With the COVID-19 pandemic still very much underway, the continued spike of cases continues to be felt by hospitals not just around the country, but across the entire world. In this unpredictable landscape, hospitals are spending more to treat COVID-19 patients while trying to maintain regular operations during the pandemic. As a result of many patients being hesitant to enter hospitals due to the fear of contracting COVID, hospitals have taken a significant toll. Here are a few more reasons causing the deficit.
Increasing Cost of Labor
The capacity of the entire healthcare system has been impacted heavily by the continued inflow of patients caused by various strains of the Coronavirus. It’s important to note that the current healthcare system wasn’t built to support such an influx of patients needing firsthand care. With the limited staff available to tend to the needs of the patients, hospitals have reported high cases of employee burnout and staff turnover while facing more difficulty filling vacancies. To compensate, 90 percent of hospitals have had to increase base salaries and offer bonuses to retain support staff and attract new staff members, resulting in high labor costs. This will likely continue to be the trend, with more healthcare organizations facing higher competition for a limited pool of workers.
Postponement of Elective Procedures
Hospitals are losing a significant percentage of their revenue stream due to the postponement or even cancellation of elective, non-urgent procedures, which are highly lucrative. With the surge of new COVID-19 cases, hospitals across the country have stopped doing such procedures as cosmetic and elective surgery in a bid to free up much-needed space for new patients. This also allows them to fulfill staffing and equipment needs. In other areas, the patients themselves have also elected to postpone such procedures to limit interactions in highly-contaminated areas.
Economic Stress on Patients Causing Inability to Pay Hospital Bills
The economic impact of the COVID-19 pandemic has been immense. Extended lockdowns have caused businesses to close, causing many to work limited hours or lose their job entirely. Lost income and insurance benefits caused many to forego treatment of any kind because of the inability to afford medical care. Even with economic relief packages released by the government, many are still left with enormous amounts of debt.
Underpaid and Denied Insurance Claims
Perhaps the biggest reason for lost hospital revenue stems from issues with insurance claims. Many of these insurance claims have been severely underpaid for years, predating the pandemic. Reports suggest that commercial insurance companies have underpaid medical claims by as much as 40 percent, causing hospitals to lose $262 billion in revenue annually. Today, some commercial insurance companies have developed a reputation for incorrectly denying coverage for insurance claims. But for many others, the issues stem from a breakdown in the claims process due to miscommunication and errors. These include misinterpretation of the claim, miscalculations, billing errors, insurance contract issues, and missing paperwork.
How to Recover Lost Revenue Due to COVID-19 With ERISA Law
According to reports, it is estimated that hospitals are losing as much as $323.1 billion in revenue due to COVID-19. It’s important to note that over 70% of commercial claims pertain to ERISA, and many stem from insurance companies not paying what they owe. And in many cases, escalated claims are settled for much less than what was owed. But hospitals can claim the full amount through the Employee Retirement Income Security Act (ERISA). The ERISA law gives hospitals the right to appeal any insurance claim and receive the total amount billed. Through ERISA, hospitals can recover as much as 60-70% of lost revenues.
Using a specialized and detailed process for ERISA appeals, Auraven offers a dedicated team to assist you and ensure a full and fair review. Our team of ERISA specialists takes care of 95% of the workload. Many hospitals will have existing managed care contracts with their insurance companies, which determine what their reimbursements will be. At Auraven, we strive to ensure that the expected reimbursements are paid accordingly, as it varies depending on the hospital. We ensure every bit of information remains safe and secure to guarantee maximum benefit reimbursement and revenue recovery due to zero paid/underpaid benefit claims. In addition to guiding you through the entire process, our team uses an innovative approach to win your ERISA appeal.
Call Auraven for assistance at 833.927.7325.
