Creating Better Cash Flow & Efficient Billing Processes in Healthcare

The healthcare services industry represents one of the largest and most complex industries in the U.S. with annual total costs approaching $2 trillion. Over the past decade, healthcare spending increased by 69% per patient. Administrative costs account for 31% of spending due to inefficiency in healthcare transactions, causing practices to lose millions of dollars every year because of mismanagement of the billing process. Problems in this process occur in two areas: collecting payment from the patient and verifying eligibility.

Today’s rising costs of healthcare have resulted in a greater number of patients paying more for their healthcare with higher deductibles, co-payments and co-insurance. As more responsibility is placed on the patient, a greater burden is placed on the medical practice to collect from the patient. For example, in one of today’s high deductible plans, a physician may submit a claim only to find out weeks later that it has been denied payment because it is the patient’s responsibility. When this happens, the practice is forced to act as bill collector and to track down payments from its patients. The practice is not only inconvenienced but also short-changed.

Patient responsibility denials are on the rise, and this type of denial will cost a practice more than any other type of denial because it occurs more frequently than any other. It takes 30 percent to 40 percent longer[1] to get paid and is attributable to most of the bad debt write-off today. Most practices are not managing their denials effectively and efficiently. They are losing revenue on money that could easily have been collected at the patient point of service.
Clearwave has taken these problems and solved them. It has developed a solution to simplify healthcare transactions and information exchange to collect payment at the point of service and to eliminate eligibility denials before they occur. This is the secret to creating better cash flow and to having an efficient billing process. Below are the ways in which Clearwave accomplishes this.

Clearwave updates and verifies each patient's insurance coverage/eligibility when he/she schedules the initial appointment and at check in. Failure to check patient insurance eligibility results often in medical billing errors, insurance coverage concerns and delays. Humana, one of the nation’s leading insurers, ranks insurance ineligibility as the number one reason for denial of claims. Additionally, PricewaterhouseCooper estimates that it costs the average provider approximately $9 for each patient seen, utilizing the traditional methods of manual data entry and phone communication to check and to verify eligibility[2]. If a provider sees thirty patients per day, using traditional methods to verify eligibility, only sixteen patients would be verified.[3] Forty-seven percent of the patients seen would not be verified.

With Clearwave’s technology, there are no more billing errors, insurance coverage concerns or delays because insurance eligibility is checked 100 percent of the time. Before patients are even seen by the doctor, Clearwave allows a practice to efficiently and effectively verify eligibility. This is done at a cost of only thirty-two cents per patient. The verification process takes less than fifteen seconds per patient, and 100 percent of the patients would be verified for the same cost it takes to verify one patient using traditional methods.

Clearwave collects patient’s payment responsibility at point of service. Through Clearwave’s kiosk solution, patients can pay at check in. Having the ability to verify eligibility makes this process simple because patients and providers understand their responsibility. If payment is not collected at the point of service, it costs between $9 to $16 to send monthly statements to patients. Not only are these expenses eliminated with Clearwave but also waiting on EOB’s, the time a practice staff spends sending out statements, delinquent letters, making delinquent phone calls, and processing bad-debt information. Utilizing this simple process will have an immediate impact on a practice’s cash flow and front desk collections.

Incorporate new collection processes into financial policy with Clearwave’s professional services. Clearwave helps practices to make sure their financial policies reflect the new payment collection process. Patients need to understand in advance what their policies are toward their payment responsibilities to alleviate any misunderstanding later.
Clearwave eliminates eligibility problems and determines the patients’ payment responsibilities in advance. Practices are able to avoid costly administrative fees to collect it later, increasing their cash flow and reducing denials that drain practice revenue and resources.


Underestimating the Patient

Patients’ ability to use the Clearwave kiosk application has turned out to be better than we originally expected. Clearwave’s usability target was that 70% of patients would be able to successfully use the kiosk application. To Clearwave’s surprise, that number is actually more than 90%, and due to “Returning User” functionality and patients becoming more comfortable with the system after each visit, the success rate continues to grow.

To add to this success rate in the future, insurance companies are introducing into the market track 3 magnetic stripe cards that contain the necessary information to create an eligibility check. These cards are compatible with Clearwave’s kiosk application.

Because a large percentage of patients can successfully use the Clearwave kiosk, there has been a dramatic improvement in patient flow, as well as huge time savings for the office staff. Offices that had 3 resources checking in patients are now down to 1 resource, allowing 2 resources to be reassigned. The wait time and patient flow issues at the front desk have been totally eliminated, because the office staff now controls the patient flow. The office staff can call up one patient at a time, thus providing the individual attention that all patients want, which ultimately improves the overall patient visit.

One important factor to solving patient flow issues is moving the kiosk away from the front desk. We have found that if the kiosk is too close to the front desk, the patients will rely on the office staff to help. However, if the patients are responsible and don’t have immediate access to help, they can indeed successfully check-in.

The concerns for all doctors’ offices that are looking at installing the Clearwave kiosk application include the following:

• Our patients are not smart enough to use the system.
• Our patients are going to be angry about this process.
• Our staff won’t be able to adapt to this process change.
• If one patient complains, the doctors will be very upset.

Well, the patients are definitely smart enough to use it, as we have seen with our 60,000 check-ins via the kiosk. Yes, some patients get angry, but the majority of patients are happy to simplify their check-in process. The office staff loves the fact that fewer patients are in line at the front desk, and doctors are now more focused on the bottom line; therefore, doctors don’t mind a short term process change for the patient that has a huge long term financial impact.

Everyday each of us experiences more and more self-service devices such as ATMs, pay at the pump gas, airport kiosk check-ins, and self check-out at the grocery store. The first time we used these devices they were intimidating; however, we quickly adapted to them, and now we are expecting to see new and better functionality. The doctors’ offices that install the Clearwave kiosk now ensure their patients and staff will be more accepting of new technology in the future.