Patient Financial Pressure

Patient Financial Pressures: A Mounting Challenge

Patients are feeling the strain of rising medical costs, though increased transparency may be the solution.

The COVID-19 pandemic has forever changed the way physicians and patients approach healthcare. These changes have impacted the costs and reimbursements presented, including the expectation surrounding patient payment obligations.

According to a study by Commerce Healthcare, 27% of patients over the age of 65 have $500 or less saved to cover medical expenses.

“For many years, the trend in patient expense obligation has marched steadily upward,” the study explains. “Growth of personal outlays is projected to rise 9.9% annually through 2026. Moreover, 10% of adults under 65 were uninsured in the first half of 2021.”

This increased financial burden on patients has led to significant complications surrounding payment processes, especially on the uninsured.

Commonwealth Fund’s study found that one-third of patients, both insured and uninsured, battled some form of medial debt, while another study reported that nearly 18% carry medical debt after receiving care, with the average patient owing a mean total of $429. The study also found that 50% of uninsured participating patients had experienced some form of billing or payment difficulty; 40% of uninsured participants reported they had trouble paying medical bills or could not do so in any form; and 24% of insured participants also reported having trouble with paying their bills.

PE GI Solutions Vice President of Revenue Cycle Management Ellen Coffee explained the reasoning behind the shift. “There’s been this cost shift to the patient through higher deductibles and higher co-insurance rates, so patients are taking on a larger liability for the care they are receiving,” Coffee says. “It has become extremely important for providers to put research into the care they are providing to be able to provide an accurate cost estimate to each patient.”

Physicians Feeling the Struggle

The result of this increased responsibility on patients is also felt by the physicians who provide their care. Patients who struggle or cannot afford to pay medical debt can cause lost profits for physicians, leading to tighter bottom lines.

Those who see others struggling to pay for care may opt to delay or refuse treatment altogether. A mid-2021 affordability survey spoke with patients of varying generations, including Baby Boomers (age 57–74), Gen X (age 42–56), and millennials (age 25–41). Results of the survey showed Gen X participants were the most likely to delay treatment or medication (37%), skip an appointment (29%), or decline treatment (25%). To avoid lost profits, healthcare providers may choose to offer more financing to patients to incentivize receiving care and meet a growing demand for upfront cost estimates.

Estimates and Patient Volume

Increasingly, physicians are seeing a trend of upfront cost estimate requests from patients in higher and higher numbers to help avoid overwhelming medical bills. A recent survey showed that nearly half of all patients (46%) requested a cost estimate from their provider prior to receiving care.

Results showed that once patients were able to see their potential incurred costs, many felt more comfortable continuing with their procedure or visit. 63% of those surveyed received care after looking over their cost, a promising sign for providers who worry that estimates may deter patients.

Only 16% of patients canceled their appointments after receiving estimates, while another 16% went in search of lower prices, but ultimately returned for care. Lastly, only 5% of participating patients shopped around for lower costs and booked care  at another location.

As physicians continue to find ways to meet the demands of their patients, simple changes, such as upfront estimates, are proving to be invaluable in not only getting new patients through the door but building the loyalty to make them repeat visitors.

“These expanded financing steps can go beyond improved satisfaction to building patient loyalty,” Commerce Healthcare’s article states. “That effort is critical to long-term provider health and is much needed in an environment in which 36% of consumers register indifference to health system brands.”

The National Conference of State Legislatures (NCSL) hopes improving transparency between physicians and patients can help implement cost saving measures that benefit both parties, and the healthcare system. Some states, such as Kentucky, Connecticut, Florida, Maine, and others, offer simple-to-use price comparison tools for patients, in the hopes of speeding up the process and assisting them in completing care previously delayed by the pandemic. Other states, such as New Hampshire and Utah, offer Right-To-Shop programs through employers, incentivizing patients to find high-quality care at a lower cost with successful results.

“Through Right-to-Shop programs, insurers typically share a portion of their cost savings with health plan enrollees to offset any pre-deductible or out-of-pocket expenses,” notes the NCSL. “Proponents of Right-to-Shop programs argue that financial incentive programs prompt healthcare consumers to utilize public price information and seek cost-effective care. However, some argue that Right-to-Shop programs are not necessarily effective, since patients often defer to physician referrals and recommendations when seeking health services rather than shop for services.”

While there is no one correct solution to the issue, moving toward increased transparency looks to be a viable way to improve results for patients while reducing lost revenue for physician providers.

For more guidance and strategies for taking advantage of healthcare trends affecting the GI industry, visit our blog at pegijournal.com.