The Growth Channel

All surprise, no party: How unexpected medical bills may drive away your patients

by Sherri Afshani and Emily Heuser

Amid rising drug costs, an ongoing opioid epidemic, and looming uncertainty over the future of Medicare, surprise medical bills emerge as one of patients' greatest concerns—and a key (dis)loyalty driver.

 

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Surprise medical bills are charges from an out-of-network provider that the patient didn't expect or choose during his or her episode of care. And because consumers have virtually no way of confirming whether their anesthesiologist, radiologist, or labs will be in-network, they can go through an entire episode of care and end up with a surprise bill. In fact, according to the Health Care Cost Institute, 1 in 7 patients has received a surprise medical bill, despite choosing an in-network provider at an in-network facility.

How patients respond to surprise medical bills

But what happens after patients receive an unexpected medical bill? To find out, researchers in a 2019 Health Affairs article analyzed how patients responded to surprise medical bills after undergoing elective procedures. They found patients who receive an unexpected medical bill from an out-of-network provider during an in-network procedure were significantly more likely to switch from their preferred care team for their next health care encounter.

For the study, the researchers focused on a cohort of nearly 64,000 women with exactly two childbirth experiences covered by employer-sponsored health insurance from 2007 to 2014. They found a 13% increase in the chance that a woman would switch providers for her second birth if she had received an unexpected out-of-network bill for her first delivery. Interestingly, the researchers found women who switched hospitals reduced their relative risk of receiving a second surprise medical bill by 56%.

These findings are among dozens highlighting the growing severity of surprise medical bills and their effects on consumer behavior. For patients, switching providers or facilities is increasingly the natural response to a surprise bill—even if it means patients must leave their established, preferred providers. In particular, key service lines such as primary care, OB-GYN, and orthopedics face the most risk of consumer disloyalty, as these lines are often a patient's first encounter with a health system and a key impression point for determining future care decisions.

What you can do

With ongoing bipartisan legislation at the state and federal levels to address this issue, surprise medical bills may soon be a concern of the past. But until there's consensus among payers and policymakers over the best remedy, help make the case within your organization for investing in price transparency solutions by factoring consumer (dis)loyalty into the equation.

 

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Take a closer look at women’s pregnancy care preferences

We found that 74% of surveyed mothers returned to the system where they delivered for care. Given the loyalty implications of appealing to and providing a positive experience for pregnant women, we identified five key pregnancy personas to consider in your growth and experience strategies.

Use this infographic to explore the care preferences of these five different patient segments.

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