Looking for a way to increase collections? Flexible payment plans can work

Hospital revenue cycles don't function properly unless patients pay -- the economics cannot get much simpler. 

But unless a hospital offers some sort of flexible payment plan options, certain patient groups simply won't be able to pay, with self-pay patients and those with high-deductible plans being the most vulnerable. That's bad news for hospitals and patients alike.

[Also: Healthcare turns to zero-interest loans to give patients a better reason to pay]

Integrating flexible payment options into a revenue cycle requires change that may be difficult at first, particularly for smaller hospitals and community facilities, but the way the industry is evolving, it may be the best option in the long run.

Julianne Dreon, assistant vice president of Revenue Cycle Management at AnMed Health in Georgia, has seen the industry evolve firsthand. When she first landed at AnMed, the system had a loose payment plan in place, but no one was sticking to it. Patients would pay five dollars here, five dollars there, and it wasn't really working.

Then management suggested a $25 minimum, which inspired grumbling, but ultimately proved to be a realistic expectation. They offered a 25 percent prompt-pay discount (only for uninsured patients), then offered 50 percent off of the first payment it if was made within 30 days. It worked ... better. It was as far as AnMed could get at the time, but at least it was a step in the right direction.

"When you make a change, it makes a ripple throughout the community," Dreon said. "It's a very different culture and environment, and very embedded in the community that we serve."

With a new Epic install looming, AnMed decided to take payment plans to the next level by partnering with AccessOne, which offers patient payment options. The system needed to have a program for people who truly couldn't pay -- those who were at 200 percent of the federal poverty level.

When a patient says paying is just not possible, AnMed has them complete a mini-assistance application -- if someone's going to get a full write-off, they have to prove they fit into that category. They answer questions posed by a financial counselor, who might try to get them on Medicaid. If they instead quality for full charity, AccessOne steps in.

"Our biggest fear was, 'We go live, there are these crazy plans, and people are going to go crazy,'" said Dreon. "We were drastically changing. But we were changing based on best practice, and what the industry is doing. We had to do that cultural shift with our patients."

What the system found was that most people truly do want to pay their bill -- they just need access to the appropriate avenues. AnMed itself will offer patients the option to pay $600 a month, and if that isn't happening, they refer the patient to AccessOne for additional options.

For Dreon, it's about matching people up with professionals who have adapted payment plans as their specialty.

"Sometimes it's better to partner with someone who does this all day," she said. "Hospitals are really famous for saying, 'I'm going to bring in the self-pay patients and do it myself,' but they put insurance claims people on it. It's not the same. It's not the same skillset."

Of course, every provider is different, so the best means of providing flexible payment options may differ. It takes a strong handle on a business' strengths and weaknesses to determine the best path forward. 

One thing that's universal, though, is that patients are having a more difficult time than ever in paying their hospital bills. New approaches are needed.

"Back in the day, if you had a $300 copay, it was earth shattering," said Dreon. "Today, if you have a $3,000 copay, that's a good plan. It's not possible for families to account for that in their budget. You've got to give them options. If we want to be here for patients in the future and we want to buy those great MRI machines, the bottom line has to exist. It doesn't have to be huge, but it has to exist."

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com