An IMS Institute for Healthcare Informatics survey released April 4 shows a drop in physician office visits and prescription use. As patients struggle with high deductibles, co-pays, and general economic issues they are more likely to ask their physician about cheaper alternatives for tests and prescriptions, or to find other alternatives rather than seeing their doctor.
IMS’ report findings are similar to reports from the Kaiser Family Foundation and Chase health industry analyst John Rex. Their reports also found a decline in office visits. Another survey report, released November 2011 by Commonwealth Fund, said 42 percent of “sicker” adults had more cost-related access problems than in the previous year.
IMS’ report found that from 2010 to 2011:
- Retail pharmacy prescription spending declined 1.1 percent.
- Prescription spending by insured patients ages 19-25 went up 2 percent.
- Patients 65 and older spent 3.1 percent less out-of-pocket for prescriptions.
- Ages 65-69 had the biggest prescription decline, with a 4.3 percent drop.
- The biggest prescription decline was for those treating hypertension.
- Non-emergency hospital admissions declined 0.1 percent.
- Emergency admissions went up 7.4 percent.
The increase in emergency admissions is an indicator that patients are reluctant to seek medical treatment from their physician office or to take medications because of financial concerns. Larry Levitt, senior vice president of the Kaiser Family Foundation said, “It suggests people are putting off care, and they’re showing up sicker.”
According to the survey, here are the statistics showing the number of office visit changes from prior years:
2002 – 1,503,225,000: 2.7%
2003 – 1,589,694,000: 5.8%
2004 – 1,565,978,000: -1.5%
2005 – 1,654,375,000: 5.6%
2006 – 1,670,502,000: 1.0%
2007 – 1,624,189,000: -2.8%
2008 – 1,627,786,000: 0.2%
2009 – 1,602,354,000: -1.6%
2010 – 1,535,506,000: -4.2%
2011 – 1,468,265,000: -4.7%
Advice for Physicians Who are Seeing a Decline
According to an amednews.com article, here’s what physicians can do to make it more likely that financially strapped patients will follow advice for prevention and treatment:
- Explain the value of the recommended medication, test, or procedure even if the patient doesn’t ask. Barry Make, MD, a pulmonologist with National Jewish Health in Denver, said, “Patients will only do something if they understand what it is for, but patients are often reluctant or ashamed or embarrassed to ask.”
- Make it clear that some negotiation is possible if cost is a significant concern. For example, see a patient every four months rather than every three.
- Steer patients to lower-cost prescription resources and write prescriptions for drugs to be filled cheaper at big pharmacies.
- Guide patients to drug assistance programs or discount programs.
Source: IMS Institute for Healthcare Informatics “The Use of Medicines in the United States: Review of 2011“
April 27th, 2012
The American Medical Association’s (AMA) fourth annual National Health Insurer Report Card has good news for some payers, but not for the industry as a whole.
Overall, the rate of inaccurate claims payments increased 2 percent since last year’s report card among leading commercial health insurers, the AMA said. The commercial claims processing error averages 19.3 percent, the latest study found. This results in $3.6 million in erroneous claims payments and $1.5 in unnecessary administrative costs in the health system, the AMA maintains.
July 1st, 2011
The high cost of health insurance has contributed to a sharp rise in deductibles, which may range from $1,000-$5,000. For 2011, Medicare Part A deductible increased $1,132 and Medicare Part B for outpatient services increased $162.
High deductibles can decrease your cash flow, especially during the months of January through March. Patients, especially those who are out of work or on a tight budget, usually consider medical bills a low priority on their list of necessities.
However, even if it is legal, collecting deductibles up front may not be a good business practice. It could end up costing a practice more to collect up front and then have to refund them later in view of increased overhead, including clerical and bookkeeping expenses. For example, in processing a refund you will incur costs for:
- Staff time
- Checks and associated bank fees
- Paper and other supplies
These increased costs may exceed the benefit associated with requiring the up front payment of unsatisfied deductibles. When a physician accepts Medicare Part B assignment, Medicare Part B recommends:
“Since it is difficult to predict when deductible/coinsurance amounts will be applicable, it is recommended that providers do not collect the deductible prior to receiving payment from Medicare Part B because over-collection is considered program abuse. In addition, this practice can cause a portion of the provider’s check to be issued to the patients on assigned claims.”
Consider the following practice tips which may increase cash flow:
- Wait two or three weeks after the claims are submitted for the explanation of benefits to find out the exact amount of deductible owed by a patient.
- Don’t assume that the amount you determine at the time of service is the patient’s outstanding deductible as you may be surprised that the patient may have visited another provider or have some other medical charges submitted and applied to their deductible prior to the filing of your claim.
- Ask the patient about additional policies. The patient may have a secondary or supplemental insurance that covers the entire amount of deductible.
- Confirm the status of deductibles yourself. Most patients do not know what is covered under their plan and may give you inaccurate information.
- Contact the patient in advance and inform him or her of the amount due. If a patient is scheduled for an elective surgery, verify the patient’s benefits prior to the surgery. Obtain payment of the deductible balance or work out a financial arrangement for payment of the portion prior to performing the surgery.
- Make sure if you give discounts and/or write off amounts for financial hardships, that this practice is done across the board on a case-by-case basis. Do not make this a routine practice. Any fee reduction or write-off should be properly documented.
- Prevent scrutiny. You can be investigated for fraud if you do not bill for the deductible and/or coinsurance of a Medicare patient. You could lose your contractual arrangements with non-Medicare insurance carriers if you do not bill for the portion due from patients under their plans.
Do not bill the patient more than the fees allowed by Medicare or by non-Medicare carriers. There is no law that says how many times you must bill a patient before taking a reduction or write-off. So long as you can document that you have billed the patient, you should be safe in discounting or writing off a fee due to a genuine documented financial hardship.
By Delly Parham, AS, CPC
March 23rd, 2011
By Jill Young, CPC, CEDC, CIMC — East Lansing, MI
Are you aggravated by accounts with small balances as you work your receivables; those small balances that show up on your reports as co-pays that were not collected at the time of service? If your office doesn’t have a policy for collection of co-pays BEFORE the patient is seen, now is the time to start. The expense of statements and working accounts receivable to collect these balances is money that may not offset that $10 or $25 co-pay you’re chasing.
As an instructor, I polled my students during the past five years for their office policy. In that time, the percentage of offices collecting co-pays at the time of check-in has increased from about 15 percent when I started tracking to more than 75 percent in 2010. All agree it was a worthwhile change.
Today’s difficult economic times have left many patients with higher co-pays, deductibles, and even no insurance. Then, there are the Health Savings Accounts (HSAs), which present their own challenges to your collection process.
To ensure a successful transition to this new office policy, start three months prior. A letter to patients explaining your office’s new policy as you attempt to keep costs down in the current economic environment works to notify and prepare patients for the change. Also, posted notices and statement messages in the reception area can increase awareness for your patients. It’s best to only collect co-pays that are a set known amount (e.g., $10 or $25). The increase in front desk cash flow and the decrease in back office accounts receivable work will result in a net positive for any practice.
December 22nd, 2010
The Centers for Medicare & Medicaid Services (CMS) has set the Medicare premiums, deductibles, and coinsurance amounts to be paid by Medicare beneficiaries in 2011. For the most part, rates will stay the same for Part B services; whereas, beneficiaries requiring Part A services will see slight increases in both premiums and deductibles in the coming year.
November 12th, 2010