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Three Strategies to Shrink Hospital Bad Debt

Three Strategies to Shrink Your Hospital’s Bad Debt

The healthcare landscape could be synonymous with change. Patients have seen an increase in the cost of out-pocket expenses with higher deductibles. This can leave hospitals or medical groups with increasing amounts of bad debt. To help reduce your risk of growing debt, here are three strategies to shrink hospital bad debt:

  1. Ask for Payment Up Front
    Before administering treatment, more hospitals are starting to seek payment, which is a shift from the way things have been done in the past. There are benefits to asking for this up-front, including patients who are more informed of their treatment plan and can make better-informed decisions. While the conversations can be challenging, it’s critical to discuss financial responsibility, for clarification and to reduce collections on the hospitals part.
     
  2. Take a Look at Financing Options
    Providing financing options can be a win-win for both a hospital and patient. Hospitals can partner with a financial institution to help manage the amounts patients owe. Working with a bank allows better cash flow for the hospital and provides patients with lower interest rates, making monthly payments more manageable.
     
  3. Update and Streamline A/R Processes
    A reason accounts could go into collections or debt goes unpaid is because of the lack of follow up when it comes to the accounts receivable process. Systems need to be timely and evaluate all accounts, including the “aged” accounts, which can be forgotten or overlooked, becoming part of the bad debt.

As the number of high-deductible policies continues to increase, it’s important you have financial policies in place that inform patients of their responsibility. Your staff should be properly trained on the accounts receivable process in order to prevent accounts from falling through the cracks. For more tips when it comes to eliminating bad debt or to learn how CBE can help, contact us today.

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