Patients coping with medical issues often face difficult financial decisions and, given their delicate situation, cannot keep track of all the medical bills and payment deadlines. Patients seeing numerous doctors and specialists see bills trickling in irregularly from different sources and find it difficult to keep track of what insurers have paid and what they still owe. Between high medical costs and the number of uninsured patients, the amount of unpaid bills is growing and medical practices with reduced staff are not able to keep up with medical debt collection.
Outstanding debt collections often result in selling unpaid bills to collection agencies, sometimes while the patient is still reviewing payment options. If the amount owed is too small, a collection company might not continue efforts to track down payment, although they would still report the unpaid balance to credit agencies. According to research carried out by the Federal Reserve board, more than half of all collection accounts on credit reports are for medical bills, many of which are for less than $250. Most consumers are unaware that such a small sum can have a tremendous effect on their credit scores and can remain on their credit report for up to seven years.
A surprising find by the Commonwealth Fund, a private foundation that sponsors healthcare research, shows that of the 30 million Americans contacted by collection agencies in 2010, about half of them believed they were wrongfully contacted. In many cases, these patients were contacted for reasons outside of their own control, such as incorrect claims filing or improper billing notification on the behalf of the provider.
Instead of spreading staff thin, healthcare professionals may choose to look for an alternate revenue cycle management solution to help prevent billing errors that cause patients extra stress.