The Greatest Sleight of Hand: How High-Deductible Health Plans Shifted Unsecured Credit Risk to Practices
TL;DR: When insurance companies transitioned to HDHPs, they quietly shifted the financial burden and risks of collecting the first and last dollar to unsecured credit facilities—aka the patient. RevOps Health’s OpsRadar helps practices quantify and manage this risk, ensuring they collect what they’re owed.
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The Story Behind the Numbers
One practice owner shared a surprising yet all-too-common anecdote: they intentionally stop sending patient invoices in September and October every year. Why? “We can’t compete with the new iPhone launch,” they admitted. When faced with a choice between paying off their medical bills or upgrading to the latest smartphone, patients all too often choose the latter.
This might sound extreme, but it underscores a deeper issue. With the widespread adoption of high-deductible health plans (HDHPs), patients are responsible for paying more out-of-pocket costs than ever before. For providers, this means collecting directly from individuals rather than receiving secure, predictable payments from insurers.
At first glance, this change might seem like a minor adjustment. But for healthcare practices, it’s nothing short of an operational and financial disaster.
The Hidden Attack: A Shift in Credit Risk
Before the rise of HDHPs, a practice’s accounts receivable (AR) primarily sat with insurance companies—regulated, bonded institutions with deep pockets. While insurers aren’t perfect (as evidenced by delayed payments and disputes), they still represented a secure credit risk.
But with HDHPs, this balance shifted. Patients now shoulder a larger share of their medical expenses. As a result, practices must collect directly from individuals, effectively transforming themselves into lenders of unsecured credit.
Why does this matter?
Unsecured Risk: Unlike insurers, individual patients are not bonded or insured. They may lack the capacity to pay or simply choose not to prioritize their medical bills.
Increased Administrative Costs: Collecting from patients is far more resource-intensive. Practices must issue invoices, send reminders, and often rely on costly collection agencies for unpaid balances.
Unpredictable Revenue: A growing share of AR is tied up in balances that may never be collected, creating cash flow uncertainty.
One outpatient procedural specialty practice we spoke to described their frustration: "We knew something was wrong, but we couldn’t quite put our finger on it. Large payments were still coming in from insurers, but our bottom line wasn’t adding up."
The Cost of Patient Confusion
Adding to the problem is a fundamental disconnect: patients often don’t understand how healthcare billing works. For years, they assumed that having insurance meant they were “covered.” Many still don’t grasp the concept of deductibles, coinsurance, or out-of-pocket maximums.
But patient misunderstanding isn’t the only culprit. In one case we saw, the root issue also stemmed from a lack of training within the practice itself. Staff members weren’t fully equipped to address patient responsibility, leading to missed opportunities to collect balances at the point of care.
This highlights a critical truth: like any good investigator knows, you need facts and data to solve the case. You can’t fix what you can’t measure, and you can’t prioritize what you can’t quantify. Without a systematic approach to identifying and tracking patient payment patterns, the problem remained hidden in plain sight.
For one health system, the consequences of this blind spot became glaringly clear. They discovered that over $1 million in patient copays and deductibles went uncollected in just 12 months. Once they isolated the issue, they realized that a combination of patient education, better training, and targeted collections strategies was needed to regain control.
The Opportunity Hidden in the Chaos
While the shift to HDHPs has undeniably created challenges, it has also revealed opportunities. Practices that take proactive steps to address patient responsibility can turn these small balances into significant gains.
The key is visibility. By isolating and analyzing patterns in patient payments (or lack thereof), practices can take a data-driven approach to collections.
For example, the urgent care network mentioned earlier used RevOps Health’s OpsRadar to pinpoint exactly where their collections were falling short. The results were eye-opening: entire categories of patient responsibility—especially copays that should be collected at the time of service—were being neglected.
Once they identified the problem, they were able to put automated systems in place, recovering significant revenue while streamlining their processes.
The Big Picture: Taking Back Control
The transition to HDHPs was a financial sleight of hand, quietly shifting billions of dollars in unsecured credit risk from insurers to provider practices. Practices were left to shoulder the burden without warning, resulting in rising AR balances, strained operations, and frustrated patients.
But this doesn’t have to be the end of the story. By leveraging RevOps Health’s OpsRadar, practices can:
Quantify the problem: Identify exactly where patient balances are falling through the cracks.
Optimize collections: Target overdue accounts more effectively, saving time and resources.
Educate patients: Help them understand their financial responsibilities, reducing confusion and delays.
Ultimately, the key to surviving—and thriving—in this new era is taking a proactive approach. As one practice owner put it: “You can’t fix what you can’t see.”
Closing Thoughts
The rise of high-deductible health plans represents one of the biggest financial challenges practices have faced in decades. But it’s also an opportunity to rethink how you approach patient collections.
With RevOps Health’s OpsRadar, you can reclaim lost revenue, reduce administrative headaches, and build a more sustainable financial future.