The best time I ever had as a hospital CEO was when I worked for a board at a 90-bed regional hospital. They believed in my vision of turning operations around by reinventing the patient experience. In less than two years, my team and I reversed patient leakage, achieved unprecedented patient safety and broke records for financial performance. For our work, in 2009, HealthLeaders Media named us the Top Leadership Team in Healthcare for Mid-Sized Hospitals. The lesson I learned is that when you take good care of patients, the bottom line takes care of itself. Part of this involves supporting patient financial literacy or educating patients about their healthcare expenses.
Why Patient Financial Literacy is Linked to Safety & Quality
According to a 2016 Harris Poll, people are twice as uncomfortable purchasing healthcare as buying technology. This got me thinking about the link between patient financial literacy and the metrics significant to hospital leaders. A 2007 Joint Commission white paper noted that:
“Effective communication is a cornerstone of patient safety. The Joint Commission’s accreditation standards underscore the fundamental right and the need for patients to receive information – both orally and written – about their care in a way in which they can understand this information. Further, accredited organizations are explicitly encouraged to ensure patient understanding.”
We know that cost concerns are an issue for patients. However, confusion is also a major issue for patients. Patientco’s 2021 State of the Patient Financial Experience Report offers insight as to why.
- More than half of patients have struggled to understand what their health insurance covered and what they owe out-of-pocket after receiving a medical bill.
- 8 in 10 providers rely on financial counselors to communicate with patients and discuss their financial responsibility, a process that is time-consuming and resource-intensive.
- Nearly two-thirds of patients report that their explanation of benefits (EOB) made little sense, took a long time to get, or they didn’t know what to do with the information.
If financial counselors and traditional EOBs don’t solve the patient financial literacy problem, what will?
What it Takes to Solve for Patient Financial Literacy
Helping patients understand their healthcare expenses doesn’t have to be painful. Improving patient financial literacy simply requires a different approach.
Give patients the right information at the right time.
When patients receive an EOB without a bill to compare it to, it’s hard to understand how the information applies to them. Instead, present relevant EOB details and insurance information side-by-side within the bill pay experience to help patients truly understand their healthcare bills. Patientco offers clear definitions of medical terms. They also use intuitive visuals that explain how the math works and breaks down the patient’s bill balance. As a result, patients more easily comprehend their health benefits, their insurer’s contribution and their remaining out-of-pocket cost. This helps improve patient financial literacy in a truly meaningful way.
Provide clear next steps.
Explain how patients can take action to ensure they feel understood and in control. Give clear instructions on ways to pay, who to contact and how, if needed. If a patient has a question, let them know whether they should contact their insurer or their provider. Or if a new document is needed to process a claim, such as an updated insurance card, give the patient instructions on how to submit the new card. By supporting patient financial literacy and ensuring patients have clear calls-to-action, patients are less likely to call the business office with questions.
Offer more visibility for business office teams.
For patients that prefer to speak with someone, team members need the right information at their fingertips in order to offer assistance. Patientco integrates EOB data into existing workflows. The platform only presents the most relevant data and filters out any 835 data that is not useful. This gives team members full visibility into what the patient sees. This eliminates the need to manually download EOBs from an insurer’s site.
Don’t Ignore the Implications to Health Outcomes
Patient financial literacy is a vital element of a patient’s overall care. In fact, nearly half of providers agree that improved patient financial literacy would improve population health goals because of fewer delayed visits, according to Patientco’s 2021 State of the Patient Financial Experience Report. When patients struggle to understand their medical bills, insurance benefits and how out-of-pocket costs are calculated, no one wins. It’s in everyone’s best interests to improve patient financial literacy in a way that’s scalable, intuitive, interactive and personalized.
Meet the Author: John W. Mitchell’s job titles have ranged from sailor in the U.S. Navy (broadcast-journalist aboard an aircraft carrier) to COO and CEO for several hospitals. In 2009, HealthLeaders Media named John and his senior executive team the Top Leadership Team in Healthcare for turning around a 90-bed, regional Washington hospital. In 2012, he started his own business, SnowPack Public Relations. John is widely published as a freelance reporter and writer in the hospital, healthcare, and medical sectors. More recently, his projects include writing content on behalf of Patientco. John is also the author of the novel Medical Necessity (four stars on Amazon), and a commercially successful landscape and wildlife photographer.