U.S. hospitals, balking at paying the bill for millions of Americans who have high deductible plans under Obamacare, are toying with requiring patients to pay up front before their scheduled care and are also offering no interest loans.
According to a report, which cited interviews with more than two dozen hospitals, doctors, patients, lenders and healthcare experts, patients who are seeing hospitals charge them upfront fees are appreciative to know ahead of time.
David Muhs, chief financial officer for the Henry County Hospital, which provides a discount for early payment, said in the report that the upfront conversations result in some patients skipping care, others delaying it or opting for no interest loans available through the hospital.
While Obamacare opened health insurance up to 20 million Americans, many people in those plans and employer-sponsored ones are choosing high deductible insurance plans that have low monthly payments but high out-of-pocket costs if they need treatment. Even if Obamacare is dismantled, the high deductible plans will still be there, noted the report.
The trend to charge patients up front is expected to increase this year, because the unpaid bills are creating huge debt loads even for prestigious hospitals and medical centers, noted the report. Hospitals in the U.S. had close to $36 billion in uncompensated care costs in 2015.
One of the first hospitals to test charging up front or offering loans is Novant Health, based in North Carolina with 14 medical centers and hundreds of outpatient and physician facilities. When more employers started offering high deductible plans, its debt rise.
“To remain financially stable, we had to do something,” said April York, senior director of Patient Finance at Novant, in the report. The patient default rate declined to 12 percent from 32 percent after it started offering no interest loans through ClearBalance, she said. “Patients needed longer to pay. They needed a variety of options.”