From physicians’ offices to medical billing companies to insurance companies, medical bills pass through many stages before patients receive them. Financial responsibility refers to who owes what for a visit to the physician’s office. Recent reports indicate that patient financial responsibility collection complaints are on the rise. Healthcare providers can maximize reimbursement and ensure adherence to debt collection regulations by outsourcing medical billing to a reliable service provider.
Practices that have proper billing practices in place and perform insurance eligibility verification to inform patients of their financial responsibility can manage patient collections efficiently. Patient responsibility refers to those areas where the patient is fully responsible for medical expenses and includes the following:
- Coordinate benefits – managing their primary and secondary health insurance plans
- Copays, deductibles, and other out-of-pocket costs
- Review of Explanation of Benefits (EOB) and contact insurer on claims processing issues
- Knowledge of their insurance information
- Bring along any referrals or authorizations to an office visit
Patients need to provide this pertinent information so that the medical billing service provider cannot determine which services are covered by the patient’s insurance plan.
Revenue Cycle Intelligence reports that research from the Frontier Group and the US Public Interest Research Group (PIRG) Education Fund indicates that medical debt collection problems are widespread across the U.S. The study found that patient financial responsibility collection complaints rose 29 percent from 4,484 in 2014 to 5,785 in 2016.
Increased patient financial accountability is mainly due to the fact that more patients are now in insurance plans that come with lower premiums and a higher deductible, which they are responsible to pay. The higher financial responsibility is one of the main reasons why patients are taking longer to pay off their medical bills. According to a recent Navicure survey, 50 percent of providers said that it usually takes three or more months to receive full patient balances.
The key issues reported by the Frontier Group and US PIRG Education Fund study are:
- 63% of complaints relate to debt that was never owed, already paid, or never verified: 24 percent of complaints were “Debt is not mine”, followed by “Debt was paid” with 21 percent, “Not given enough information to verify debt” with 15 percent, “Right to dispute notice not received” with 8 percent, and “Attempted to collect wrong amount” with 7 percent.
- The remaining 37% of other complaints includes aggressive or inappropriate debt collection tactics
- As of March 2017, 14 percent of all debt collections complaints related to medical billing and patient collections.
- The highest proportion (48 percent) of patient financial responsibility collection complaints related to “Continued attempts to collect debt not owed”
The researchers say that the increase in medical debt complaints could be the result of errors in medical billing such as incorrect payment entries in the billing system, insurer-related glitches which delayed payments to the physician, or provision of wrong demographic data when bad debt was sold to creditors.
Inappropriate patient collection practices can lead to heavy penalties for medical practices. The Frontier Group and US PIRG Education Fund study suggests that providers wait 180 days before reporting medical bills to debt collection agencies. They should also inform patients when their overdue medical bills have been reported.
Collecting payments at the time of service is one of the ways practices can increase revenue. Verifying patient eligibility before services are rendered will give providers a clear idea about patients’ payment responsibility. Insurance coverage differs considerably between companies, individuals, and plans, and expert billers will check each patient’s coverage so as to assign the bill correctly. Patients can be informed if their insurance does not cover the procedure or service to be rendered, so that they can be billed for these items. A reliable medical billing company will also follow up on patient payments and handle collections efficiently.