How to Circumvent Rising Healthcare Practice Costs to Fuel Profitability

By Chloe From Clearwave | June 26, 2024

Specialty practices are operating in an unprecedented time of rising healthcare costs. The cost of treating patients is increasing – PwC’s Health Research Institute estimates that medical costs will be up 7% this year. With MGMA reporting the average operating costs for practices surged by 12.5%. Elevated expenses, driven by inflation and increasing staff wages, are now the norm rather than the exception. 

High-growth specialty practices are ensuring profitability despite rising costs and revenue challenges by doubling down on driving fast collections. Here’s how you can get on their level! 

Back-End Billing Obstacles Most Likely to Cause Profit Loss

To understand the significant impact fast collections can have on your bottom line, see the back-end or post-service billing obstacles that you can work to avoid this year! Here are a few of the major challenges you may already be too familiar with: 

• Slow or non-payments – If a patient’s phone number and address are outdated in your system, your staff may not be able to get in touch after care is rendered. As a result, you’re facing an uphill battle, with those payments waiting for a long period of time in accounts receivable (AR) while you try to get in touch with the patient. When you can’t get ahold of them, your often practice loses out on payments altogether. 

• Patient propensity to pay – Even if a patient is aware of their financial responsibility, it doesn’t guarantee they’ll pay. Considering 45% of insured patients fail to pay their out-of-pocket bills and your probability of collecting after a patient leaves the office is 30%, rethinking your payment strategy is vital to maintaining steady revenue. 

• Cost of collections – Now more than ever it’s increasingly costly to collect co-pays and outstanding balances after the fact, as debt collection strategies fees are on the rise. 

• Inaccurate data entry – Poor data collection during patient registration and insurance verification can lead to stalls in the billing process down the line, including slower payments and higher claims rejection rates that increase your time in AR.

The picture we’re painting is that back-end collections often lead to write-offs, missed revenue and profit loss – and in today’s healthcare landscape, every penny counts. Stop these challenges before they occur with the right front-end processes. 

How to Ensure Collections with Point-of-Service Payments

High-growth practices are relying on digital point-of-service payment collection strategies to increase collections and speed up time-to-revenue, despite external financial challenges. Patients are willing to pay co-pays and past-due balances when prompted, you just have to build the right approach! For example, Clearwave is empowering customers to leverage smart patient check-in software and advanced payment capabilities through our partnership with InstaMed — all to drive nearly consistent co-pay and patient data collection.

Here are three key ways to increase upfront profits and reduce back-end billing challenges:

1. Improve data capture during registration: Considering 86% of mistakes made in the healthcare industry are administrative errors, removing the human element will be beneficial to your practice by driving cleaner data. You can do this by automating patient data capture and reconciliation through patient self-registration and pre-registration. When patients check in, they can update information themselves, which increases the likelihood that they will actually review and update their data. Whereas, when patients are asked similar questions, via staff interactions, they may not know what insurance, contact information or home address they have on file. In that scenario, patients may say their information hasn’t changed when in reality, it has. Down the line, your staff will face those challenges discussed above due to poor data. Self-registration puts a stop to messy data capture and instead increases the likelihood that a patient will notice incorrect information and update it. 

2. Proactively determine patient responsibility: In order to collect payment at the point-of-service, you need to know what every patient’s payment responsibility is ahead of time, so you can prompt those amounts for collection during registration. Inaccurate patient insurance verification is likely the biggest reason behind your inability to collect co-pays at check-in. When you can’t quickly determine how much a patient owes at check-in, and you don’t get paid prior to their visit, your staff will have no other choice than to chase down insurance payers and patients after their appointment — increasing time in AR for those payments. Poor insurance verification could also be the leading factor behind co-pay refunds and credits, those that take up your billing staff’s precious time…

By automating eligibility verification, staff can identify patient coverage and payment information ahead of time to ensure accurate payments are collected during patient registration. For example, Clearwave’s Patient Multi-Factor Eligibility™ platform allows practices to run fee-free eligibility checks up to seven times prior to a patient’s visit. This capability, combined with a real-time eligibility dashboard that provides a holistic view of patients’ coverage details, allows eligibility staff to review patient insurance details, see remaining deductibles, co-pays and plan types and fix errors that need to be resolved before appointments. Using this approach, practices can drive nearly 100% co-pay collection rates at check-in. 

3. Prompt payment collection at every check-in: Your front desk workers are not bill collectors, so avoid leaving collections up to them! In a crowded waiting room, they may not have enough time to collect payment. Inexperienced workers may feel too uncomfortable to ask for payment. Even tenured staff may occasionally forget. All of these scenarios result in missed payments and lost revenue. 

High-growth practices don’t leave opportunities for payments to become forgotten or second priority. They use patient check-in software to drive fast collections prior to patient exams. When patients check in via a personal device or a kiosk, the digital process will always prompt patients to make a payment – so you can collect before patients see their providers! Relying on technology to streamline payment collections makes registration simple, quick and private for every patient while driving revenue for your practice! 

Streamline Patient Collections & Leverage Advanced Payment Features

There’s no denying that rising patient care and operating costs are challenges your practice must face and deal with head on. With the right approach, you can offset any negative cost implications by focusing on what you do have control over; ensuring fast collections to fuel profitability.  Clearwave prompts patients to update their data and make payments when they self-register via a mobile device or a digital kiosk in the office.

Once a payment request is made at the point-of-service, InstaMed enables simple payment via smartphone, tablet, computer or kiosk. Simplifying the process even further, InstaMed’s technology enables our digital check-in solutions to capture patients’ consent to keep a card-on-file and use it for future transactions. No matter what payment method is selected, the process is done in minutes and without staff intervention! See how Clearwave and InstaMed can help you reduce time in AR and increase profits every day. 

Collections Are Within Your Control

Contact us today to find out how we can help you accelerate cash flow for your practice! To learn more about Clearwave’s partnership with InstaMed and how we’re transforming patient collections, check out our data sheet and recent blog, “Profitable Practices: Maximizing Point-of-Service Collections to Drive Revenue.”