Hospital revenue cycle must be ready for ACA open enrollment

“Some of these people haven’t had healthcare insurance before, so it’s a new language for them,” Zimmerman said. “Your front office staff needs to be pretty good at explaining how their plan works and what that means to the patients themselves.”

The second enrollment period for Americans to buy health insurance under the federal Affordable Care Act begins Nov. 14 and will extend through Feb. 15, 2015.

For many Americans, the ACA open enrollment offers them an opportunity to have health insurance for the first time. For hospitals and healthcare organizations, ACA open enrollments create financial and operational challenges as they try to cope with an influx of new patients who already have health problems and may be at risk to pay.

“The people who are enrolling in these plans generally are sicker,” said Jon Zimmerman, vice president and general manager of clinical business solutions at GE Healthcare. Which means they’re more likely to seek treatment under the terms of their new health insurance plan.

The problem is that many of these new patients may be facing extremely high deductibles or coinsurance costs. For example, the “bronze” and “silver” plans offered under state healthcare exchanges can require deductibles of as much as $2,000.

[See also: Assessing next generation revenue cycle management readiness.]

“They may think, ‘Well, I’ve got insurance, everything’s paid for,’ when it’s not,” Zimmerman said. “Their plans may have specific and important deductibles, so when they show up, you better know what kind of financial liability this individual has under their new plan.”

This is critical because many patients may be confused by details of their plans and what their own financial responsibilities are under a specific plan.

“Some of these people haven’t had healthcare insurance before, so it’s a new language for them,” Zimmerman said. “Your front office staff needs to be pretty good at explaining how their plan works and what that means to the patients themselves.”

It’s also imperative to establish mechanisms for collecting from patients up-front because “when they’re gone, they’re gone, and it’s really hard to collect afterwards,” Zimmerman said. “What processes and tools do you have to enable upfront collection? That’s a big deal.”

One option would be to provide “some level of financial counseling” as well as offering payment plans for patients who simply don’t have the money to pay for their healthcare services under the terms of their new insurance, he said.

If you’re going to be great at revenue cycle in this new tidal wave that’s coming, you better have the right people, process and tools in place.

Hospital CFOs also should have a thorough understanding of the rules and requirements of plans being offered under ACA.

“Know your payers and their rules,” Zimmerman said. “What are the risk and performance characteristics of the contracts with the folks who are offering these exchange products? What are your authorization requirements? What are your reporting requirements? It may be more than just eligibility and patient liability. There might be some new authorization rules. There might be some clinical quality reporting rules.”

Hospitals that aren’t prepared for handling new patients under ACA may need to purchase an entirely new patient intake and billing system or add a “bolt-on” solution to the current system, Zimmerman says. Before running out and spending money, though, hospitals should first ask their current billing-system vendors if they will be able to support billing requirements under the new healthcare law.

“If you’re going to be great at revenue cycle in this new tidal wave that’s coming, you better have the right people, process and tools in place,” Zimmerman said. “Because you’re dealing with a new reality.”