It’s that time of year again where everyone seems to want to tap into their internal Nostradamus and make predictions for the upcoming year.
Often these prognosticators are given to wild speculation, predicting the healthcare equivalent of a future filled with flying cars. But when it comes to healthcare finance, it’s important for the predictions to be grounded in reality.
For example, it would be easy to predict this is the year value care or fee-for-value (FFV) in all its iterations begins to replace fee-for-service (FFS) as the dominant payment system. But it’s unlikely to happen for one simple reason: the soup is only half cooked. Nearly everything in healthcare takes time. And while the alignment of incentives to deliver high quality care at optimized costs is continuously, yet gradually improving, FFS remains much easier to administer. Payments for value can be highly complex.
With that in mind, there are several healthcare finance sub-trends I believe will make a significant impact on healthcare in 2020.
Here are four:
1. Self-pay solutions and analytics will play a bigger role in the healthcare finance ecosystem.
According to the Centers for Disease Control and Prevention (CDC), more than 45% of Americans aged 18-64 who have employer-based insurance now have high-deductible health plans (HDHPs). That percentage is expected to continue to grow over the next few years, which means providers and payers will need to have an atomic level understanding of the financial aspects of their patient/guarantor portfolios.
They will also need to get really good really fast at understanding how to get patients to pay “an affordable” share of cost. Affordability, propensity, and ability to pay all require deep segmentation and analytics. That understanding will come through advanced analytics, powered by data science and machine learning, designed to find the “sweet spot” of optimal payment/liquidity. Equally important is offering patients payment options that are most convenient including Venmo, PayPal, and other mobile payment platforms.
Study after study indicates patients/guarantors want a clear, rational understanding of how much they owe and what options they have to pay it. The providers and payers who succeed will be the ones who can deliver clear and, dare I say, rational pricing in the eyes of the healthcare consumer/patient.
Providers and health plans must also understand as deductibles and coinsurance continue to go up, many patients are delaying or foregoing care due to the cost. That goes completely against the goals of value care, with its focus on long-term health outcomes.
Providers and payers will need analytics to determine how to help make healthcare affordable for all their populations. Providers in particular will need to develop payment plans that work and continue to make payment available simple and easy at the point of care/sale.
2. Denial Management will increasingly be driven by advanced analytics.
Denials are the bane, or supervillains, of healthcare providers’ existence. At any given time, as much as 40% of providers’ accounts receivable (A/R) portfolio is in some state of denial placing tremendous stress on full realization of net patient revenue. With more of a provider’s revenue already at-risk due to patient self-pay, it becomes more important than ever to avoid denials to the greatest extent possible. Especially given that only two-thirds of denials are recoverable but 90% are preventable.-Managed Healthcare Executive