Modern Healthcare: Hospitals Turn To Friendlier Tools To Collect Unpaid Bills

In one of the bigger ironies of the Affordable Care Act era, when millions of people have gained access to insurance, many providers are reporting an increase in bad debt. The reason: More individuals and families are finding themselves in high-deductible plans as employers shift their benefit packages, and individuals and families buy plans on the federal or state-run exchanges, where the most popular options involve significant copays and deductibles.

New technology offerings have played a key role in giving patients more control during the collections process. Last December, Memorial Hermann Healthcare System in Houston introduced PayMyBill by technology firm Simplee, which allows patients to view and pay bills electronically. The platform also is optimized for mobile devices, which Simplee estimates represent 20% of all payments through its platform.

“We set out to engage our patients and consumers in a more patient-friendly, digital manner,” said Dennis Laraway, Memorial Hermann’s chief financial officer. “It gives consumers a chance to see their information in an organized manner, in a real-time manner. We’re going from assisted—which is very high cost—to basically unassisted.”

Patients can use a credit card, PayPal account or even set up their own payment plan without ever talking to a person. The platform also allows hospitals to link to other online services they offer, prompting patients to schedule follow-up appointments or sign up for home-monitoring services.

The digital engagement also enables Memorial Hermann to keep more of what it collects. Sending a bill to a collection agency can cost as much as 33% of the unpaid balance. By allowing patients to pay their bills online, Memorial has seen self-service payments increase 53% and reduced its collection costs by 23%.

“Once you leave the healthcare entity, it becomes a very expensive process to collect that bill,” Laraway said. “If we can get patients to self-engage, there’s virtually no cost.”

Read more from Modern Healthcare in this recent piece by Beth Kutscher.