Q&A: Keeping Insured Patients off Bad Debt Rolls

Troy Roth, vice president of revenue-cycle product strategy for MedAssets, discusses how hospitals can calculate how much is owed by patients with high-deductible policies.

Question: What is the trend with high-deductible insurance policies?

Troy Roth: More patients are on high-deductible insurance plans, meaning they now have a lot to owe when they come in for care. High deductible plans are responsible for a major shift in the nature of bad debt. Among MedAssets clients, 60 percent of their bad debt now comes from self-pay patients after insurance has paid its share. Often these are people who have a job and don’t know how they can pay their bill.

Q: How high can the patient's portion of the bill be?

TR: High-deductible plans can be as high as $5,000. In addition, the patient may be responsible for 20 percent of the bill and some services may not be covered at all by insurance. If you are making $12 an hour and you get a bill of $5,000 or $6,000, it will seem astronomical to you. You're probably going to shift that bill off to the side.

Q: What can the hospital do to get the bill paid and keep it from becoming bad debt.

TR: You can counsel the patient and help get them into a payment plan. But most hospitals have financial counselors already. What they may not have is a way to provide patients with an estimate of the bill before they are seen. If patients can get an estimation of the cost before they come in, it has been shown they are more likely to pay. They have a chance to consult their finances and remember to bring their credit card along.  

Q: Will bad debts continue to be a problem under healthcare reform?

TR: The problem could get worse. Right now, hospitals can write off bad debt as charity care and receive disproportionate share hospital payments. But Medicare will reduce disproportionate share hospital payments in 2014. At the same time, states will increase Medicaid eligibility levels and people who still don't qualify for Medicaid would be required to buy insurance or pay of fine. But even after the coverage mandate kicks in, the Congressional Budget Office has estimates that 23 million people still won't be covered.

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