Hospitals are getting more practice about debt collection as borrowers have less and less disposable income to cover the costs of medical expenses, according to a published report.
TransUnion recently revealed that individuals had $1,720 in available revolving debt to cover every $100 in medical costs, down from $2,250 last year. Nearly 80% of patients owed more than $500 in healthcare debts, and 51% owed more than $1,000.
“It’s clear that patients are becoming the new payer — a major source for payments to hospitals at both the time of service and after procedures,” said Jonathan Wiik, principal for revenue cycle management at TransUnion Healthcare. “As hospitals navigate this new era of patient payments, we expect to see them provide more financing options to help patients meet their financial obligations. Healthcare providers also will evaluate resources, such as a patient’s propensity to pay, and engage with patients much earlier regarding financial discussions to ensure the patient is well educated to the cost of their care. This will help the patient keep their focus on getting better versus the worry about paying a large bill.”
Individuals are also facing higher out-of-pocket expenses for their medical and healthcare needs. Between 2014 and 2015, the average deductible and out-of-pocket maximum cost for individuals increased 13%, according to TransUnion.
Some healthcare providers have taken a hard-line approach to individuals who can not pay their medical expenses, and are using the legal system to obtain judgments and other court victories to force individuals to pay their bills. Others are using alternative means, like charity care, to help individuals defray their medical expenses.
Both presidential candidates have also issued plans to try and combat the rising costs of healthcare.