(3 min read) In recent years, the healthcare industry has seen a rise in high-deductible insurance plans. In 2020 47% of covered workers enrolled in a plan with a general annual deductible of $1,000 or more for single coverage — up from 17% in 2009, according to the Petersen-KFF Health System Tracker.ⁱ This rise in patient deductibles, out-of-pocket costs, and other patient cost sharing is a growing contributor to more bad debt on healthcare services providers’ books.

Best practices in maximizing healthcare reimbursement used to focus on revenue cycle management (RCM) teams working tirelessly to streamline their documentation and RCM processes to get claims out the door as fast as humanly possible. This process of expediting clean claim submission in this way is called “zero-day billing,” i.e., billing as close to the day on which the services were provided as possible. This practice was based on the premise that the first bills in the door of the insurer were most likely to get paid.

From “Zero-day" Billing to “Right-day” Billing

While prompt billing still makes sense for some payers, like Medicare and Medicaid, the era of zero-day billing for commercial health insurance plans is long gone. Today’s high-deductible health plans translate into a much longer wait each plan year for the patient’s annual deductible to be satisfied. In this environment, if you bill too promptly, you will find many of your claims will go unpaid by the payer and fall into the ever-expanding bucket of patient out-of-pocket costs. The goal today is “right-day billing.”

Payer mix plays a key role in the speed of billing. Payer mix describes the portion of revenue that comes from each main category of payer: Medicare, Medicaid, commercial insurance, and patient self-pay. For most healthcare providers, the highest rate of bad debt is associated with the self-pay category. This means that any time an unpaid balance falls into the self-pay category, you are less likely to receive full payment on balances owed.

Therefore, it’s in your best interest to prevent balances from ending up in the self-pay bucket — and make sure they’re covered under one of the “insured” buckets — to increase the probability of capturing maximum payment for services provided. To do so, you must become an expert at proactively monitoring patient deductibles and timing claim submission once deductible limits are met. Doing so makes it much more likely that the patient’s insurance will pay your claim.

Technology Automates Deductible Monitoring and Eases Administrative Burden

While deductible monitoring can be performed manually by checking with the individual payer or by utilizing clearinghouses to assist in this task, the most efficient approach is to use an integrated solution that automates, centralizes, and simplifies monitoring deductible status to maximize revenue and reduce bad debt. Automated deductible monitoring helps your organization capture more revenue without adding administrative burden to your billing department.

Deductible monitoring is an essential step for optimizing your accounts receivable (AR) without adding to your staff costs or headaches. Automated deductible monitoring tools make it possible to implement “right-day billing.” Technology solutions, such as ZOLL^® Billing for emergency medical services and ZOLL AR Boost^® for hospitals, physicians groups, and medical billing organizations, monitor accounts in the background. They provide real-time intelligence about a patient’s deductible fulfillment, submitting claims when the deductible is met. Using automated AR optimization technologies that include deductible monitoring saves valuable staff time and improves revenue collection.

Right-day billing also shifts the majority of the financial burden from the patient to the payer. Timing bills to go out after patients’ deductibles are met can improve billing efficiency, reduce cost, and significantly increase revenue. As an added advantage, right-day billing reduces financial pressure on the patient, which can positively impact their relationship with their healthcare provider and increase patient satisfaction.

Read More on Managing Self-pay Accounts:

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