How to think of consumer-based health care

A hospital’s patient experience and revenue cycle management are two aspects that don’t normally overlap. However, thinking of these two elements as inherently separate can be a critical mistake. With more hospitals moving toward value-based care, or care in which quality and payment are linked, it is increasingly important that health system administrators understand that consideration of all hospital components as related to the consumer are essential to remaining successful.

Hospitals are already set to see – and have seen – declines in Medicare reimbursements. According to the American Hospital Association’s latest survey, U.S. hospitals were underpaid by Medicare and Medicaid by $56 billion in 2012. Now, put low patient payments on top of that value of uncompensated care, and it becomes clear that hospitals must do all they can to improve patient collections and their overall RCM solutions.

For many health care veterans, thinking about the patient experience as part of the hospital’s RCM system can be tricky, as it didn’t matter monetarily how patients perceived their care under the traditional system. Yet in our increasingly consumer-driven society, how patients perceive their level of care quality is directly related to how quickly they will pay off their medical bills. While patients do have a responsibility to pay for their care, health systems also must make it as easy as possible for them to do so. In fact, as health care becomes more consumer-based and the entire industry adopts pay-for-performance models, it will soon become hospitals’ obligation to simplify their billing processes.

What is consumer-driven care?
It isn’t easy for people to think of health care in terms of having consumers, but the health care industry does, in fact, rely on patients as consumers. Consider it like this:

Providers already have relationships with their patients in a way that builds loyalty and trust. Few industries have such a strong and critical dynamic between salesperson and consumer, which makes it especially difficult for the idea of consumer driven health care to make sense to many in the health care industry. However, the Healthcare Financial Management Association notes hospital administrators and physicians need to discover what many in the retail environments already have: to receive payment, you need to manage the customer experience. In essence, health systems need to realize that patients have options these days. If they dislike the care they receive at one hospital, there are probably physician practices or smaller clinics in the area that they will enjoy more. In fact, researchers in California recently found it the cost for a woman to deliver a child in the state ranges between $3,000 and $37,000, NBC News reported. If a woman is going to go with the hospital with the $37,000 price tag, she needs to know she will be receiving top-quality care, otherwise she might look for providers who can offer great care at a more affordable price.

Much has been said about improving care quality, but the Beryl Institute notes patient experience comprises of four elements: interactions, culture, perceptions and continuum of care. RCM is a key touchpoint between the hospital and the patient throughout his or her entire experience. Consumer-driven health care empowers patients to take a greater role in their care quality – and billing is a significant factor. HFMA suggests hospitals rethink how they view their revenue cycle in terms of consumer health care. No longer can every aspect of care that does not involve payment remain out of sight. All of the processes between care delivery and payment influences consumer satisfaction, which directly relates to the health system’s receipt of payments. According to Healthcare Finance News, hospitals must optimize their RCM to be successful in consumer-driven health care by improving their billing touchpoint with consumer friendly billing.

Increase patient payments through consumer friendly billing
Consumer-driven health care is the end of the old way hospitals did business and the start of improving the overall patient experience. Hospitals have a chance to boost their patient collections by showing they understand patients want price transparency and easy-to-read bills. For customers to pay their bills in a timely manner and stay with their providers, hospitals must give them the tools they need to do so. Consumer friendly billing engages patients as the consumers they are through collecting part of payment at the point-of-service, providing cost estimations and allowing patients to pay online. Giving patients payment options can round out the entire patient experience and help hospitals transition to consumer-based health care.