In the rapidly emerging era of high-deductible health plans, consumers are commonly facing bills for services they have never had to pay for. And now providers must cope with the fall-out from their patients.
“Employers are trying to shift some of the enormous costs to their employees and it can lead to ‘sticker shock’ among uninformed consumers,” says Beth O’Toole, senior director, revenue cycle, at Boston’s Beth Israel Deaconess Medical Center. To prepare patients for their financial obligations and to prevent bad surprises later in the revenue cycle, Beth Israel has begun offering a cost estimation service for certain patients. O’Toole described the effort at the Healthcare Financial Management Association’s annual gathering taking place in Orlando this week.
Beth Israel considered developing its own cost estimation system, but the effort would have been too costly and protracted, so it bought software which determines patient eligibility, scans the medical center’s inpatient and professional service chargemasters, and stacks charges against the relevant contract to determine the likely patient obligation. Loading the chargemasters and related payer contracts into the system was challenging however, says O’Toole, given the complexity of its arrangements with payers. That’s one reason Beth Israel started the effort in just one service line—obstetrics--whose services are limited and fairly predictable.
Now, prior to treatment, the medical center generates an estimation of what OB patients will have to pay. The calculation occurs when the first visit is booked and then again eight months later--to allow for any changes in insurance or service requirements. Patients receive a letter explaining their obligations. And O’Toole noted that the estimation letter does not serve as a bill.
Charles Messinger, director of training and QA for revenue cycle, added that before going live with cost estimation system, Beth Israel ran multiple tests to verify the accuracy of the information generated. “If the estimates are way off, the tool will quickly lose credibility,” he said.
Next up for the estimation service is the radiology department, a project now underway. The department was fielding patient complaints over billing, so Beth Israel hopes to help patients understand their obligations from the get-go. But both Messinger and O’Toole underscored one important lesson: service line billing practices and calculations can vary widely, as can workflow. Bottom line: analyze the local workflow before foisting cost estimation on any department.
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