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The Implications of High Deductible Plans on Your Practice

As the number of patients enrolled in high deductible health plans continues to rise, changing patient policies and procedures to collect more timely payments from those patients is an important undertaking we strongly recommend. 

While we’ve heard from many practices that addressing payment issues or implementing pre-pay policies both feel uncomfortable, not doing so can cause several serious issues for your practice.

Lost Revenue

When a patient is billed for service after the visit and fails to pay despite repeated follow-ups, the account should be turned over to a collection agent experienced in the nuances of the healthcare industry. On average about 20% of those balances will be realized after applying the collector’s fee. Simply put: Payments that are not collected while the patient is still in the office run the risk of never being collected at all.

A Drain on Office Resources

If a practice has to continuously follow up with patients for payment, and with insurance companies on claims, it’s a time-consuming effort that increases labor costs and puts staff into the role of collections agents. These tasks require several hours per day, which is time not spent on other job duties that are directly related to patient service and practice profitability. It’s also an unenjoyable role that can make a once-loved job seem arduous, draining, and full of conflict, creating both culture and retention issues that are costly and sometimes impossible to solve.

Poor Revenue Cycle Management

The more time that passes between services provided and services paid for, the greater the implication on a practice’s financial position. Cashflow delays can jeopardize timely payroll and operating expense payments, which can disrupt staff livelihoods and damage a practice’s future viability including future plans for practice upgrades, expansion, or sale.  

Strained Patient Relations

At the core of a good patient-provider relationship is quality care that helps the patient get and stay healthy. To that end, the focus of face-to-face interactions and follow-up communication between the practice and the patient should strive to center on quality healthcare. But when the lion’s share of calls or written communications become more heavily weighted toward payment issues, the relationship becomes unhealthy. Patients may delay, cancel, or simply no-show for future visits that are crucial for their continued health, which of course impacts practice revenue. They may also avoid answering calls from the office to schedule an important follow-up visit thinking it’s another call about a bill.  This results in patients developing a negative association with the practice regardless of the cause, leading to the fact they’re less likely to continue seeing that doctor and referring others to the practice.

The sooner your practice can implement systems to safeguard against high deductible plan pitfalls, the stronger your financial footing will be for years to come.

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