The best ways to improve patient satisfaction around debt collection

Posted on June 27, 2022 by Kylene Ordway

Patients are now responsible for a larger-than-ever proportion of healthcare bills than ever before. Patients now have larger deductibles and have to pay closer attention to their costs. With this new swing toward the patient-as-payer, healthcare providers need to do more to keep patients satisfied and avoid patient bills from going into debt collection.

Healthcare providers today face many challenges managing patient collections. Traditional revenue cycle management is designed to optimize commercial claims and manage insurance denials — not deal with customer collections. As a result, healthcare providers are seeing:

  • The cost of collecting from patients rising. It can cost a provider 10-15% of a total bill to collect from a patient. Revenue cycle performance is also affected as providers have to spend more time dealing with patients and not processes to recoup their costs. Collections usually take longer to recoup from patients compared to insurance companies.
  • Patients become more frustrated. Many patients do not have a good understanding of their insurance plans. They may also feel like they are being overbilled and therefore drag out the repayment process.

Why is customer satisfaction so important?

Like other service-based industries, healthcare is becoming a value-based business. Patients are increasingly weighing up their options when it comes to choosing a healthcare provider and are no longer committed to one provider for life. And with increasing responsibility for payment, patients would be wise to shop around.

Today, the average deductible for health insurance is $4,364 for an individual and $8,439 for a family. The financial stakes for patients are higher than ever and are only going to continue to climb.

As patients try to meet their financial responsibilities, healthcare providers are now at risk of cash flow delays, longer waits between collections, and increased bad debt. To remain sustainable and profitable as a practice, healthcare providers need to be competitive as a service. This means making improvements to processes at every stage of the revenue management cycle with an emphasis on the customer experience.

Patients know that no matter where they go, they will have to pay. But if they can choose a provider that treats them well, makes the payment process transparent, and provides a method of paying that they prefer, there’s a high chance that they will stay on as a repeat customer. In fact, 65% of patients said they would consider switching providers if their preferred method of payment was available.

Julie Carmichael is the President of Carmichael & Company, a health strategy firm based in Indianapolis. She is recognized as a visionary leader who helped found Suburban Health Organization and served as its President & CEO for 19 years before leaving to become the System Vice President and Chief Strategy Officer at St. Vincent. She offers the following insights:

“Top performing retail organizations understand customer satisfaction is longitudinal requiring consumer-delighting service across multiple touch points. Healthcare is no different, and organizations that embrace patients as consumers and respect their purchasing power can create a competitive advantage. Studies show, most consumers prefer to receive care from a single provider or healthcare system making patient loyalty the name of the game. The stakes are incredibly high.”

She adds, “Measuring and improving patient satisfaction with the revenue cycle team is an ongoing effort. To earn patient loyalty, establish a disciplined process and stay the course. Effort drives success.”

In short, patients are looking for healthcare providers that treat them as an individual. Not a number on a chart or a faceless statistic. Healthcare providers who can achieve this will be more competitive and more likely to win the trust and loyalty of their patients.

What are the consequences of losing patient satisfaction in healthcare?

While increasing customer expectations might feel novel for the healthcare sector, other industries have felt the effects of evolving customer expectations. Many banks have had to shift the way they operate to provide more flexibility, roll out more products, and digitize their offerings.

An entire industry — FinTech — was born from this refusal of banks to give customers what they really wanted. Now, online banks are commonplace and are slowly chipping away at the market share of traditional banks.

The same could be true of healthcare providers. We’ve already experienced online appointments during the height of the pandemic. Hospitals that can provide more flexibility, transparency and ease when it comes to the payment cycle will be the ones that are rewarded with loyalty by their patients.

Consider payments from the customer’s point of view

For customers, a large chunk of the problem comes down to frustration and a lack of transparency. It’s not uncommon for patients to go in for an appointment and receive several bills weeks later for services rendered.

To succeed in building patient satisfaction, healthcare organizations need to think about their revenue cycle management from the patient’s perspective. Providers should be aware of all the potential points for friction during the patient’s appointment. These could include:

  • Lacking knowledge around what their deductible is and what their insurance covers
  • Not knowing what services were performed and will be charged for during their appointment
  • Not knowing the price of individual services performed at their appointment
  • Receiving several bills from different offices for the same appointment
  • Receiving bill statements that do not make it clear what they owe
  • Not knowing who to call to contest or clarify a bill statement
  • Not being able to pay in a way that they prefer or is convenient to them
  • Being made to feel embarrassed at any stage in the payments cycle

How to increase customer satisfaction around debt collection

One of the best ways to increase customer satisfaction around debt collection is to recoup costs before they turn into debts. Taking payment for services rendered directly after the patient’s appointment increases the chance of collecting payment.

According to the Academy of Healthcare Revenue, providers have a 70% chance of receiving payment at the time of service if they request it – but only a 30% chance of collecting it after a patient leaves the building. Healthcare providers should also strive to create a customer-centric revenue cycle.

Collecting bills from patients has always been difficult for healthcare providers. Here are some ways to reduce friction between your organization and your customers who owe.

Make it clear what the patient owes

This means bills should be clear, easy to understand, and correctly display services rendered and the cost of each service. Patients should also be told by their practices before their appointment which parts of their bill is covered by insurance and what they are personally responsible for. With clear, transparent communication, patients will feel in a position to make the best decisions for their health and their finances.

Healthcare providers should invest time in the design of their bill statements. It should be easy for patients to know what they owe, what the services were, what their insurance covers, and include a clear way to contact their provider if they have any questions or concerns.

Provide a range of ways to pay

Patients are used to paying for other bills and services in a variety of ways, whether that’s by credit card, online or on their phone. Healthcare providers should not be surprised that taking payments in increasingly outdated ways is cumbersome for the customer. Healthcare providers should allow for a range of payment options. Keeping credit card details securely on file is one way to easily process payments at no disruption to the customer.

Follow up at regular intervals for payments

Many healthcare providers send out written communications to collect debts owed, but very few reach out to patients in person. It is important that trained staff reach out to patients in a polite, friendly, and helpful manner. It’s important to note that while healthcare providers should include a range of payment options for technologically savvy patients, some older patients will still prefer to get a phone call from a real person.

Ask patients how to improve their experience

Ever wanted to know what is stopping your patients from paying? Then now is the time to ask them. Asking a range of patients what their experience is with your payment system is a great way to get feedback and look for gaps and areas of improvement. Taking this one step further, healthcare organizations can look for ways to personalize the experience for each patient. Some patients will enjoy getting paper bills, while others will be prone to ignore them and would rather have a bill sent by email.

Train staff to answer customer questions

Up until now, many parts of the revenue management cycle have been about eliminating downtime and streamlining processes. However, patients don’t want to be treated like a cog in a wheel. They want to know that if they have a question, they can ask someone and get a definitive answer.

Ms. Carmichael gives us the following detailed insights on the importance of revenue cycle teams:

The revenue cycle team is one of the most important patient satisfaction touch points.  HFMA research suggests a patient’s financial experience carries as much weight as the quality of care they received. Additionally, the revenue cycle team influences the patient’s first and last impression. We all know the importance of a good first impression but consider the power of a last impression. The last interaction with a patient has the power to: 

  •       Elevate a positive experience
  •       Cancel a positive or neutral experience
  •       Turnaround a negative experience

To be successful, the revenue cycle team must understand how patients view its service and use the feedback to drive improvement. As you build your patient feedback process, here are ways to set your organization apart and earn patient loyalty.

  •       Establish a baseline by analyzing the data your organization already collects.
  •       Read online reviews and social media posts to understand patient perceptions. Negative feedback is valuable. Even if it isn’t completely accurate, look for grains of truth and themes.
  •       Based on the data, make a prioritized list of improvement opportunities.
  •       Focusing on the top three to five items on the list, develop a performance improvement plan including at least one metric for each item. Keep them simple and clear.
  •       Share the metrics with the marketing department. They can help determine the best method to collect feedback and measure changes in patient satisfaction.
  •       Continue working down the list of improvement opportunities and use patient feedback to add new ones to the list.

Training staff on how to respond to customer enquires is important. So too is having the time for staff to spend with customers — whether at the point of service or on the phone. Healthcare organizations should prioritize having helpful staff available to talk at a range of hours convenient to your patients. Staff need to go beyond basic scripts and truly assist and educate patients in understanding their bills and how to pay.

Empower customers with greater access and transparency

Asking patients for payment has always been difficult. But by taking an empathetic customer-centric approach, healthcare organizations can switch the focus from bad debt and onto improving the customer experience. In turn, customers who know what they owe, have a range of ways to pay, and won’t hesitate to ask questions are customers who are more likely to pay.

Boosting customer experience has a knock-on effect and helps to attract new customers, just like any other service-based business. Improving the customer experience of finding, accessing and paying for care should be your healthcare provider’s number one priority.

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