As many care facilities continue to struggle with collection of accounts receivable from their patients with high insurance premiums, patient advocacy groups have began calling for increased attention to the issue of health care cost transparency. According to the Kaiser Family Foundation, 38 percent of covered employees have a deductible of $1,000 or more for single coverage. This figure is up an incredible 18 percent from 2009.
When patients are unable to cover the cost of their treatment, hospitals and care facilities are forced to write off the charges as bad debt. This can significantly affect the quality of care as the facility's cash flow is threatened.
However, to manage costs effectively, patients argue that they need to know the actual costs of various providers, and the estimated total of their out-of-pocket costs before they receive treatments. UnitedHealthcare has tried to aid its subscribers anticipate costs with its Health4Me app, which was explored in a previous post, but the service is far from comprehensive.
As explained by Douglas Ghertner, president and CEO of Change Healthcare, in a piece for CNBC Health Care, patients need "timely, actionable and personalized information so they can shop for an MRI scan in the same way they would shop for a new car – by factoring in quality, cost and accessibility." Ghertner cites a recent analysis by West Health Policy Institute that found transparency initiatives could cut $100 billion over 10 years from health spending.
Further transparency efforts could significantly benefit care facilities currently struggling with issues of bad debt. Until more options for patients are introduced, those facilities currently struggling with medical billing management should consider outsourcing outsource receivables management to see a deduction in the total number of dollars written off to bad debt.
