Transparency pays off for St. Luke’s Health

Modern Healthcare - - INNOVATIONS - By David Royse A ver­sion of this ar­ti­cle also ap­peared on Mod­ern Health­care’s Trans­for­ma­tion Hub. Read more at mod­ern­health­care.com/trans­for­ma­tion.

Tech startup iVinci Health didn’t set out to help pa­tients un­der­stand bills com­ing from St. Luke’s Health Sys­tem.

It set out to help St. Luke’s un­der­stand what bills were likely to get paid by pa­tients.

The two or­ga­ni­za­tions, both based in Boise, Idaho, started work­ing to­gether in 2013. IVinci founder Kent Ivanoff was sell­ing his ex­per­tise in pre­dict­ing who would pay how much and when.

It was an an­a­lyt­ics sys­tem based, in part, on what Ivanoff learned ear­lier in his ca­reer at credit card com­pany Cap­i­tal One Fi­nan­cial Corp.

“We started by build­ing a busi­ness tool to help hos­pi­tals un­der­stand pay­ment dy­nam­ics,” Ivanoff said.

What St. Luke’s quickly learned from the startup’s an­a­lyt­ics led iVinci to a whole new busi­ness and a new way of billing for the health sys­tem.

iVinci’s busi­ness in­tel­li­gence showed pa­tients wanted to go on­line and see their state­ment and pay their bill like they did with other ac­counts. It also showed they were more likely to pay if they could eas­ily set up an in­stall­ment pay­ment plan.

Trou­ble was, St. Luke’s didn’t have such a sys­tem. “We didn’t have a dig­i­tal plat­form,” said Michael Raw­dan, St. Luke’s se­nior direc­tor of rev­enue cy­cle. “IVinci said they thought they could cre­ate one.”

So iVinci built an on­line pay­ment por­tal called VisitPay.

Be­fore team­ing up with iVinci, St. Luke’s, like pretty much ev­ery other health sys­tem, didn’t know much about the link be­tween ease of pay­ment and its own bot­tom line. St. Luke’s learned it could save a lot on col­lec­tions by in­stalling a sys­tem for pay­ing bills that was eas­ier for the con­sumer.

“The poorer the ex­pe­ri­ence, the more ex­pen­sive it is for the or­ga­ni­za­tion—on the or­der of three to four times more ex­pen­sive—just the cost of ser­vic­ing the ac­count,” Raw­dan said.

The model for how iVinci built out the VisitPay sys­tem was col­lab­o­ra­tive, work­ing with St. Luke’s and al­low­ing the sys­tem to test what worked and what didn’t. IVinci also started work­ing with other provider clients to cus­tom­ize its core plat­form. The health sys­tems drove much of what went into the prod­uct based on their in­di­vid­ual needs.

That abil­ity to help de­sign what VisitPay would al­low pa­tients to do was a main sell­ing point for another client, Salt Lake City-based In­ter­moun­tain Health­care, said Todd Crag­head, vice pres­i­dent of rev­enue cy­cle at the sys­tem. “We pro­vided a fair amount of in­put, with the in­ten­tion that it would to­tally re­place our sys­tem.”

“It’s im­por­tant for a ven­dor to come with, ‘Here’s a shell of the plat­form, and here’s the func­tion­al­ity,’ ” St. Luke’s Raw­dan said. “They came to the ta­ble with a shell. We worked closely with them over a few months with pa­tient feed­back through fo­cus groups.”

Ivanoff said the fea­tures of the VisitPay sys­tem are mostly driven by clients, which in ad­di­tion to St. Luke’s and In­ter­moun­tain, in­clude Vir­ginia’s Inova Health and Wash­ing­ton state’s Mul­tiCare Health Sys­tem.

“The beauty of the tool is it pro­vides com­plete flex­i­bil­ity for the health sys­tem to de­sign how they want to work with the pa­tient,” Crag­head said. “The pa­tients can go in and say, ‘I can af­ford to pay X amount at X per month,’ and they can do that all on­line.”

For ex­am­ple, “One of the things health sys­tems have asked us to cre­ate is a ver­sion that can be used at point of ser­vice so health sys­tems can help con­sumers un­der­stand what they will owe and help ar­range fi­nanc­ing,” Ivanoff said.

Providers were ripe for the prod­uct be­cause few had con­sid­ered mak­ing billing and col­lec­tions eas­ier for pa­tients, he said. Most of their fo­cus was on big pay­ers such as Medi­care or pri­vate in­sur­ers.

But pas­sage of the Af­ford­able Care Act and trends in the pri­vate sec­tor have trig­gered a rush to high-de­ductible in­sur­ance plans. Ivanoff and his part­ners’ ini­tial bet that pa­tients would owe more has paid off for the firm. “Con­sumers are on the hook for more, and they don’t have a 21st cen­tury tool set for deal­ing with that,” Ivanoff said.

St. Luke’s says it has seen a 48% in­crease in pa­tient sat­is­fac­tion with the billing ex­pe­ri­ence, and a 70% in­crease in de­ductible and co-pay pay­ments since im­ple­ment­ing VisitPay.

“On tra­di­tional plat­forms the av­er­age bad­debt rate on those (ac­counts) is 20%; that’s a pretty ro­bust num­ber,” Ivanoff said. “Our bad­debt rate is 75% lower than that. And that’s with­out mak­ing col­lec­tion calls. If you give con­sumers transparency and con­trol they like it far bet­ter, and they pay far bet­ter.”

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