumer-Centric Strategies for an Increasing Self-Pay Population” (available as an on-demand webinar).

Reasons why healthcare consumers do not engage in financial discussions include language barriers and lack of understanding of available resources, according to Nye.

And many of the newly uninsured are grappling with applying for COBRA, getting insurance on the exchanges or wondering whether they now qualify for financial assistance, Nye said.

Supporting the newly uninsured

The ambiguity makes it more important than ever for healthcare organizations to review their financial assistance program, according to revenue cycle management services executives interviewed for this article.

Kelley Blair, senior vice president at Change Healthcare, says a review of an organization’s financial assistance process is in order for a couple of reasons: First because of [HHS] dollars that are available to cover services provided to uninsured COVID-19 patients, and second because of the millions of people who are unemployed.

Organizations should strive “to understand — and this is going to vary by region — the volume of patients and the support that’s going to be needed from a financial counseling perspective upfront … to see if there’s other coverage that they can get,” Blair said. “And then also making sure that there’s the [staffing] resources to go through and help to process the charity care.”

Blair said healthcare organizations could see whether uninsured patients qualify for Medicaid first, then apply for the [HHS] funding allocated for providers that treat uninsured patients, which she noted is limited and on a first-come, first-served basis.

“And then, of course, if you don’t get the funds from a CMS perspective, then being able to go and look at those patients for charity care,” Blair said.

Adjusting financial assistance programs

The task of reviewing financial assistance policies, likely is going to vary based on region and where the hospital is in its journey, according to Blair.

“You’re going to have a larger number of unemployed individuals who are not going to qualify for Medicaid or for other coverages, so how do you look at your process and make sure that it is accounting for those patients?”

Hospitals should consider whether unemployment trends in the market create a need for adjustments to income requirements, according to Blair. A key question to ask, she said, is whether the metric refers to annualized income.

“Some charity care policies will look at what the patient’s annual income is, and people could be producing income for the first couple months of this year,” Blair said. “But if they’re unemployed [now], making sure that we’ll take that into account.”

Making adjustments to processes to assist patients

Clients of Parallon also have been reviewing their financial assistance programs, according to Shannon Dauchot, CEO of Parallon’s Revenue Cycle Point Solutions Division.

“Most of the hospitals and health systems we serve are making adjustments to their processes to provide greater assistance to patients requiring financial assistance,” Dauchot said.

“This includes actions such as more leniency with payment plan terms and increased availability of financial counseling services.”

HCA Healthcare, Parallon’s parent company, “had several patient-centric policies already implemented to assist the uninsured and underinsured, including an uninsured discount, expanded charity policy and a patient liability protection policy that protects patients from catastrophic balances and surprise bills,” Dauchot said.

In response to the unprecedented levels of unemployment due to the pandemic, HCA Healthcare brought together leaders from many areas of the organization to determine how best to serve its communities and all who have been impacted economically, according to Dauchot.

Among the many efforts are:

• Implementation of the free Patient Benefit Adviser hotline to interact directly with consumers whose insurance coverage has been impacted and who may need assistance finding coverage
• Engagement with payers and employers to determine opportunities to assist the newly uninsured
• Development of partnerships with national and community not-for-profit organizations seeking to assist patients with premiums

A barometer for charity care program effectiveness

Healthcare providers should consider going back and reviewing the final disposition of balances for patients who did not qualify for charity care.

“It’s a barometer around how effective your program is,” Blair said.

If a majority of the patients who were denied charity care end up in bad debt because they can’t pay their bill, further review should be conducted to determine whether the charity care policy should be modified or whether a new approach to collections may be needed, according to Blair.