High-Deductible Plans Create Problems for Patients, Providers, Report Finds

High-deductible plans cause patients to delay care and create headaches for doctors and hospitals when they don’t get paid, according to a new report released today by West, which provides patient engagement technology to healthcare organizations.

The report, “Optimizing Revenue,” finds that 56% of patients put off paying medical bills for a variety of reasons, with 67% saying their finances make it tough to pay bills on time. But there are other reasons, including confusion over what insurance will pay and frustration when bills arrive for things patients believe should be covered. One-quarter hold off paying medical bills until they know they are paying the right amount.

What’s worse, patients are forgoing preventive care because of high deductibles, even though this kind of care would help hold down healthcare costs in the long run: 75% of women, 40% of men, and 42% of patients with chronic disease say they’ve put off screenings due to high deductibles.

Providers could be part of the solution, yet too few are. The report finds 85% of patients say they wish their doctor or hospital would say upfront what treatment will cost and when they will be billed.

“Providers can open the door to payment discussions by using the automated voice message, email or text message appointment reminders they are already sending in advance of scheduled appointments to inform patients of potential copayments and out-of-pocket costs,” Allison Hart, West’s chief marketing research and insights strategist, said in a statement. “By making this simple adjustment, providers can start conversations that identify payment barriers and help patients overcome those challenges.”

Patient Cost Shares Are Rising

It’s not patients’ imagination that they are paying more for healthcare: they are. The average annual deductible for a family policy in 2017 was $8232 on the Marketplace exchanges, and the annual deductible rose $239 between 2016 and 2017.

Paying medical bills late is so common that 12% report they are “always” delayed and 16% are “frequently” delayed, and this trend is even more common among millennials (70% vs 50% for everyone else), mostly because they earn less.

Where Providers Fall Short

Providers know this is a problem—95% say so. Yet only 36% have ever discussed a patient’s ability to pay before offering services, and even fewer (23%) make it a habit. The West report said this is a mistake:

“By initiating conversations about cost, providers can identify payment barriers and help patients overcome those challenges,” the report states. “This practice also has the added benefit of reducing patient anxiety, making patients less likely to put off receiving treatment.”

Sending messages before the bill arrives lets patients know what to expect, which helps reduce their anxiety and confusion, lets them know what portion will be covered by insurance, identifies any issues that need to be resolved with the insurer, and prevents late payments, the report states.

Success Stories

The report advocates using the same technology that many providers already have in place to alert patients of upcoming appointments to remind them about late bills. Only 31% do this, even though automated phone calls and texts cost less than mailed notices. The report cites an example at the University of Missouri Health Care, which began sending automated reminders and reduced outstanding accounts receivable by $463,000 a year. MU Health Care collected $115,941 just in the first 3 months after switching to this system.

Similarly, Ochsner Health System used its automated appointment system to book preventive screenings for colorectal cancer. Over 2 months, Ochsner sent automated phone notifications to patients who already had a colonoscopy order but had not shown up for the test. As a result, Ochsner brought in $685,000 in additional appointment revenue for this screening, which is recommended for all adults once they reach age 50 and at intervals after that.