Personalized payment techniques: How to leverage big data for hospital financial success

Often times, big data is discussed in terms of the clinical insight it offers physicians and researchers in the realm of population health and behavioral change, but such data can also offer insight to inform more immediate actions, such as payer negotiations or identifying personnel productivity. All of these actions — both long- and short-term — influence hospital success.

"We've survived for a lot of years with regards to small data, and now there's just been an onslaught of accumulation of information, everything from your mobile phone to your car," said T. Scott Law, founder and CEO of a leading revenue cycle management services provider Zotec Partners, in a recent webinar hosted by Becker's Hospital Review. "Everything you do is collecting data points that can be impactful for business."

Mr. Law talked about the Google effect, or the idea that people are no longer ever at a loss for answers because of powerful search engines. With data, gut reactions and personal bias have been essentially eliminated from business decisions because the data provide many of the sought-after answers.

For example, one radiology practice conducts 300,000 procedures per year, which generates approximately 250,000 claims per year. One claim requires about 350 data elements. That equates to 87,500,000 pieces of data elements each year from just one radiology practice. Four practices with similar case volumes would generate nearly 350 million data elements a year, such as social data, demographic information, social patterns, clinical data and buying patterns, including when patients like to pay their bill.

"You can bring all those things together under one data warehouse to get a feel for what kind of information you can stratify into those actionable data items," Mr. Law said.

Zotec Partners' platform draws from the troves of data to create personas of individuals and payers to optimize the billing process by determining an individual's propensity to pay or the propensity for friction. Knowing these tendencies ahead of time allows hospitals to tailor billing interactions and collection techniques to individuals to minimize friction and maximize collections.

Based on a person's characteristics and tendencies, hospitals can decide how to best interact with an individual and ultimately collect money. For example, a patient's demographics can suggest the likelihood that he will respond to a text message notification about medical bills versus receiving bills in the mail.

Understanding patients' proclivities toward payment is increasingly central to billing and collections as the healthcare industry becomes more consumer-centric, especially in an era when high-deductible health plans are more popular and patients carry more responsibility for their coverage, according to Mr. Law. "We've transformed this business, which used to be a physician-to-carrier relationship, into a physician-to-patient or -consumer relationship," he said. "That forces consumers to do what consumers do, and consumers want to have that Amazon or Uber or Google search experience with their healthcare."

With patients relying on their time-tested consumer behaviors and tendencies in the healthcare industry, it is incumbent on hospitals to meet consumers where they are. This is where big data can come into play.

"You should be mindful of who you're dealing with on a patient-by-patient block so you can customize the patient experience and get the best results," Mr. Law said.

Not only is billing and collections the lifeblood for hospitals to remain financially sound, but it may play into patient satisfaction scores as well. If a billing technique increases a patient's frustration with the hospital, it ties to a patient's propensity to complain. A 2016 study found 74 percent of satisfied patients paid their medical bills in full, compared to 33 percent of their lesser satisfied counterparts.

"The juice might not be worth the squeeze to go after them with hard collection techniques," Mr. Law said, because that frustration could translate into overall dissatisfaction and negatively impact hospital quality measures. "You have to think through the entire transaction and impact on an entire organization with regards to these items."

Hospitals can also use such data to glean insight on business analytics and physician benchmarking. Zotec Partners' technology can demonstrate which billing and collection process changes are producing a profit, according to Mr. Law. Users can see which locations and times of service produce the most desirable outcomes, and leverage that information to more effectively staff facilities during peak hours and peak patient volumes.

"It makes a [positive impact] to know what you're working on is either producing an ROI or a contribution to the overall organization," he said.

To view the webinar presentation, click here.

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