Does your hospital know what happens when your bill goes to collections?

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By Lee Ann Liska

This article published recently in the The Atlantic points out that unexpected, large hospital bills can happen to anyone.  This caregiver was hounded by collectors, one even inviting them to connect on LinkedIn!  As healthcare administrators, we have a good understanding of our average reimbursement and collection rates, as a percentage of the gross, billed charges.  But do we really know what happens when the uncollected charges are turned over to collection agencies?  Are we aware when and if they are then turned over or “sold” to other debt buyers?  To me, poor treatment by collection agencies and debt buyers is still a reflection on the health system where the patient received their care.  Can health systems and doctors afford this type of reputational risk?

I turned to a colleague, a revenue cycle professional and expert - the best I’ve ever worked with in the business.  They provided a more balanced perspective:

There are two sides to this dilemma depending whether you are a patient or provider.  From the patient perspective, medical debt is increasing and in too many cases crippling, often leading to financial ruin, depression and shattered lives.  Statistics show the percent of total bankruptcy, because of medical debt, at over 50% and employers shifting costs through deductibles, now on average over $1,300 and growing, according to the Kaiser Foundation.  On top of that, healthcare spending as a percent of GDP is approaching 20%; an unsustainable trajectory.  Bottom line, patients and families are harmed by unaffordable medical debt and there is no solution in sight.

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