Due to the dramatic increase in the volume of patient responsibility, many hospitals are receiving more self-pay patients. These patients have high-deductible health plans (HDHPs) which means more out-of-pocket expenses for the patient. The problem is that many of the patients have difficulty paying their bills. In fact, a recent study showed that hospitals can expect to lose 65 cents on every dollar collected.
But before you throw up your hands in defeat, there are ways to deal with it and that is by using a technique that sales people (and more lately, ecommerce companies) have been using for years. Salespeople rank their clients (or potential clients) into specific categories based upon their likelihood of purchasing a product.
Skilled salespeople divide their client into categories “A”, “B” and “C”. The “A” clients are those that are most likely to purchase or purchase again. The salesperson then devotes significantly more time to the “A” clients than to the others.
In the financial services industry this is called “Propensity to Pay”, or P2P. Financial services companies have long been using P2P data to identify the accounts they are most likely to collect from. They will then keep those accounts in-house and deploy a strategy to work with these clients to ensure the client has easy payment options as well as excellent customer service to ensure they pay on time regularly. When healthcare providers are initially talking with patients, they should have their antennae up looking for the high propensity-to-pay patients.
By spotting the high P2P accounts first, those accounts can be kept in-house thereby mitigating inflated costs to collect due to higher percentages of cash flow coming from patients instead of insurers. They also collect on a higher percentage of accounts with relatively little effort.
Think of high P2P accounts as low-hanging fruit. For this segment of accounts, in many cases, all a hospital has to do is send a statement and expect a payment in return. Even better, they are more likely to set up automatic deductions.
Working with high P2P patients is most effective when they are identified in the initial pre-treatment consultation. How can you identify a high P2P patient? Work with your Information Technology (IT) team to collect and analyze data from previous patient transactions. High propensity-to-pay patients will have recurring patterns in terms of credit scores, timeliness of payments, down payments and other criteria.
What should you offer them? A multitude of payment options including online, agent-assisted, automatic payments and mobile payments is a very good start. Most people want to pay their bills and by offering multiple methods of paying (especially interchangeably) you are helping them be flexible in their payments. In addition, give them the highest customer service. Assign a specific agent to them. Consolidate as many bills as possible so that the patient is not surprised by bills they do not recognize. Finally, always be ready to answer their questions quickly.
High P2P patients are the best to have. Make sure your collection software gives them multiple methods to pay and that it is easy for them to use. The higher the customer satisfaction, the more likely they will make their payments on time.
For more than a decade, BillingTree has been committed to understanding the marketplace and growing payments with technology, to help clients grow their business. To learn more about how BillingTree can help you, contact BillingTree or call us at 877-424-5587.