Want to avoid bad debt? One way to do that is to simply collect what you're owed as quickly and aggressively as possible--and that's what many hospitals are doing. Increasingly, hospitals are opting to collect co-pays and deductibles at the point of care or soon thereafter, hoping to stem rising tides of unpaid bills. They're determining how much to ask for, in many cases, by analyzing not only the patient's coverage but their personal financial situation as well. Vanderbilt University Medical Center, for example, has pumped up collections at patient discharge from $30,000 a month in 2004 to $300,000 a month, in part by asking for a $300 payment as patients leave its emergency department. Other hospitals are offering discounts to patients who pay on site, and smaller discounts to those who settle their portion of the bill within 30 days. Still others are using more of a "stick" approach, turning unpaid bills over to collections agencies much sooner than they had in the past. With the growth of high-deductible plans, which place very large bills on patients' shoulders, such strategies may move from smart cash flow management to survival tactics very quickly in coming years.
To learn more about this trend:
- read this article from The Tennessean