Could you save $3.5M with a patient financial navigation program?

Topics: Service Lines, Oncology, Capital Planning, Finance

Deirdre Fuller

St. Mary’s Health System in Michigan has saved $3.5 million and secured coverage for nearly 400 cancer patients over the past two years with its new financial navigation program. By understanding new provisions of the Affordable Care Act and educating staff about improving patient coverage, St. Mary’s is easing the financial burden on cancer patients and reducing its uncompensated care spending in the process.


Rising costs of cancer care hit patients and hospitals hard

In a 2010 survey commissioned by the American Cancer Society, 21% of people younger than 65 undergoing cancer treatment said they had used up all or most of their savings. Shockingly, another 19% reported that they or their family members had put off getting a recommended cancer test or treatment because of cost.

According to Bloomberg’s BGOV Barometer, hospitals’ uncompensated care in 2010 had risen to $39.3 billion, an 82 % increase since 2000. The American Hospital Association reports that uncompensated care, including charity and unpaid bills made up 5.8% of hospitals’ expenses last year.

With these statistics in mind, Dan Sherman from St. Mary’s Health Care in Michigan recently explained to us how St. Mary’s Financial Navigation Program helps cancer patients find optimal insurance coverage—and saved the hospital about $3.5 million over two years.


How does a financial navigation program help?

St. Mary’s Health Care in Grand Rapids is one hospital working to decrease the financial burden of cancer care for patients. The Financial Navigation Program, engineered by Dan Sherman, has secured coverage for almost 400 patients over the past two years.

In 2008, Mr. Sherman developed a pilot version of the program with the initial goal of saving $70,000 over six months. By the second month, he had met that goal and, by the fifth month, hospital leadership decided to make the program a permanent service offered to patients at The Lacks Cancer Center.

Traditionally, most financial counseling programs focus on charity care, patient assistance, drug replacement, and co-pay programs, which Mr. Sherman describes as “Band-Aids” that only temporarily stem health care costs for patients. In contrast, St. Mary’s Financial Navigation Program emphasizes obtaining or improving coverage for uninsured and underinsured patients. So, how was Mr. Sherman able to successfully design and implement this service both at St. Mary’s and at other sites nation-wide?


Understanding the provisions of the ACA

With the passage of the Affordable Care Act, patients with pre-existing conditions, such as cancer, became eligible for a number of new health plans. Mr. Sherman dedicated himself to understanding the coverage and supplemental plan options available for cancer patients.


Researching health plans in Michigan

Mr. Sherman spent an entire year researching health plans and supplemental coverage policies available to patients in Michigan. This included learning about Michigan’s health insurance regulations, how to improve coverage for Medicare beneficiaries, and when and how an individual can change health plans.


Educating hospital staff and physicians

Changing hospital culture was Mr. Sherman’s biggest challenge to successful implementation. Many staff and physicians find it easier to refer patients for charity care rather than referring them to the Financial Navigation Program. But with ongoing education, that is beginning to change.

Mr. Sherman found that it is critical to coordinate his team’s efforts with the patient’s care team to secure adequate health coverage. In some cases, there may be a delay before health coverage begins, followed by a request to delay treatment. However, Mr. Sherman stresses that the Financial Navigation Program never gets in the way of seeking optimal care for the patient.


Hiring the right person

The success of the Financial Navigation Program hinges on hiring an empathetic and trustworthy person who can identify suitable options for helping patients pay for their care, counsel patients and families, and work with them to secure financial support. Mr. Sherman describes the ideal candidate as someone with both a clinical and mental health background who also has an accountant’s understanding of health care finances.


Learn more

Interested in a consulting service designed to help other cancer centers implement the Financial Navigation Program? The navigation program requires one new hire and one participating institution has already seen savings of $1.2 million over the span of one year.

For more information, please contact:

Dan Sherman

The NaVectis Group

P.O. Box 185

Caledonia, MI 49316


More from the Oncology Roundtable

Oncology Roundtable members can join us at an upcoming session of the 2012-2013 national meeting to learn more about how the government, commercial payers, employers, and patients are managing the rising costs of cancer. Register now.

To learn more about how to support patients with need, Oncology Roundtable members can read our publication Addressing Patients’ Financial Obligations.