As the world of health care payments becomes increasingly complex during the pandemic, many people have faced difficulties due to unexpected medical bills. Most adults want a price estimate when it comes to health care.
The need for payment transparency spans generations; 84% of Millennials and Gen Zs and 65% of Baby Boomers want medical services to be priced in advance, yet only half of these estimates are accurate.
In 2019, 40% of consumers were shocked by a high medical bill. About half of these astonishing medical bills came from hospitals, and 20% came from surgery. The majority fear they won’t be able to afford an astonishing medical bill. Even with employer-sponsored insurance, that fear persists, and 4 in 10 struggle to afford health care.
So, why are medical costs so unpredictable? The rise in popularity of high deductible plans can lead to payment confusion. They have grown by 450% over the past decades with a health savings account and 231% without a health savings account.
About 20 million American adults with employer-sponsored insurance were enrolled in a high deductible plan from 2007-2017. 69% of patients are proactive about responsibility for payment and try to learn about costs before or during their appointment.
However, patients who transfer to these high deductible health plans often struggle with high out-of-pocket fees, confusion over payment accountability, and an increase in unexpected medical bills.
Another consideration within the healthcare industry is wasteful spending. Time is a big factor because a quarter of this expense is related to the time and money required to collect, process, post, and record payments. This complexity is due to the different areas where payment is collected – both on the insurance and consumer side.
All the processes involved here are processed at different times in the payment cycle, making it harder to manage. For example, accepting a payment of only $20 in cash can cost up to $50 to process.
Another way healthcare facilities lose currency is through denied claims. One-tenth of insurance claims are denied, and of that amount, 35 percent go through reprocessing and reintroduction. Reworking and resubmitting an already denied claim can pile up cost-wise, which is 18 times more than a claim that was filed right from the beginning.
That being said, 90 percent of rejected claims can be avoided. Reducing the amount of rejected claims can save medical practices thousands of dollars annually. Disapproved claims usually arise from simple errors that otherwise could have been easily avoided.
Human error can usually capture patient information such as prior authorization and out-of-network providers. That said, other mistakes happen through manual data transfer between different systems.
Payment issues in health insurance eligibility verification are a headache for everyone involved. So contactless check-in and payments, and connecting healthcare systems are game changers. An average medical practitioner can save up to 11 hours of administrative time per day and up to $4,500 monthly by employing automated insurance eligibility verification.
Pre-registration collects the patient’s photo ID and insurance card, as well as their demographic data. It verifies that coverage is valid at the date of service, confirms the patient’s responsibility for copies and coinsurance, and identifies the insurance payer and where the claim is routed.
Switching to contactless check-in and payments during the global pandemic was a welcome switch to paperwork and helped contain the spread of infections. This reduced the time spent checking and inputting paperwork, while minimizing patient-to-patient interactions. Using this enhanced check-in process, patients have been able to complete coronavirus screening, consent forms and insurance documents.
Integrating health care systems in a way that is beneficial to all parties involved in the management of health care payments has become increasingly important. Patients can easily check in and save their information with a single login.
Office workers reduce their risk of infection through the exchange of documents and payments and eliminate rejected claims from wrong insurance cards. Meanwhile, insurance providers experienced a reduction in administrative workload, resulting in higher productivity and lower costs. Insurance companies were also less likely to face deficiencies, administrative hassles, and even experienced a reduction in business.
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Author: Brian Wallace
Brian Wallace is the founder and president of Nowsourcing, an industry-leading infographic design agency based in Louisville, KY and Cincinnati, OH, that works with companies ranging from startups to the Fortune 500. Brian also runs #LinkedInLocal events nationwide, and hosts the Next Action podcast. Brian has been named a Google Small Business Advisor for 2016–present and joined the SXSW Advisory Board in 2019.