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When a man found a surprise bill for more than $5,000 in his mailbox weeks after successful surgery, he did not have to wonder who to call and complain to. After all, he was on the hospital’s patient and family advisory committee.
The man was not shy about telling everyone how the unexpected bill made him feel. “He was very angry and felt we had not been truthful,” recalls Peggy Beley, director of patient financial clearance and bed management at Yale New Haven Health. The incident happened several years ago, when hospitals were first seeing a surge in high-deductible plans. Suddenly, patients who previously had paid small copays owed thousands of dollars. Many were surprised at their large balances even after insurance coverage paid its share. “That’s how it started for us. We decided to commit to transparency upfront, even if it’s hard,” Beley says.
Patients were finding out their costs too late. “We are the only industry where you go in blindfolded and don’t know how much it will cost,” Beley laments.
Hospital leaders knew their patients were unhappy with the way things were and decided to commit to price transparency. Leaders asked this important question: How do we educate our patients while securing payment for our organization?
Yale New Haven Health’s financial clearance department provides estimates for high-cost services at the health system’s five hospitals. “We have taken the approach of what I call ‘education estimates,’” Beley reports.
Financial counselors do more than give a dollar amount. Patients receive a good education on insurance terms and the “why” behind the amount. “We’ve found it beneficial to educate patients on the whole picture,” Beley says. In contrast, many departments send printed estimates without an explanation. Taking all this time to educate patients “is probably the path less travelled,” Beley offers. “But we believe it’s the right way to go.”
Talking to patients about insurance was brand new for some registrars. Most needed a fair amount of education themselves. “We needed to take a step backward and educate our staff on how insurance worked. It didn’t come naturally to everyone,” Beley recalls.
Previously, registration staff took insurance information, but that is where their involvement ended. Patients received a bill on the back end after services had been provided. With soaring out-of-pocket costs, this system no longer worked. The focus shifted to the front end, beginning with a small group of financial clearance specialists. “We built their confidence to the point where they can have these conversations,” Beley says.
Employees give patients a breakdown of what is covered, what is not covered, and how much is owed. “This has gotten extremely complex in recent years,” Beley says. “We took a layered approach to training.” Training starts with terminology (deductible, copay, coinsurance, total out-of-pocket costs, in network, and other insurance terms). Next, staff take benefit information from payer websites and apply it to particular services. Staff need more than a rudimentary understanding of it. “They have to be completely comfortable with the information in order to explain it to patients who are typically very confused,” Beley explains.
New employees shadow experienced financial clearance employees to learn how conversations unfold. Some cringed at the idea of talking about money because they hated math. After a while, says Beley, “they just rattle it off,” she says. “They take the time to educate the patient on the phone, just like we took the time to educate them.”
Some people avoided healthcare due to their high deductibles. With some financial education, they realize something can always be worked out.
“Probably the most rewarding thing is to help someone obtain access to care,” Beley shares. Patients are more satisfied and end up with less bad debt.
“Providing our staff expertise in insurance benefits is priceless,” Beley says. “It was a great investment.” For obvious reasons, accuracy in price estimates is critical. It hinges on the department obtaining correct insurance information from patients, the right CPT codes from the provider’s office, and appropriate benefit information from the payer.
“We’ve worked really hard at making sure our eligibility system is giving us back the latest and greatest results so we are using the most up-to-date information,” Beley says. Estimates can still change for these two reasons: other diagnostic tests or procedures performed (increasing out-of-pocket costs) or other recent services the patient had paid for are submitted to the insurance payer in the interim and applied to the deductible. This makes the amount owed less.
Staff explain that the estimate is based on whatever specific test or service is ordered currently. If the physician or the radiologist changes it, the cost also changes.
“We educate them on the whole process, not just their particular test or service,” Beley notes. There are many different variations of plans; not all are covered by the department’s estimate tool. Sometimes, staff scour payer websites to find out certain things. “You have to actually dig for the information. That’s something we struggle with. It’s time-consuming and challenging,” Beley says.
Every patient’s financial situation is somewhat different. This makes scripting of limited use. “Everyone comes in with a different set of worries on their mind,” Beley explains.
No one wants to hear they owe a lot of money. Most people come to realize that registration staff are sincerely trying to help.
“We’ve found patients are extremely grateful, even if the cost share is significant,” Beley reports.
Recently, the man who received the surprise surgery bill was scheduled for surgery again. This time, he had something very different to report to the patient and family advisory committee. He raved about an employee who called to explain in great detail what his insurance benefits would cover. She provided him an estimate of his out-of-pocket costs a week before the surgery, giving him a choice about how to proceed.
“Although he still owed money, this phone call made a huge difference to him,” Beley says.