Historically, price transparency in most retail markets is viewed as a benefit to the consumer, but not necessarily for the businesses selling products and services. A strategic lack of transparency might give an advantage to a used car dealer hoping to lighten the wallet of an unenlightened customer. But when it comes to today’s healthcare market, the opposite is true.
When providers don’t sufficiently explain and illuminate pricing, it can have a profoundly detrimental impact on their revenue and cash flow. That’s because a lack of clear patient understanding of their upfront costs and payment responsibilities is one of the leading causes of subsequent delinquencies and defaults. A proactive policy of informing and educating patients about pricing in advance, on the other hand, allows them to more conscientiously plan for repayment.
That can lead to significantly shorter collection cycles and healthier cash flow – two of the biggest problems that plague the majority of healthcare practices. Meanwhile, research confirms that the vast majority of consumers would consider changing healthcare providers, if it meant that they would have an improved payment experience. So the valuable added benefit of such an approach is that practices automatically develop more trusting, loyal, and sustainable relationships with their patients. It’s a financial prescription for success where everyone ultimately wins.
Now is the time to implement much-needed transparency policies, too. For years, patients have been demanding greater transparency, with more than 70 percent of them complaining that they cannot even decipher their medical bills. But recently they’ve joined forces with powerful allies, having gained the influential help of legislators. At least half of the states across the USA have already passed laws that require healthcare organizations to provide patients with tools to help them better comprehend and navigate pricing.
In August of 2018, the Centers for Medicare & Medicaid Services (CMS) also finalized rules that mandate pricing transparency. The CMS wants to see providers reduce paperwork and labor-intensive administrative tasks that can potentially distract from the core objective of delivering quality patient care. The new regulations include stipulations that hospitals must list their prices in digital format. Going digital eases administrative burdens, while it offers patients convenient 24/7 access to pricing via internet connected devices.
Fortunately, technology has evolved just in time to fuel a smart, affordable, and compliant transition – with tools that are user-friendly for both patients and administrative staff. There are innovative software systems, for example, that provide insightful, real-time cost estimators. They not only calculate an estimate of payment responsibility, but also automatically verify insurance eligibility and generate a handy fee schedule.
Before a patient even visits a provider, their credit card information is safely filed in the system for future payment. Upon payment, funds are transferred straight into the provider’s bank account, minimizing processing fees and potential delays. There is also the patient-oriented option of setting up a manageable and flexible payment plan. Because the payment data is securely archived in the cloud, it is accessible to authorized users from any mobile Wi-Fi device.
One of the most comprehensive price transparency tools is PaymentCare™, an all-inclusive revenue cycle management platform that incorporates both HIPAA compliant and PCI compliant technologies. It is the first healthcare processor to offer credit card data encryption and tokenization, and all payment types are accepted in a convenient but secure online patient portal.
Healthcare practices can also create in-depth reports, customized to their particular needs and preferences, and access those from the same centralized platform. The bottom line is that pricing transparency can go way beyond posting prices. With the right tools it can upgrade a healthcare practice in multifaceted ways that are positively transformational.