Rising Patient Deductibles Spell Trouble for Doctors


December 14, 2012


Health plan deductibles are rising, and patient self-pay of deductibles is typically difficult for doctors to collect, meaning that increasingly more doctors may lose money on patient deductibles. This is according to athenahealth, a Watertown, Massachusetts, company that provides cloud-based services for medical groups.

"Benefit plans are shifting to include higher deductibles," says Tricia Andriolo-Bull, Vice President of Payer Strategy at athenahealth. "There's more cost-shifting in co-pays and co-insurance. The higher deductibles are a good way for employers to keep premium rates down. But any increase in self-pay is bad for the physician because it's hard to collect."

Athenahealth examined over $10 billion in adjudicated claims paid by private insurers to over 33,000 providers, from 2009 to 2011 (See pdf, Published with permission from athenahealth). The providers, who used athenahealth's services, were from 48 states and practiced in a range of private and not-for-profit settings.

Deductibles as a percentage of contracted rate have risen by 47% in the Northeast from 2009 to 2011 and by 20% in the rest of the country. Deductibles as a percentage of contracted rate rose the most in South Dakota (18%), Wyoming (18%), Missouri (15%), and Oregon (15%).

"High-deductible health plans are just starting to take off," says Andriolo-Bull. High-deductible plans were initially a tough sell because deductibles either didn't exist or were very low, she noted. But now that deductibles are the norm, it's easier for companies to raise them.

However, it means that a larger share of doctors' income is based on self- pay, and the patient is responsible for the deductible amount and the co-pay.

"It's really difficult for the physician to collect self-pay if that amount is not collected at the time of service," says Andriolo-Bull. "Once the patient leaves the office, the likelihood of collecting it is small."

The deductible is particularly hard to collect because the deductible amount is often unknown. "It's easy for the physician to know what the co-pay is, but the deductibles are trickier, particularly at the beginning of every year," says Andriolo-Bull, when the deductibles start anew. "The physician typically doesn't have access to information on where the patient is on his/her deductible."

The increase in deductibles is highest in the Northeast because plans with deductibles are a newer development there. "The West, South, and Midwest have already had deductible plans in place but are picking up high-deductible plans."

How Does a Physician Insulate Himself Against Rising Deductibles?

"The physician's front office needs to have an absolutely strong workflow, certainly regarding the staff efforts to collect patient payment," says Andriolo-Bull. "Some doctors feel awful telling patients that they have to make a payment before they see them. But the front office has to have a process in place to make sure this amount gets paid."

Andriolo-Bull also noted that some claims-processing organizations can do real-time adjudication processing so that the doctor can know what the amount of the deductible is and what the patient's payment should be, at the time of payment. "Some health plans have information telling where the patient is on the deductible, so we can get that information and provide it to the physician so that the office can collect the right amount at the time of service," she says.

For physicians' offices that don't have access to real-time claims adjudication, the front desk could call the health plan the day before the patient's visit to find out where the patient is on the deductible.

"The front desk should check the patient's eligibility so that the physician can collect the full amount owed," she says.