As published in hfma, July 1, 2018
How do you help healthcare organizations?
Cedar powers a patient financial management platform that helps patients and healthcare organizations navigate the patient payment experience. Our product offers three distinct components:
- A personalized billing experience
- A clear, user-friendly consumer interface for patients
- An enterprise-level customer relationship management (CRM) software for healthcare organizations
We individualize patient billing using machine learning and data science to generate the optimal outreach strategy, payment plan, and preferred method of payment for every patient. After accessing our system on a favored electronic device, patients can review their bills, ask questions, chat with customer service representatives, and select custom payment plans. We also connect individuals with their healthcare providers through the latest consumer technology, such as live chat, to help address any billing questions 24/7.
Healthcare organizations use our enterprise software to manage patient engagement, view previous billing interactions, and monitor financial activity. Our solution optimizes each billing representative’s workflow and allows providers to track key metrics in real-time, such as collection rate, cost-to-collect, and time-to-collect.
Overall, we bring healthcare organizations into the 21st century, providing them with the patient engagement and analytics tools that other service-based industries have had for a while.
What are some of the biggest challenges you see affecting healthcare organizations?
In recent years, patients have become one of the largest sources of payment for healthcare organizations, following the government. This is a significant change from 10 to 20 years ago, when patient payment constituted about 1 percent of organizational revenue. Now, it’s between 11 to 12 percent for large healthcare organizations.a
Despite the growing importance of this revenue stream, providers fall short in effectively capturing patient monies. There is a common misconception that people don’t want to pay their healthcare bills and avoid the task. Research indicates that most patients are willing to pay—yet only 30 to 40 percent actually do.b What this means is that healthcare organizations have more of a process problem rather than a patient-willingness issue.
The friction between patients and providers around payment is getting progressively worse for several reasons. First, patients frequently struggle to understand their bills, and this causes some hesitation about making payments. Patients may choose to wait until they can get their questions answered before making a payment, delaying the process. It can be further confusing to patients when invoices come well after a care episode. It’s especially problematic when the patient starts to receive bills and EOB [estimate of benefits] statements back-to-back, causing misunderstandings and further frustration.
Unfortunately, few existing revenue cycle solutions are fully targeted toward resolving patient payment challenges. Most electronic medical record and clearinghouse vendors are focused on the provider-payer relationship. This leaves healthcare organizations to piece together processes for addressing patient billing and collections, and they often approach things manually, which is both inefficient and ineffective.
How do your product offerings address these needs?
As mentioned before, Cedar takes a three-pronged approach to improving patient financial operations. To start, we offer personalized billing. Some technologies rely simply on credit scores, which offer limited predictive value. Other solutions include predictive analytics in the form of traditional propensity-to-pay models. However, it’s more important to find out why the patient may not pay. There are a variety of factors that influence this decision. Perhaps the patient doesn’t have the money to pay all at once and is waiting until more funds are available. Or the individual might not understand the bill. The patient may have thought the insurance would cover the cost and is surprised to receive a statement. In all these cases, the problem ultimately ties back to poor communication.
To solve these issues, Cedar uses technology that other consumer companies—such as KAYAK, Amazon, and Instagram—use to personalize their outreach and improve communication. We identify variables that impact payment behavior and use machine-learning algorithms to adjust communication and payment options accordingly. Our system looks at internal and external data points to classify patients into clusters. We’ve tested various outreach strategies for different groups to pinpoint the ones that work best. For some patients, it may make sense to send a text message or email, while others may prefer a phone call or letter. We also target the ask: Some patients are requested to pay the entire amount while others are automatically offered a payment plan based on their demographics, payment history, and other factors. The bottom line is that Cedar reaches the customer using the right channel, at the right time, with the right message.
In terms of our user interface, we provide a white-label option so that patients never feel like they are leaving the healthcare organization to interact with a third party. This reduces the friction for patients throughout their payment journey, making it a seamless experience. We are committed to offering the latest technology, performing updates to our platform every day. Our goal is to make it as easy as possible for patients to understand their bills, set up payment plans, make payments, and give feedback.
The technology we deliver to providers gives them the ability to better communicate with patients and clearly see all the steps along the patient payment cycle. It was surprising to us when we started the company two years ago that a lot of hospital and health system leaders did not know their out-of-pocket collection rates or their times-to-collect. Moreover, they couldn’t break down this information by insurance, specialty, or location. Cedar offers all these functionalities, letting organizations drill down into the details and gauge performance.
What are some key considerations for healthcare leaders when choosing this type of product?
Before purchasing any type of patient financial management platform, you should check to see how happy the patients are who currently use it. Strong patient satisfaction with the payment process can point to a system that is working well. You also should look at the results healthcare organizations are getting regarding collection rates, time-to-collect, and cost-to-collect. Finally, check out the patient interface. Is it easy and intuitive for people to use? By applying the lens of the patient to assess how approachable the system is, you can make sure it promotes a positive and productive billing experience.
After our clients implement our system, they see a 35 percent increase in collections, on average, and a greater than 50 percent reduction in A/R days. At the same time, they achieve approximately a 95 percent patient satisfaction rate, with the majority of payments (67 percent) being made through digital means. Our chat feature is especially effective. More than 80 percent of patients pay after accessing this functionality. It drives payment across all age groups—our median age of patients who engage the chat feature is 52.
In addition to reviewing a vendor’s performance, you also want to be sure they are passionate about long-term innovation. Not only is there a lot of change in health care right now, but there also are always new developments in consumer technology. As such, it is important to connect with a company that is committed to and capable of remaining on the forefront of development.
As healthcare organizations incorporate use of your product into their day-to-day operations, what advice would you offer to help them best set themselves up for success?
Fundamentally, an organization needs to be ready to embrace change. Implementing a system like ours requires organizations to move beyond the way they’ve always done things. Note that it’s less about operational change, because the provider does not have to do much work to implement our system. It’s more about the desire to take a whole new approach, pushing the envelope and trying something that has never been done before.
Cedar provides a smarter way for hospitals, health systems, and medical groups to manage the patient payment ecosystem. Combining best-in-class technology and data science, Cedar delivers a modern technology solution that is proven to quickly increase collections and boost patient satisfaction by offering a personalized billing experience. To elevate your patient experience, visit cedar.com.