What’s one action a health system can take to significantly improve its bottom line? Collect unpaid balances from patients for healthcare services (uncompensated care); by doing this, systems stand to curb one of their highest costs.
Sounds Simple right? It’s not! Hospitals focus on what they do best – provide exceptional service, superior treatment careand saving lives.However, a simple byproduct of doing business is that the hospital generates massive amounts of debt. While most patients pay for any costs incurred, some can’t and some won’t.
One of the main problems are that as high-deductible health plans are increasingly common, and insurance plans allow people to sign up for them without determining if the consumer can afford the out-of-pocket costs, health systems are experiencing considerable growth of uncompensated care.
Uncompensated care includes bad debt (balances that can’t be recovered) and charity care (healthcare provided for free or at reduced costs to low-income patients) for self-pay patients. Self-pay patients either don’t have health insurance or have a balance due that their insurance doesn’t cover (due to coinsurance, deductibles, or services their policy doesn’t cover).
For health systems, the economic implications of uncompensated care are significant.
Top 5 hospitals reporting the greatest bad debt:
- Orlando Regional Medical Center: $253,196,054
- Memorial Hermann Southwest Hospital: $197,766,466
- Prisma Health Richland Hospital: $183,453,703
- WakeMed Raleigh Campus: $179,272,214
- Christus Good Shepherd Medical Center – Marshall: $165,085,900
Fig 1: Data from Definitive Healthcare’s Hospitals & IDNs database. Bad debt data is from the January 2020 Medicare Cost Report from calendar year 2019
Health Systems Need a More Effective Way to Collect on Balances
Founded in 2016, WRB Capital is an asset management company that is turning around the financial fortune of healthcare establishments like hospitals, healthcare clinics and dental practices.We have created an innovative and revolutionary way for hospitals and clinics to manage uncompensated care. We will help them maximize returns, improve cashflow and extend the revenue cycle.
“In today’s world, particularly with the strain that the COVID-19 pandemic has put on healthcare systems around the world, managing financial risk is absolutely essential.
WRB’s founder, Mr. Bartmann has become a billionaire in his own right for his strategic impact on the consumer debt collection field and has been named National Entrepreneur of the Year two times by NASDAQ, USA Today, Merrill Lynch, Ernst & Young, Inc. Magazine and the Kaufmann Foundation.
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