Healthcare payment policy spotlight: The consumer is our customer

March 8, 2019 / By Private: Katie Christensen

According to the Commonwealth Fund, which ranks healthcare quality worldwide, the U.S. is a low performer for three dominant reasons:

• Lack of coverage;
• Administrative inefficiency and
• Underperforming primary care due in large part to care coordination issues

Lack of coverage has received substantial attention in recent years due to the Affordable Care Act and the debate over the individual mandate. Yet it is our inefficient, disparate processes that have created a healthcare environment which, as Walter Cronkite so succinctly stated, is not healthy, caring, nor a system.

Have we lived with our processes for so long that we have become desensitized?  Are we incapable of appreciating the inefficiency?  We point to it, and yet we live with it…and it is from that vantage point that disruption becomes inevitable.

Take a step back and consider the following true anecdote. A student goes to the emergency room with a valid insurance card. The facility claim is processed without incident but the patient’s insurance information is never transferred for generating the corresponding professional claim. The professional bill is generated as self-pay and sent to an incomplete dorm room address.

The student eventually receives a threatening phone call from a collector who demands payment in full for the charges. The student is not asked if they have insurance. The healthcare system indicates that they are not responsible for what they classify as “claims processing issues.” If this situation seems reasonable to you, take pause.

This scenario raises several questions for the industry:

1. Why are our healthcare systems so disparate that it requires a “system transfer” (with apparently manual intervention) to generate the second claim?
2. Ultimately, why are two claims necessary for one encounter in the first place? (I pay for all the services for my car when I take it to the shop, regardless of who does the work)
3. Why is the member considered liable by the healthcare system?
4. Why is it okay to threaten an individual who is considered a dependent, and specifically without asking if the student has any healthcare coverage?

Following the 2008 financial crisis, the Consumer Financial Protection Bureau was initially formed to govern consumer protection in the financial sector. In recent years, it has expanded its purview to include medical debt. The Federal Debt Collection Practices Act, passed in 1977, covers any debt which is acquired for personal, family or household purpose.

Frequently cited violations include:

1. Failing to verify medical debts and respond to requests for validation from the consumer as required by the FDCPA;
2. Misstating the amount of the unpaid medical debt as more than legally owed—even if inadvertent;
3. Attempting to collect unpaid medical bills that were disputed by the consumer while failing to provide the validation required by the FDCPA;
4. Sending debt verification notices that instruct debtors to direct questions regarding insurance filings with insurers, which could mislead debtors into believing that they should resolve debt collection issues by pursuing claims with insurers.

As we continue the journey into a consumer-focused healthcare economy driven largely by high-deductible plans, it is imperative that we not forget who our customers are and remain client-focused. Let’s keep the “care” in health care.

Katie Christensen is a healthcare consulting manager within the Population and Payment Solutions group of 3M Health Information Systems.