Report: Patients' Health Costs Jumped 13% in 2015

Patients are feeling more of a squeeze when it comes to funding their healthcare, according to a new report.

TransUnion Healthcare on Tuesday released a report showing patient deductibles and out-of-pocket costs both increased by 13% between 2014 and 2015. The average deductible in 2015 hit $1,278. The average out-of-pocket cost was $3,470. The higher costs represent a shift in responsibility from insurers to patients, TransUnion said. That shift is taking a toll: the report found that 51% of Americans owed at least $1,000 in medical bills in the first quarter of 2016; 77% owed at least $500.

“It’s clear that patients are becoming the new payer — a major source for payments to hospitals at both the time of service and after procedures,” said Jonathan Wiik, principal for revenue cycle management at TransUnion Healthcare, in a press release. “As hospitals navigate this new era of patient payments, we expect to see them provide more financing options to help patients meet their financial obligations.”

Wiik said the changes are causing healthcare providers to become more proactive by informing patients of costs, discussing financing options, and seeking payment in advance of procedures.

The report found dermatology, orthopedics, and general surgery had the highest out-of-pocket costs for patients (in that order).

Meanwhile, patients have less revolving credit available to pay their bills, TransUnion found. For every $100 in medical bills, Americans had an average revolving credit availability of $1,720 in March. That’s down significantly from the $2,250 in credit per $100 in medical bills patients had available in March 2015.

“Our findings emphatically demonstrate that despite the advent of the Affordable Care Act, more patients are struggling to pay their healthcare costs,” said Gerry McCarthy, president of TransUnion Healthcare. “In fact, patient payment responsibility continues to rise even as they have less available credit to make their healthcare payments.”

McCarthy said many healthcare institutions are turning to technology to help them boost revenue and capture payments that might otherwise be lost. For example, TransUnion’s eScan insurance discovery product has helped the company’s clients recoup $1.2 billion in insurance payments in the past three years, money that might otherwise have been categorized as bad debt or charity care.

TransUnion unveiled the report at the Healthcare Financial Management Association’s 2016 National Institute in Las Vegas. A full copy of the report is available here.