Industry Challenged to Create More Patient-Friendly Medical Billing System

Furthering the goals of focusing on patients, coordinating health care delivery, and making health information more accessible, the U.S. Department of Health and Human Services (HHS) has launched a new challenge for stakeholders in health care—designing a better medical bill that is easier for patients to understand. The HHS press release regarding the challenge notes “[p]eople who use health care in the U.S. today can often receive bills from multiple hospitals, doctors, labs or specialists for the same episode of care that vary in content, presentation and use of health industry jargon. Because of this, it can be difficult for patients to understand what they owe, what their insurance plan covers, and whether the bills are correct or complete.”

HHS and AARP are sponsoring the initiative, A Bill You Can Understand, which invites stakeholders to submit designs for simpler medical bills. Winners will be spotlighted at the Health 2.0 Annual Fall Conference and online at the challenge website, and the winning designs will be used by several “pilot partner” health care organizations, including Geisinger Health System, University of Utah Health Care and Cambia Health Solutions. The pilot partner organizations also participate on the advisory panel involved in judging the entries. Awards will be granted to one winner for the best design that is “easiest to understand” and another award will be granted to the applicant that “designs the best transformational approach to improve the medical billing system, focusing on what the patient sees and does throughout the process.” The first award for new bill design is “all about incremental innovation: taking bills as they exist in the current system and improving them” while the second award for billing system recommendations is “about disruptive innovation: blowing the doors off the way things are done today and creating something completely new that improves the patient experience.” Each winner receives a $5,000 prize. Criteria explained on the challenge website include understandability, creativity, uniqueness, use of plain language and most appropriate use of information and data. Applicants are encouraged to involve patients in the design process.

A research report prepared by Mad*Pow, a design agency administering the challenge, provides challenge participants with insight into the problems they should seek to resolve with their design submissions. The report includes the results from interviews of six “pilot partner” health care organizations, other stakeholders, and patients, as well as an online survey of 355 patients. Common billing system problems identified in Mad*Pow’s research included understandability, the volume of communication patients receive regarding medical bills, timing of communication, terminology used, and the fact that “Patients don’t know what they don’t know.” With regard to communication, interviews and surveys revealed frustration due to: the number of explanations of benefits and multiple bills for the same episode of care; different statements from physician, lab and hospital for one visit; and inconsistencies between billing statements. For example, specifically with regard to lab services, the report cites a patient complaint about getting two separate bills for two parts of the same lab test and neither bill described the lab test. Desired bill components detailed in the report that relate to lab services included a need for a list of specific tests performed and their associated costs. Commonly cited desires were for more price transparency, plain language explanations of bills, and connecting charges to insurance information.

The challenge materials provided also include a patient journey map that details visually a health care experience relating to an adult’s skin cancer treatment, demonstrating the patient’s path through the health care delivery system from visiting the primary physician, biopsy, diagnostic lab services, and surgery. The hypothetical scenario depicted in the map “triggers six different billing streams involving claims and payments and bills between the Insurer, the Patient, PCP, Specialist Practice, Labs, Hospital system and a Third Party administering the Patient’s FSA/HRA accounts.”

Other resources provided to challenge participants include guidelines, checklists, regulatory information (such as IRS regulations setting forth notification requirements relevant to financial assistance policies), a summary of state law requirements for EOBs, and links to relevant state laws (e.g., Vermont, Ohio, and Wisconsin laws regarding medical bills), and a New York law addressing EOBs.

Submissions are due by Aug. 10, 2016, and winners will be announced in September. The submissions must include: 1) a “design brief” describing the submission and how it satisfies the challenge criteria, in fewer than 2,250 words; 2) a visual depiction of “what the patient sees”—including the bill, and other materials or tools available to the patient; 3) a three-minute or shorter video explaining how the submission meets challenge criteria; and 4) a journey map similar to the one discussed above demonstrating the changes to the billing process from the patient’s perspective.

Takeaway: Many labs have already recognized the need to improve communication with patients by designing user friendly test result reports. HHS is now looking for industry to make similar progress on medical billing reports and systems.