With all of the attention on healthcare transparency, it seems ironic that Americans are more and more confused about healthcare, specifically their insurance policies. This confusion is resulting in more Americans foregoing medical care because they aren’t sure what their plan covers. We probably all know someone who has avoided going to the doctor because of their insurance coverage, or lack thereof.
Recently, I found out that a family friend was sick for several months and losing weight drastically. She was in the process of changing jobs and insurance plans and waited to go to the doctor because she didn’t want to have a pre-existing condition that wouldn’t be covered by her new insurance plan. When she finally went, she was diagnosed with stage 4 pancreatic cancer. To say I was devastated by this news is an understatement. Not only did we have to deal with losing a great friend, we had to cope with the unacceptable reason why she avoided going to the doctor. Being misinformed about health insurance – and pre-existing conditions – may have cost her her life.
While that example is a bit extreme, unfortunately it’s a reality for many Americans. According to a new survey by Policygenius, more than one in four people (27.2%) said uncertainty over their coverage had led them to avoid treatment. People making higher incomes were less likely to avoid care, but even among respondents making at least $100,000, nearly 20% said they had skipped treatment. This is probably surprising for those of us that work in healthcare. But, as professionals who understand healthcare and insurance, we should feel compelled to educate our patients.
Not only do consumers not understand the law and what the Affordable Care Act (more commonly referred to as Obamacare) mandated for coverage, they don’t understand basic health insurance terms, like copay and deductible. The survey asked about 6 of the 10 covered health benefits and found that almost half of respondents said health insurance covered none of the listed benefits, including hospitalization and medical care. Policygenius has conducted this survey three years in a row. In 2018, 28% thought insurance plans were required to cover none of the benefits and in 2019, 44% held this incorrect belief. And, fewer than a third could accurately define copay, deductible and premium. Yikes!
The national spotlight on healthcare and all of the political debates is leading to a lot of false interpretations and misinformation. For example, many people believe that the insurance plans sold through the marketplace aren’t real plans and that they don’t cover things that employer plans cover. However, while plans differ in how costs are shared, employer plans and marketplace plans must cover the same essential benefits.
The shift in insurance costs from employers to consumers is also contributing to the confusion. Twenty years ago, no one cared what healthcare costed because insurance just covered it. This is just not the case anymore and consumers are responsible for more of their healthcare costs each year. According to a study by the Kaiser Family Foundation, over the past five years, employee contribution to insurance premiums increased 15% for single coverage and 25% for family coverage, and the average deductible increased 36%. Meanwhile, wages increased 14% over the same period, researchers said.
Echoing the trend across the employer market, small businesses’ health plans saw significant deductible increases in 2018 from the year prior, according to a new eHealth survey of 184 businesses with fewer than 30 employees. The average individual deductible increased by 14% in 2018 (and by 24% since 2015).
Resources for Providers
It’s in the best interest of providers to educate their patients considering these stats from MedData:
- 68% of patients failed to fully pay off medical bill balances in 2016, up from 53 percent in 2015, and 49 percent in 2014. This number is expected to climb to 95% by 2020.
- It costs four times more to collect from a patient than it does from an insurance company.
- 92% of consumers want to know payment responsibility prior to a provider visit.
- 74% of consumers are confused by Explanation of Benefits (EOBs) and medical bills.
- 73% of providers report that it takes one month or longer to collect from patients.
The bottom line – patients are more likely to pay their bill if they know how much a service costs before the procedure.
In an effort to help you educate your patients, we created a healthcare definition glossary and a sample EOB that you can distribute to your patients or post in the waiting area for patients to view.
Policygenius also has a resource center that is packed with helpful information for consumers. It could be helpful to include this link on patients’ visit summaries, bills, or other patient documents.
Ken Magness is a focused healthcare professional with more than a decade of experience in helping clients understand the true value of automation in the revenue cycle management process. As the Strategic Initiatives Leader at Quadax, Ken and his team are passionate about connecting with healthcare providers to help them create and leverage the appropriate technology solutions to optimize the revenue cycle process and improve the experience of their patients and staff.