Per the Hospital Accounts Receivable Analysis Report on Fourth Quarter 2015, hospitals in the United States reported an increase in the quantity of their accounts receivables that have aged more than 90 days in the fourth quarter last year.
Accounts receivables (A/R) that have aged more than 90 days were reported as 26.06 percent of the total A/R in the fourth quarter. This can be problematic because the benchmark to which hospitals hold themselves is having 90-day accounts receivables being less than 25 percent of total A/R.
Why is this? Because with the Affordable Care Act self-pay did not “go away” as some hospitals hoped. Patient responsibility is not shrinking; it is growing. As a result, bad debt is growing, the cost to collect has more than doubled and patient collections are down.
Statistics show that one of the causes is that those who are newly insured through the ACA tend to have high-deductible plans. According to the Centers for Disease Control and Prevention, 36 percent of those covered today have high-deductible plans, compared to only 25 percent of plans issued in 2010.
So how can hospitals recover more of the accounts receivables? According to the Healthcare Financial Management Association (HFMA) 2016 study titled “Self-pay and the benefits of prospective patient engagement”, healthcare providers are focusing on pre-service cost counseling as well as automating payment collections to increase post-care payments.
This is where offering a wide variety of payment plans to the patient can help healthcare providers collect more of their debts from patients. Most patients would probably like to pay their bills; they just cannot pay them all at once. By offering a variety of payment plans and a multitude of payment methods and payment solutions such as credit card, debit card, ACH, web portal, virtual negotiators and Interactive Voice Response (IVR) systems, the patient will feel more in control of the payments and less likely to delay payment post-care.
In short, an increase of accounts receivable that have aged more than 90 days is an opportunity for your agency to offer your services to the healthcare providers. Assisting in debt collection will help them and help your business grow as well.
For more than a decade, BillingTree has been committed to understanding the marketplace and growing payments with technology, to help clients grow their business. Contact us today to see how we can partner with you to bridge the technology gap and stay up-to-date on the latest in payment processing.