Paper refunds are out: How automation boosts patient experience + provider efficiency

Patient refunds from providers are on the rise. Unfortunately, refund processes tend to be  manual, complex and time-consuming for both providers and patients alike, with traditional  paper-based methods no longer matching the  needs of consumers.

Becker’s Healthcare recently spoke with Sue Martin, senior vice president of healthcare specialty services  for CommerceHealthcare®, about the burdensome nature of patient refunds. She shared how electronic  refunds can benefit key stakeholders in healthcare. 

“People must advocate for themselves,” Martin said. “That means keeping up with appropriate insurance payments, as well as tracking where their self-pay dollars are being applied and where they may be entitled to refunds.”

Why paper refunds aren’t cutting it

The traditional paper-based refund process has significant drawbacks. For providers, paper-based processes are inefficient, take more time and require additional labor. These antiquated processes are even more problematic as providers struggle with labor shortages and narrow margins in today’s worsening economic climate.

Paper-based processes also are not ideal for patients, especially in an environment where so many consumers engage in online banking due to the convenience. It can be time-consuming to receive refund checks via the mail, and the traditional bank deposit process takes extra time. In addition, paper checks are prone to getting lost. Patient addresses change frequently — especially with the recent increase of hybrid and remote work — which can  lead to untimely mail delivery, lost checks, fraud and  the cost of reissuance. “We hear about these challenges on a regular basis from clients,” Martin said.

Technology offers refund transparency and efficiency

Thanks to technological advances, it’s now possible to offer greater transparency about refunds to providers, payers and patients. CommerceHealthcare® offers its PreferPay® solution, for example, which is a secure, end-to-end automated refund process that integrates with provider solutions. 

PreferPay® supports a variety of payment options including direct debit cards, direct deposit to a bank account and traditional paper checks. Offering multiple refund options is a huge step forward that improves providers’ patient satisfaction scores.

“Consumers are looking for the same experience in healthcare as they have with their banking and shopping partners,” Martin said. “Today, patients often have to wait for a paper refund check to arrive in the mail from their providers. With PreferPay®,  they can get the funds owed to them in as little as 30 minutes.”

Providers are seeking more streamlined refund processes

Healthcare organizations of all sizes face challenges in processing patient refunds. Manual, paper-based systems commonly require multiple solutions and multiple departments to complete the entire process. Another major concern is the effort associated with escheatment of unclaimed funds. This is yet another set of tasks facing an already overburdened, understaffed workforce.

Transitioning away from paper processes makes sense, but it’s important to work with a trusted partner. “You want all the departments involved in the refund  process to experience seamless workflows,” Martin said. “CommerceHealthcare® works with providers to implement best practices and ultimately migrate to fully digital patient refund functionality.”

Initially, providers may default to traditional check payments for refunds. Over time, however, as more information is obtained — like patients’ mobile phone  numbers and email addresses — the system can increase the level of automation and the number of paper refund checks can be reduced. “This enables our clients to fully transition the patient refund process and offer a true end-to-end solution, which includes escheatments for any unclaimed funds,” Martin said. 

Getting started on the electronic refund journey

A current-state review is a good first step on the transition to electronic patient refunds. It’s important to understand the true costs associated with issuing a paper check. Martin recommended tracking the costs surrounding check stock, printing and postage, as well as team member time spent processing the checks and following up, which should shed light on  potential for return on investment.

Another best practice is to look for a partner and a solution that will work easily with the organization’s treasury and receivables teams. Refunds routinely require processing from both accounts receivable and accounts payable for authorization and issuance of payments. These departments also need a workflow for tracking unclaimed payments. 

Automated payment solutions can deliver value beyond patient refunds

In addition to processing patient refunds, PreferPay® can also streamline process flows that are critical  to a strong employee value proposition. For example, Martin explained how the organization helps HR departments by focusing on frequency of employee payments. 

“We’ve instituted workflows learned from other industries to drive better employee recruitment,  retention and overall employee satisfaction,” Martin said. 

Automated payments also can be useful in areas like clinical trials and contract workers. PreferPay® can be applied to other use cases, and it’s not a heavy lift —  the workflows are similar, even if the parties receiving the payment are different. “Take the automation and think bigger with it,” Martin said. “You’ll find it to be a true success.”

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