Disbursements

The Painful State Of Patient Reimbursements

U.S. patients were notoriously overburdened by healthcare costs even before pandemic-related job losses added new financial strains. These high costs and long reimbursement waits often lead cash-strapped consumers to skip critical treatments altogether. In the Faster Healthcare Payments Report, PYMNTS speaks with the National Patient Advocate Foundation and the Houston Health Advocacy to discuss how ‘back-to-card’ disbursements and reloadable debit cards can help improve patients’ experiences — and their financial well-being.

America's cash-strapped consumers are often burdened by the cost of healthcare, frequently struggling to make ends meet while paying for treatments. They may even be forced to forgo sufficient care when their funds dry up.

The COVID-19 pandemic has prompted the nation to focus its attention on the healthcare sector and consumers’ financial struggles, but high healthcare costs were an issue long before the outbreak hit. Patients need easy access to medicine and treatments for all manner of ailments, and money is all too often an issue.

Caitlin Donovan is the senior director of public relations for the National Patient Advocate Foundation and the Patient Advocate Foundation, organizations that advocate for patient-focused healthcare reforms and provide financial assistance to patients and caregivers. Minor costs can quickly become major barriers, Donovan told PYMNTS in a January interview, adding that even medical aid disbursements of as little as $5 can make a significant difference in patients’ lives.

“Three years ago, the average amount patients needed was about $23 per way to get [to their appointments],” she said. “[That] is less than two movie tickets, nowadays. For [how much it costs] two people to go to the movies, [some patients] out there are not getting their chemo treatments. It’s not large amounts of money that are keeping people from getting the care they need.”

Those tight financial situations make it all the more important for healthcare and insurance providers to rapidly disburse funds to patients. Consumers are sometimes forced to pay out-of-pocket for services, then wait weeks for their insurance companies to reimburse them. Hospitals are similarly slow to compensate those they have overcharged, and Donovan noted that these sluggish payments practices are not consequence-free.

“If something’s delaying [a payment], you’re delaying somebody from getting what they need and living the life they need,” she said.

PYMNTS caught up with two patient advocates who help consumers overcome challenges related to navigating billing, doctor selection and treatment plans, among other steps, to understand how business-to-consumer (B2C) reimbursement practices affect clients.

Insurance Reimbursements

Bonnie Sheeren, a board-certified patient advocate (BCPA) at Houston Health Advocacy, has worked with many patients whose behavioral health service providers do not accept insurance. Insurers also often reimburse consumers with paper checks, but behavioral health treatments are not one-time events. This means patients must find ways to afford regular sessions while awaiting compensation, sometimes shouldering monthly costs of $1,200 or more, she said.

Steven Corn, a BCPA at Los Angeles-based Metis Advocacy, said he has witnessed similar strains when insurance companies offered only paper checks.

“I know from my clients’ standpoints it’s very frustrating when [insurers] say, ‘We’re processing a check and it can take 10 to 15 business days, so let us know if you don’t get it,’” Corn said.

Checks can be confusing as well as slow, he added. Insurers sometimes send funds that patients are meant to pass on to their doctors, but which check is for what purpose is not always made clear.

Hospital Overbilling

Consumers face similar pains when seeking reimbursements for overpayments. These issues can occur for various reasons, such as hospitals overestimating how much treatments will cost. Patients are commonly overbilled in emergency situations, during hospitalizations or in other instances in which several treatments and services are administered in short succession, Sheeren explained. The costs of one treatment could easily top patients’ deductibles or out-of-pocket limits, but some hospital departments do not have visibility into such details, causing them to bill patients as if their deductibles had not been reached.

“Say you have [a] $1,000 deductible and you go to the [emergency room], have a CT scan, [get] the ER doctor fee, have lab work done … [all those charges] hit at once,” she said. “The deductible will likely be hit by one of those [bills alone], but each group doesn’t know about the other group, doesn’t know that the deductible has been hit and [the charge has] gone to co-insurance, so they [individually] will ask for their money.”

Consumers must then endure prolonged bureaucratic reimbursement approval processes followed by waits for paper checks to arrive by postal mail. Donovan noted that it can take patients months to be compensated for medical overpayments, and Sheeren said they are often not allowed to choose their repayment methods.

“If you take something to return to the store, they take your credit card and give you the credit, but I haven’t seen that [in healthcare],” Sheeren explained.

Pharmacy Assistance and Patient Support Programs

Reimbursements are not the only way patients receive healthcare-related funds; some receive financial assistance. Pharmaceutical manufacturers sometimes reduce expenses for eligible patients, Corn said, with aid administered as point-of-sale (POS) discounts, rather than as patient disbursements. These manufacturers give consumers codes that can be provided to pharmacists for reduced prices

Consumer support also comes from groups like the Patient Advocate Foundation, which offers financial aid. Donovan said the foundation pays for consumers’ medications by supplying recipients with pharmacy cards. It also helps insured patients afford copays by letting them choose between checks and electronic fund transfers (EFTs) and issues financial aid grants via checks. Organizations would be wise to offer payment approaches based on patients’ needs, Donovan said. Checks are less useful for homeless patients, for example, as many are unbanked and will thus have to endure check-cashing services and fees. Debit cards could prove helpful, Donovan noted, and some consumers even receive Social Security benefits via this method.

Healthcare providers and insurance companies often issue slow-moving checks, which can fall short of adequately serving patients who need faster support. Those left waiting for funds sometimes struggle to afford medical treatments, forcing them to do without and potentially suffer health consequences. Pharmaceutical companies are easing such pains with point-of-purchase support, and advocacy groups are demonstrating the value in giving patients more options to suit their circumstances.

The quicker B2C funds are disbursed, the faster patients can be treated. Improving the population’s medical outcomes relies on both ensuring high-quality healthcare services and effective, convenient methods of delivering financial assistance and owed money to consumers. Faster patient disbursements may thus be just what the doctor ordered.

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