How to clearly communicate patients' financial obligations

Imagine receiving this bill at a restaurant:

Service – $8
Eligible – $7
Meal – $42
Food (% of paid) – $193
Equipment – $19
Please pay this amount – $154

To many patients, that’s what their statements look like — numbers that don’t add up and “explanations” that don’t explain anything. When this occurs, patients can’t help but react as consumers. Not only do they become frustrated — they also wonder whether the goal is for them not to understand how their financial obligation was calculated, so they can’t question the charges or make sure they’re all correct.

The impact of this dynamic doesn’t end with the confusion and distrust it creates. Difficult-to-understand statements result in delayed payments, accidental underpayments, or even non-payments — all due to poor communication. Billing costs go up with every follow-up statement sent, as accounts receivable days and bad debt increase.

Fortunately, you can take some straightforward steps to transform your patient financial communications — and accelerate the pace of your patient collections in the era of growing patient financial responsibility.

Set expectations at the time of service
The absolute best way to reduce patients’ questions about the statements they receive is to reduce the number of statements you have to send — by requesting and accepting payment at the time of service. Find a reliable system for checking eligibility and accurately estimating total patient financial obligation, and review the estimate with patients prior to their appointment or when they check in. When patients know they can trust the estimates you provide, they’ll likely be willing to pay all or some of what they owe at the point of care.

Even if a patient isn’t able to pay in full, reviewing the estimate creates the opportunity to accept partial payment and set up a payment plan with automatic withdrawals. And the truth is, many patients appreciate knowing their obligation up front; when they know what to expect, they can plan and budget accordingly.

Ideally, staff should be ready to provide a printout of the estimate for patients to take home. Patients can refer to the printout later — when they receive their statement — reducing the risk that they’ll forget the estimate and feel there’s been a mistake.

Assess your current statements
Look at your current patient statements with these questions in mind:

  • Is the amount owed displayed prominently and broken out separately from other figures such as past balances or individual charges?
  • Does your practice management system allow you to add plain-English explanations or translations of codes and jargon — and if so, do these appear on your statements?
  • Are the instructions for making payment clear and easy to follow? Are the accepted forms of payment prominently displayed?
  • Does your statement make good use of simple visual clues such as color, font size and spacing to direct the reader’s eye to actionable information?

Depending on the answers to these questions, you may need to start looking for a vendor that can help you revamp your patient financial communications. In addition to overall cost, look at the templates that the vendor provides and make sure they’re an improvement over your current statements.

Electronic statements and payments
Many patients prefer to receive e-statements and pay their bills online — and on average, switching from paper to electronic statements and payments typically cuts the mean days to payment from 20 to 9, while boosting the percentage of full payments rendered from 77 percent to 95 percent, according to research conducted by ZirMed.

Why do e-statements help accelerate patient collections? Among other reasons, patients can access e-statements anytime, anywhere — in the car waiting to pick their kids up from swim practice … at their desk during a lunch break at work … from their home office during a conference call that seems unlikely to either end or actually involve them.

They may not have their paper statement with them at those moments — but they do have a minute to review and pay their bill if it’s easily available online.

Of course, the same basic questions about easy-to-understand statements apply to e-statements. Make sure your e-statements have an easy-to-read, intuitive layout, and provide clear directions on the accepted forms of payment and how to pay.

These changes have the potential to make a big difference in the pace and overall strength of your patient collections, while also saving you money on printing and collection costs.

Doug Fielding is the vice president of product strategy at ZirMed.

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