The growing popularity of high-deductible health plans should cause concern among hospital and health system executives, with patients taking on more of a financial responsibility for their healthcare. However, there are some steps healthcare providers can take to help avoid some of the negative effects of the plans.
High-deductible health plans and health savings accounts are meant to incentivize consumers to manage the costs of their healthcare, and HDHP/HSA enrollment was nearly 17.4 million in January of this year, compared with 15.5 million in January 2013, according to America's Health Insurance Plans annual census.
The use of health insurance exchanges under the Patient Protection and Affordable Care Act is contributing to the rise in the use of HDHP's. Consumers using the exchanges are overwhelmingly selecting bronze and silver tier plans, which both have sizeable deductibles, according to a report from The Advisory Board Company, a research, technology, and consulting company. Therefore, even though hospitals may be seeing more insured patients, many patients still have significant financial obligations for their care.
Ten years ago, less than 5 percent of the insured population had a HDHP, compared to more than 20 percent today. In addition, a high deductible used to be $500 to $1,000, and today, 81 percent of enrollees in these types of plans have deductibles over $2,500.
Due to patients having more responsibility for their healthcare costs, a bigger part of the payer mix is going to uncollectable. "Hospitals historically have had challenges collecting patients' obligations for care, and they're going to have to get better at that," says Zac Stillerman, executive director and general manager of The Advisory Board's Revenue Cycle Solutions, who leads all member service, delivery and product growth opportunities in the firm's revenue cycle terrain.
To help offset the impact of seeing more patients with HDHPs, hospitals need to begin working with patients to fulfill their financial obligations before they receive care. Typically, the majority of patients make payments towards their hospital bills 30 to 90 days after receiving care. To survive in the new healthcare environment this needs to change, and "hospitals have to front load how the patient is going to pay," says Mr. Stillerman.
Although some hospitals feel they shouldn't collect from patients before care is delivered, more hospitals are investing in staff and technology to work with patients to get them to pay as much of their eventual obligation up front. According to Mr. Stillerman, a very small percentage of hospitals were doing pre-service collections five to 10 years ago, but today 60 to 70 percent are.
Since patients with HDHPs owe a lot more than just their insurance co-payments, it's important hospitals not only collect patients' co-payments but also attempt to get a deposit ahead of time. "Patients are 50 percent less likely to pay their bill after they leave the hospital," says Mr. Stillerman, and patients are less likely to pay a higher bill. "In the world of high-deductible health plans you have a larger population who are less likely to pay," he said.
It is vital hospitals learn to manage HDHPs now and do not postpone attempts to collect from patients, as Mr. Stillerman believes only the "mini wave" of HDHPs has occurred. "The tidal wave is that employer sponsored healthcare is moving toward high-deductible plans," he said. Nearly three-quarters of companies with more than 1,000 employees offer high-deductible plans linked to health savings accounts or health reimbursement accounts, and an additional 9 percent said they plan to add them in 2015, according to Towers Watson/National Business Group on Health employer healthcare survey.
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