A variety of factors—such as market competition, high deductible health plans, and lack of transparency from insurers—is driving more patients to pay for healthcare with cash, says Sean McSweeney, president of Apache Health, a medical billing company based in Santa Monica, Calif.
Cash pay creates its own set of problems that physician practices need to consider in order to maximize revenue and minimize hassles.
McSweeney breaks cash pay into two categories: actual cash, for patients who do not have health insurance, and “effective cash,” where a patient has a plan that doesn’t cover a service or a high deductible that effectively makes them cash pay.
McSweeney urges physicians not to wait until there are problems to solve with cash-pay patients, and instead put together a “comprehensive policy to take into account and plan for both of these situations in advance.”
Practices with cash-pay patients would do well to make prices for top services available to the patients as easily and transparently as possible, McSweeney suggests. “If patients see something posted on a wall, that might eliminate a lot of problems on the back end where patients are complaining ‘I had no idea it would be $1000 for that procedure,’” he says.
Dedicate staff to the issue
McSweeney says that many providers aren’t used to cash-pay patients. Since cash-pay presents issues that may be different from patients who pay with insurance, McSweeney also suggests designating a specific administrative person or team to cash-pay, or ensuring that practice management software has a tool to field the types of questions about price and payment options that come up in cash pay situations.
Often, cash-pay patients may find themselves paying out of pocket for procedures insurers don’t want to pay or deem experimental. “There’s such a massive variation in insurance plans now that you can no longer predict [a service or procedure] will be paid by a plan.”
McSweeney says his company is even seeing cases where some women’s health services are not being covered.
Maintain a database of procedures covered
Providers aren’t used to this new landscape where once-covered procedures may now no longer be covered, he says. “So more work needs to be done up front where providers maintain a database of which procedures are covered by which payers.” If it isn’t feasible to keep track of all procedures, he recommends keeping track of “the top 80 percent procedures for your top plans.”
Doing this, he says, will save time on the back end. “We see all the time where the provider’s chasing the patient after the fact once they realize the plan didn’t pay anything,” he says.
Be creative with payment options
One strategy that can be successful with cash-pay patients, or in situations where coverage is uncertain, is to take deposits from patients on lower cost services. For example, if the patient pays $50 of a potentially $125 service, “It’s not going to make or break the provider if they don’t get that.” Plus, if insurance covers the procedure, patients may get their deposits back. “A deposit is easier to get from a patient than paying all cash up front,” he says.
With more expensive procedures, such as MRIs, surgical procedures or lab tests, it’s important for the practice to be able to know in advance whether the payer is going to cover the service, which is where that payer database can come in handy.
Whether a practice handles billing internally or uses a billing company, it’s still necessary to have the ability to check eligibility in place, McSweeney says.
“The days of not checking that should be over for everyone on every single visit,” he says. “You don’t want to find yourself in a position where you didn’t ask the right question and suddenly find out you’re not going to get paid for something.”