The cost of healthcare is a continual point of contention for patients and providers alike. Patients want to know their financial responsibilities before receiving medical services, while healthcare providers aim to improve their revenue cycle management (RCM) and ensure timely payments. In this context, patient liability estimates have emerged as a vital tool to bridge the gap.
Liability estimates provide patients with valuable insight into their out-of-pocket expenses, enabling them to make informed decisions about their healthcare. Simultaneously, healthcare organizations benefit from better RCM, reduced bad debt, and enhanced patient-provider communication. Here’s a look at the power of upfront, honest communication about healthcare costs.
Financial transparency
One of the most significant advantages of patient liability estimates is their potential to reduce financial surprises. Patients are spared the shock of unexpected medical costs, which leads to a deeper sense of trust in their provider. This, in turn, fosters a platform for productive discussion about available treatment paths and their financial implications.
Financial transparency is empowering for patients, who can prioritize treatments that align with their medical needs and economic capabilities. Moreover, providers can offer more informed recommendations about care when they understand a patient’s financial concerns. In this way, liability estimates contribute to a healthcare experience founded on transparency and mutual understanding.
Payment planning
The transparency created by patient liability estimates also allows for payment planning. With a comprehensive view of their out-of-pocket expenses prior to care, patients can proactively prepare for impending medical costs. For example, they might get a better picture of how to utilize their health savings account (HSA) or flexible spending account (FSA) funds. At the very least, it leads to preparedness and can facilitate preemptive discussions about payment plans or similar programs.
Patient liability estimates also hold substantial benefits for healthcare providers. By facilitating the process of payment planning and upfront financial awareness, providers are better positioned to reduce unpaid patient balances and mitigate bad debt write-offs. This not only simplifies RCM but also protects practices and providers from a degree of financial uncertainty.
The bottom line is, when patients can plan for their liabilities, providers can plan to prevent cash flow gaps.
Streamlined RCM
Educating patients about their financial responsibilities is a cornerstone of billing and RCM. Done right, it does more than make patients aware of their financial obligations; it also reduces the likelihood of billing disputes and subsequent delays in payment processing.
Manual follow-ups, complicated payment negotiations, and resource-intensive collection efforts are all streamlined when patients understand their financial responsibilities from the outset. Patient liability estimates even enable providers to collect payments upfront. By taking away the unknown variable of cost, providers can kickstart an open conversation about payment.
From a broader perspective, the incorporation of liability estimates into RCM contributes to the financial stability of healthcare practices. By improving revenue cycle performance and reducing instances of unpaid patient balances, providers can create a more predictable cash flow while fostering a better patient-provider relationship built on trust and transparency.
Upfront cost conversations
Discussing the cost of healthcare isn’t a comfortable conversation for either side, but it’s a conversation worth having. When approached with transparency, it facilitates a better healthcare experience right from the outset. By promoting financial transparency and empowering patients with upfront cost information, liability estimates allow for informed decision-making and minimize financial surprises. Providers benefit from better RCM and improved patient-provider relationships. It’s a win-win for both sides.
Learn more about the benefits of patient liability estimates with TruBridge.
