While reports circulate about the costs of treating patients who contracted COVID-19 continue — most notably the Seattle man whose bill for a 62-day stay in the hospital led to a bill that was more than $1.1 million — the amount of medical debt owed by people across the country is expected to spike this year, [according to a new report](https://www.benefitspro.com/2020/05/06/expect-more-medical-bill-debt-in-the-wake-of-covid-19/).
The number of individuals who owed a healthcare debt has grown to 61% in 2020 from 44% in 2009, and the total amount of medical debt owed is expected to top $115 billion by the end of this year.
Couple that explosion in the amount of medical debt with hospitals and healthcare organizations facing a more dire financial situation and that yields a recipe for a serious situation for practices of all shapes and sizes and the need for a renewed emphasis on developing an effective collection operation.
Healthcare practices and hospitals need to start making preparations now, if they have not done so already, for the amount of their accounts receivable to grow significantly and should be making proactive changes to their processes in order to keep that total from becoming a severe drag on the business. The huge spike in the number of individuals who have lost their jobs will result in millions of individuals who either no longer have health insurance or who do not have the funds to pay out of pocket for their healthcare expenses.
Healthcare practices have lagged behind other industries in recent years in making the necessary investments in technology and face other issues, such as a “highly fragmented” third-party collection industry and a difficulty getting in touch with debtors, according to the report. The report makes a number of recommendations, such as providing up-front cost estimates to patients, providing price transparency tools, and offering more user-friendly payment and communication channels — like email and text messaging — as possible solutions to help address the coming shortfall.
More than half of patients are expected to tap into their retirement plans as a means of paying their medical bills, according to the report. Younger individuals — who are farther away from retirement — are the most likely generation to take that step. Also likely to continue growing in popularity are GoFundMe and crowdsourcing efforts, especially for patients with terminal illnesses or who have lost their jobs.
To help prepare for the coming wave of unpaid medical bills, healthcare practices might want to consider speaking with third-party collection agencies, who can provide guidance and support in this important area of their businesses. Information that is sure to be very useful down the line.
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