Healthcare costs have been on the rise for years and are poised to skyrocket, according to new research. Continued inflation, an ongoing labor shortage, lower insurance payments, and higher costs for patients are exacerbating an already tenuous situation for providers.
To mitigate these rising prices, healthcare practices will need to find creative ways to lower costs wherever they can. Fortunately, technology can help.
Healthcare Costs Surge
Healthcare costs are expected to increase by 7% in 2024, according to a recent study by PwC.
Although inflation in the U.S. has fallen over the past year, it remains higher than it has been in many years. As providers continue to grapple with labor shortages, they will likely have to increase salaries to maintain staff, even as wages rise across the board. Healthcare providers will look to mitigate these expenses by seeking higher and more frequent reimbursement from insurance companies in contract negotiations. However, health plans have also taken a hit recently as prescription drug costs have surged.
All that is on top of the cost to patients, which has skyrocketed over the past decade. During the recent Becker’s Spine, Orthopedic, and Pain Management-driven Ambulatory Surgical Center conference, a top neurosurgeon noted that patients are buckling under the high cost of insurance. He reflected on his own experience with medical insurance, which has seen him paying thousands of dollars in deductibles for his family. “Who in America can afford that?” he asked. “Insurance is just gouging us.”
With the cost of care going up and insurance companies raising deductibles and copays, patients are more likely to put off care—particularly elective surgeries and other procedures that aren’t immediately necessary. That means less revenue for healthcare practices, ambulatory surgical centers, and other providers.
Getting costs under control can be challenging. The healthcare industry as a whole has been struggling with a labor shortage for years. Many providers have been forced to hire temporary staff, which typically cost more than permanent employees. Practices faced with staffing issues may want to turn to technology like Practice Management Bridge to alleviate some of the burden on the employees they have.
Additionally, Practice Management Bridge can also help a practice provide experience for patients who are struggling to pay for services. Tools like Patient Financing and Payment Plans provide patients with more convenient payment options so that they can focus on their care in the near term.
The neurosurgeon also advised Becker’s attendees to exercise better control over their supply chain and vendors. Working with a consultant who will go over every line of the budget can help ensure that there are no needless expenses. It’s also important that physicians are fully aware of the costs of their purchases. “Most doctors have no idea what anyone is charging or paying,” he said. “We need transparency to control costs. Physicians need to know how much they are spending.”
Streamlining the Insurance Payment Process
Finally, one of the best ways for healthcare practices to ensure steady revenue in this new paradigm is to streamline the insurance payment process. Typically, insurers pay claims by mailing large, bulk payments for many patients and procedures. The practice staff must then manually process the payment within the practice management system (PMS), determining which claims were paid and which were denied.
Rectangle Health has recently partnered with Zelis to enable faster insurance payments. Using Zelis, the insurer will be able to evaluate each claim and send payments to the provider via virtual credit cards. All claim payments will be automatically imported into the PMS, aligning to each patient. The value is clear; providers will receive payments faster and won’t have to manually type in which claims were paid and which ones weren’t. With healthcare costs increasing and practices being shorthanded, straight-through processing for insurance payments will be an invaluable service.
The full Rectangle Health/Zelis product is slated for a full launch in early 2024. Providers can learn more about it in a recent episode of the Modern Practice Podcast. Rectangle Health’s Technical Integrations Manager, Josh Cooper, provides further details on this exciting new offering.