Two or three times a year, I hear people say that it cost anywhere from $5 to $8 (I’ve even heard as high as $15) to send a patient statement in the mail. “When one considers the employee’s time, the envelope, the piece a paper and the postage” experts say, “it can cost upwards of $5 to send a statement.”
I wonder, where did these statement cost figures come from? I’ve never seen anything ever publish regarding this “cost” and why it is so high. Only rhetoric. Have you?
I also wonder if it is only the medical field that has these high cost or it is the same regardless of industry. I get a Comcast bill every month… are they spending 5 or 6 bucks for each one of my statements too?
Let’s say a practice sends out 450 statements a month at a cost of $5 dollars a piece. 450 x $5 = $2250 x 12 months = $27,000. If one sends out 1000 statements a month, which I’m sure a large practice can easily do, the cost can add up to $60,000 under the $5 cost assumption. If it really cost $10, then the figures double.
If the cost applies to all industries, imagine how much money it cost a credit card company or Comcast when one considers these companies send out millions of statements a month.
When experts mention the cost of statements, the intent is to encourage practices to collect co-payments and balances upfront because not doing so cost the practice money. I get that. Collecting upfront for as much as you can is good business.
But it seems to me that if it cost $5 or more to send out a statement, experts shouldn’t make the argument to collect copayments and patient balances upfront alone, but rather champion the fact that sending out statements is an expensive and unnecessary cost that medical practices ought not to bear.
In other words, if it really cost that much to send a statement, why isn’t there more emphasis on eliminating statements all together?
Whether it’s $27,000, $60,000 or more, that is a lot of money. Imagine if sending out statements is eliminated… how much would a medical practice save? A practice could easily hire 2 or 3 people for that kind of money and not even miss a beat.
Personally, I think the $5 and up figure is way too high. I find it hard to believe that sending out a paper statement cost nearly as much as buying, storing, managing, preparing, counseling and administering a vaccine.
But, I can’t be certain because I haven’t seen any empirical data. Nonetheless, if in fact it does cost that much, we should spend more energy in figuring out ways to eliminate statements all together (and enjoy significant savings) than to focus on merely reducing just a portion of a practice’s statements by collecting upfront.
What do you think? Or does this sound like something way out in left field? I’d love to hear your thoughts.