Because of what’s going on with employer-provided healthcare coverage, hospitals are seeing their bad dept costs increasing.
The culprit: The increased use of high-deductible plans, which shift more health costs into workers’ pockets. The trouble is, those pockets aren’t very deep.
“We have definitely been hearing from members that they are seeing an increase in bad debt and even in charity care for people with high-deductible health plans,” says Caroline Steinberg, vice president for trends analysis at the American Hospital Association, speaking to Kaiser Health News. “A lot of these folks tend to not understand the structure of their benefits until they get to the hospital, and they’re not covered as thoroughly as they thought.”
In 2012, 19% of all employer-covered workers were enrolled in a high-deducible plan--more than double the rate of 2009, according to Kaiser. These plans can have deductibles as high as $5,000.
True, the Affordable Care Act promises to increase coverage and reduce uncompensated care. But with high-deductible plans, hospitals are seeing unpaid bills even for patients who are technically covered. Typically about a quarter of hospitals’ uncollectible accounts have been associated with patients who have some kind of insurance, Steinberg said. She was unable to say whether that has changed in recent years
What to do: As bad debt cuts more into profitability, hospitals will have to look elsewhere to maintain bottom lines. A recent book, 46 Healthcare Metrics to Boost Profitability: Charting 2013 Trends, contains an actionable and concise data set on 10 key programs to boost the bottom line.
Have you seen your bad debt grow? What are you doing to counter it?