Transforming Billing Statements Into Patient-Engagement Tools
Perspective | Sally Love Connally
Senior Vice President and General Manager – Communication and Payment Solutions, Change Healthcare
Sally leads the communication business for both payers and providers. She has worked in the healthcare IT industry for more than 30 years, with leadership roles in sales, research and development, services, and support.
Healthcare billing in the United States is big business—an estimated $496 billion per year.1 Based on an analysis of a large academic medical center, the cost to collect ranges from $20 for a typical primary care visit to more than $215 for inpatient surgery.2 The growth of high-deductible health plans and COVID-19 will continue to impact the cost to collect. A national personal-finance firm reports that an additional 2.5 million people have seen their medical debt enter collections since the pandemic’s onset.3
It’s time to take a new approach to patient billing—one that recognizes patients have financial challenges and rarely possess a firm knowledge of industry practices and jargon. Viewing billing from a patient’s perspective is the key to driving both revenue as well as patient satisfaction. By using intelligent, data-driven communication, you can build trust and guide consumer behavior toward desired outcomes at a lower cost.
Challenges to Transforming Patient Financial Communications
When it comes to pre- and post-service financial communications and payment experiences, we need to assess consumer attributes, behaviors, and desires. Patients have different preferences regarding how they receive information, from texts to emails to printed statements. Additionally, some patients need a high level of detail on statements, while others want to see only actionable information, such as payment amount and due date. (For example, if insured, patients want to clearly see the amount due so they can confirm it reconciles with their explanation of benefits.)
Consumers also expect to have several payment options, from writing a check to paying online with a credit card to paying over the phone or via text-to-pay. Offering a multitude of options to address this wide range of preferences won’t happen overnight, but you can begin to incorporate changes one step at a time.
The first step is to obtain a better understanding of what motivates consumers to respond to patient statements and, conversely, what makes them set a bill aside. Change Healthcare uses a “design-thinking” approach to obtain this information. Design thinking refers to a process that incorporates end users’ input at the outset and then continually leverages their feedback to refine and improve the user experience and/or product. This differs from stand-alone A/B testing or focus groups because it brings consumers into the process from the very beginning. It starts with empathy—making sure we understand the challenges, obstacles, and desires of the user— and from there moves to defining the problem(s) to be solved, ideating around solutions, creating prototypes, and only then using testing to gather data on the most effective solution.
At Change Healthcare, the consumer-research process begins with observing consumers as they review statements, often in their own homes. This enables us to authenticate responses and actions, which has led to unique insights. For example, we’ve learned that trust is one of healthcare consumers’ most essential needs. Consumers equate trustworthiness with statements that are easy to understand, accurate, and actionable. Service-level details, placement of amount due, and clearly visible payment options are key components in driving both comprehension and payments.
Of course, as communication modes and the healthcare environment evolve, consumer preferences will also change. Another benefit of the design-thinking process is that it is iterative; designers and testers are always refining patient statements based on consumer input to help ensure the most effective solution is deployed. At Change Healthcare, we use machine-learning technology to scale and drive this iterative process.
Customizing the delivery of financial communications and offering multiple payment options is the next step to creating a personalized experience.
To address the growing number of consumers who want to receive and pay bills electronically, you can adopt a hybrid communications strategy. This entails sending a printed statement to all patients with directions for how to opt in to email/text communications and notifications if one of those delivery channels is preferred. Regardless of which channel is chosen, patients should have multiple, modern options to make payments. For example, Change Healthcare’s SmartPayTM is an integrated, omni-channel solution that enables patients to pay online or via mail, text, over the phone or automated voice-pay. Offering a plethora of payment options helps engage each demographic, drive a personalized experience (and thus, patient satisfaction), and also facilitates payments.
You can elevate the patient experience a notch higher in two ways: (1) by choosing to deliver consolidated patient statements, and (2) by sharing helpful information, including personalized health-and-wellness tips.
- Consolidated Communication
- Wellness and Support Communications
Statements can also be customized to specific populations, for example, by including mammography-screening reminders for females (age 45-plus) during National Breast Cancer Awareness Month or by including an annual retinopathy-screening reminder for patients with diabetes. Or, more generally, you can share information on how to leverage a health-savings account. This strategy both positions you as the patient’s health partner, and it also supports your population-health initiatives. Ultimately, it serves to nurture your relationship with the patient.
A Comprehensive Patient-Engagement Financial Strategy
In addition to improving patient statements, there are also opportunities to make significant improvements upstream in the process, both at pre-service and point-of-service. For example, many providers are:
- Leveraging real-time eligibility to provide patients with estimates of their out-of-pocket costs to drive satisfaction and upfront collections
- Using solutions that can uncover reimbursement sources to assist in covering the cost of care
- Setting up payment plans to better engage and motivate patients to pay
Reaping a Return on Your Investment
Adopting communication strategies that support patients’ preferences and meet their needs can help you achieve three key benefits:
- Reduced Administrative Costs
So many resources go into patient collections, including the cost of paper, printing, and postage for mailed statements; staff resources dedicated to tracking bill status; customer service for patient inquiries, and more. Patient statements designed to prompt a fast payment response, consolidated statements, and electronic delivery all help to reduce the number of statements mailed, as well as patient inquiries.
- Accelerated Collections
Providing transparency via upfront estimates on out-of-pocket costs, combined with payment plans, easy-to-understand patient statements, and convenient payment options all work together to help facilitate faster payments.
- Increased Patient Satisfaction
Creating a financial experience that meets or exceeds patients’ expectations not only helps drive revenue, it also helps to cement a positive relationship with your organization. When patients sense you are partnering to support them in understanding their costs, in making it convenient for them to pay, and in offering helpful information, it helps to drive satisfaction and loyalty.
Contact us to learn how Change Healthcare can help your organization improve its financial communications.
1. A. Jiwani, D. Himmelstein, S. Woodhandler, J.G. Kahn. “Billing and insurance-related administrative costs in United States’ healthcare: Synthesis of micro costing evidence.” BMC Health Services Research, 2014.
2. Phillip Tseng, et al. “Administrative Costs Associated with Physician Billing and Insurance-Related Activities at an Academic Health Care System.” JAMA, Feb. 20, 2018.
3. Picchi, Aimee. “A side effect of the pandemic: Soaring medical debt.” April 28, 2021.