Self-Pay Patient Billing & Charge Disputes: Prevention & Resolution

The No Surprises Act, which went into effect on January 1, 2022, protects patients by minimizing unexpected medical bills. It requires providers to help patients understand their costs and payment responsibilities in advance and sets up a dispute process for billing disagreements. ‍

Providers cannot legally collect on patient accounts undergoing this dispute process. Therefore, it’s in everyone’s best interest to avoid disputes in the first place or move quickly through the process if necessary.

Financial discussions naturally come with complexities and sensitivities, especially in self-pay patient management. Providers must be proactive and develop policies and procedures in advance to maintain both legal compliance and patient satisfaction.

Fully Understand & Consider Laws & Regulations

First, providers must fully understand the intent and regulations associated with the No Surprises Act. The bill covers two categories of patients. The first category is individuals who present with coverage. These patients are protected from surprise medical bills that stem from:

• Emergency out-of-network care
• Non-emergency care from out-of-network providers at in-network facilities
• Air ambulance services from out-of-network providers 

The second category of patients, self-pay and uninsured, are guaranteed a good faith estimate of how much they will pay before receiving care.

Good Faith Estimate for Self-Pay Patients

A good faith estimate (GFE) is a statement of the expected charges a patient will be responsible for after receiving care. It states, in clear language, the procedure, the procedure code, and the likely out-of-pocket cost.

The No Surprises Act states that all providers must deliver the patient a GFE no later than three business days after the patient makes an appointment, provided the appointment is scheduled more than ten days in advance. If the appointment or service is scheduled with less than ten days to go, the provider has one business day to deliver a GFE.

Providers must deliver a GFE to self-pay or uninsured patients upon request, even if that patient does not have the service or appointment scheduled. GFEs can be sent on paper or electronically. Either way, the provider should keep records and track GFEs sent out. If a dispute arises, you have proof it was sent.

Patient-Provider Dispute Resolution

The Patient-Provider Dispute Resolution (PPDR) process is a component of the No Surprises Act. Self-pay and uninsured patients can file a dispute if they are billed more than $400 above the expected charges listed on their GFE.

Once the dispute is filed, mediation takes place through a third-party dispute resolution entity. This third party reviews the evidence and determines what the consumer and provider will pay. Providers must send the mediator (via a secure online portal):

• A copy of the original GFE received by the patient
• A copy of the bill sent to the patient
• Other supporting documents explaining why the estimate was incorrect 

Throughout this process, the patient’s account cannot be billed or sent to collection in any way, including late fees. If the provider attempts to collect on this account or even implies they intend to collect, they are subject to a U.S. Department of Health & Human Services (HHS) fine. 

Strategies for Handling Self-Pay Patient Payment Dispute

The No Surprises Act also mandates that providers cannot threaten or harass the patient in any way to start the dispute process - but this should go without saying. A negative or malicious response will only make things worse.

The best way to settle a dispute is to remain polite and professional. Even if you ultimately lose some revenue, you can still earn the patient’s satisfaction and regain their trust.

Provide a Quick & Empathetic Response

From the moment the dispute is filed, lead with good, old-fashioned customer service. Remember, this is the patient’s hard-earned money, and they may be in a challenging financial situation. 

The more stress the patient feels, the worse the situation and their interactions with hospital staff are unpleasant. For everyone’s sake, train staff to respond to disputes quickly and manage emotions appropriately.

Communicate Effectively with Your Patients

Clearly and transparently explain the process to the patient so they understand what to expect next. It’s in everyone’s best interest to settle the dispute as quickly as possible, and knowing what’s going on will help the patient move things forward. 

If they haven’t already, let them decide how they want to be contacted, whether by email, text, phone calls or patient portal secure messaging. Once they’ve been contacted, make sure their account doesn’t get lost in the workflow. Invest in software to keep track of accounts in dispute and follow up as needed via the appropriate channel. 

Investigate, Document, & Explain

Disputes can become an endless rabbit hole of chasing down documents, digging up GFEs, and contacting staff members to determine who signed off on what. During the dispute, providers should be able to find and provide adequate documentation and explanations as needed quickly.

Every process step should be documented appropriately in the patient's record from when the patient asks for GFE or books an appointment.

Without proper documentation and sign-off, accounts may be accidentally sent to collections or slip through the cracks. If things go awry during the dispute, patients can sue, and HHS can fine the hospital. Having self-pay patient guidelines is essential to avoid untracked and unmanaged decisions and workflows.

Offer Customizable & Flexible Payment Options

Once the third-party mediator determines how much of the patient's bill is eligible, it may still be out of their financial reach. After the dispute process, offering a customized payment plan helps earn the patient’s trust and satisfaction. Although hospitals can set predetermined qualifying balances, monthly payment amounts, and plan durations, staff should consider that each patient’s situation differs. Extra flexibility may be required. 

The hospital might need to offer a discount or additional incentives alongside the plan based on the patient's financial circumstances. This flexibility helps ensure payments are made over time, reducing the likelihood of sending the account to collections or writing off the balance.

How to Proactively Prevent Billing Disputes

Of course, the best way to navigate disputes is to prevent them from happening. An even better way is to leverage vendors or internal resources to advocate for patients and connect them to financial assistance programs. If they don’t end up as self-pay in the first place, the account won’t likely end up in dispute. 

Conduct Proper Insurance Discovery

Providers should identify self-pay patients as soon as possible, ideally at scheduling or registration. Hospitals can gather information in advance through a patient portal or mail-in forms for patients with scheduled appointments. However, patients are often categorized as self-pay after care is provided.

Reasons a patient may be categorized as self-pay, and valid insurance is unable to be billed include, but are not limited to:

• Patient did not know their insurance information.
• Patient provided incomplete information.
• Hospital staff made a typo when taking patient insurance information.

Once care has taken place and the self-pay patient has been billed, providers can employ an insurance discovery tool to identify sources of coverage. Insurance discovery involves conducting an exhaustive check to detect and verify coverage via Medicare, Medicaid and commercial payers. This easy, proactive first line of defense improves self-pay patient management..

Inform Patients of the Right to Receive a Good Faith Estimate

Providers must take steps to inform patients of their right to receive a GFE upon request, as per the No Surprises Act. This information can be delivered via a written notice, office signage, the hospital website, the patient portal, orally at check-in, or all of the above. 

GFEs should be built into the payment assessment pipeline. Hospitals should immediately mobilize to deliver a GFE if a patient schedules a service 20 days out and is marked as self-pay. Providers can also request information to screen patients for financial assistance programs or insurance discovery in the same delivery. In theory, both the GFE and this request for information can be delivered through the exact communication mechanism, like a text message or patient portal message.

Provide a Clear & Easy-To Understand Payment Policy for Patients

Payment problems and disputes usually arise because patients don't understand what's expected of them. The first step in collecting what your self-pay patients owe you is to have a formal, written payment policy. The purpose is to ensure everyone understands that it's ultimately the patient's responsibility (or guardian's or caregiver's) to pay for their services.

When a new patient makes an appointment, staff should outline the payment policy, including the rate for an initial visit. They should provide the patient with a copy before the visit (if possible), post copies around the office, and keep extras at the registration desk. 

This policy should include the patient’s right to a GFE, the amount they are responsible for when payment is due, and how it can be made. The patient should provide a signature stating they understand their responsibility. The provider should immediately file this document away.

Hire a Patient Advocate

Many practices are discovering the benefits of hiring a patient advocate. These staff members guide patients throughout their care journey, assisting with referrals, medication, and medical billing. They can also help connect patients with financial assistance programs and help them understand their GFEs. 

Patient advocates work wonders in enhancing patient satisfaction and helping to manage costs. If you can’t afford to make this a full-time position, even a part-time patient advocate can make a big difference in preventing future disputes.

Patient disputes may arise, but a proactive and prepared hospital finance team can easily comply with the No Surprises Act and improve self-pay patient management strategies. It just takes a bit of organization and the right tools.

Prevent patient disputes down the line with improved self-pay management tools today. Click here to learn more about Office Ally’s comprehensive screening and enrollment software, MAPS,.