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Patients May Receive Help with Medical Costs from Hosptials

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By Phil Cohen

Though far more patients have obtained insurance following the implementation of the ACA, many still have difficulty covering the high deductibles featured in their particular plans. Hospitals have come up with a few interesting solutions to help these patients, as well as those still without insurance.

Rising deductibles are causing hospitals to find creative ways to collect customer payments

Solution 1: Interest-free loans

Some hospitals in the upper Midwest have begun working with banks to offer patients interest-free loans for three- or five-year terms. Patients can qualify for these loans without a credit check as long as they have a balance of more than $300, or $7,000 to get a five-year term.

Patients at SSM Health Care facilities can sign up for these loans, issued through Commerce Bank, while still at the hospital – even if they have no demonstrated ability to pay. Once the loan is processed the bank handles invoices, payments, and collections efforts. SSM’s vice president of revenue management claims that with continually rising out-of-pocket costs, this type of solution has been a long time coming.

Other hospitals throughout the country are beginning to pick up this trend, which is expected to ultimately reduce participating hospitals’ bad debt.

Solution 2: Premium Assistance

A number of hospitals in Florida, Wisconsin, and New York have begun looking for ways to help low-income patients cover the balance of their monthly premiums, to the extent of using donated funds to pay their premiums directly.

By covering the gap, either by preventing lapses in coverage or simply paying an entire year in advance, hospitals hope to keep the insurance in place and thus receive payment for patient treatment in the event of an illness or injury. While insurers are required to give patients a 90-day grace period before canceling their policies, they are only required to cover the first 30 days of health care bills.

Hospitals are now required by law to display their pricing. The law, also known as the Inpatient Prospective Payment, states that hospitals are required to post a list of their standard pricing online and make electronic medical records more available to patients.

What do insurance companies think?

Insurance spokespeople have argued that hospitals should not get involved in paying for patient premiums because of their obvious interest and that by paying premiums for sick patients they will be creating a “less healthy risk pool” and ultimately drive up everyone’s premiums. Hospital group representatives counter that insurers already incorporate a portion of that risk into their rate calculations.

So far, there has not been a final response from the federal government on whether hospitals can directly pay patients’ premiums; until there is, these hospitals figure it is worth the risk.

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Phil Cohen

About the author

Philip Cohen is the founder and President of PRN Funding, LLC. PRN Funding is an extraordinarily focused niche player in healthcare funding. With years of…... Read More

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