Hospitals are facing reimbursement challenges as patients are hit with greater financial responsibility for their care, a new analysis from TransUnion Healthcare finds.
The analysis, released June 26 at the 2018 Healthcare Financial Management Association's annual conference in Las Vegas, showed patient balances after insurance, as a total of the bill responsibility, increased over a five-year period. It was 8 percent of the total bill responsibility in the first quarter of 2012 compared to 12.2 percent in the first quarter of 2017. Patients covered through commercial insurance in particular saw their balance after insurance increase 67 percent, from $467 to $781, in that time period.
Total hospital revenue attributed to these patient balances increased 88 percent between the first quarter of 2012 and the first quarter of 2017, according to the analysis.
At the same time, hospitals are experiencing increased uncompensated care.
Uncompensated care, including bad debt and charity care, increased for the first time in three years in 2016, by $2.6 billion, according to TransUnion Healthcare, which cites the American Hospital Association's 2017 Hospital Fact Sheet.
TransUnion Healthcare, a subsidiary of TransUnion, partially attributed the rise in uncompensated care to the rise in bad debt from patients not paying their medical expenses. Specifically, the subsidiary cited data from the Healthcare Cost Reporting Information System indicating Medicare bad debt alone climbed 17 percent from 2012 to 2016.
"Higher out-of-pocket-costs from cost-sharing have made patients responsible for an increasing percentage of the bill," said Jonathan Wiik, author of Healthcare Revolution: The Patient is the New Payer and principal for healthcare strategy at TransUnion Healthcare. "Most patients simply cannot afford that, and hospitals need to make sure they're actively engaging their patients to ensure they have funding mechanisms for the care needed. Tools like propensity to pay, charity scoring and others can help differentiate a patient's willingness or ability to pay."
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