Reducing No Shows with Patient Incentives?

No shows are a problem. They not only interrupt patient care, they cost the healthcare industry millions of dollars each year. Have you calculated how much they are costing you? What tools have you tried to tackle the issue?

The Cost of No Shows

If you haven’t done the math to see how much no shows are costing your practice, you may be in for a surprise. Here is what a Schriever Air Force Base clinic found out when they investigated their no-show problem:

“The total cost of missed appointments in 2014 is estimated to be $197,000 in funds and resources, the statistics show. A single missed appointment costs between $100 to $200 due to wasted time, resources and manpower.” (1)

The numbers are even more frightening when looking at multi-physician offices:

“One clinic had 14,000 no-shows  in a single year that resulted in an estimated loss of over one million dollars.”(2)

If you are saying to yourself that your practice is not that big, therefore your problem is not that big, you are probably wrong. A small practice is precisely the type of business that doesn’t have the resources to afford a no-show problem.

Reducing No Shows using Patient Incentives

Patient incentives involve giving the patient a small cash discount in order to motivate them to keep their healthcare appointment. Although this tactic is not permitted by Medicare and some insurance companies, with the new wave of direct-pay doctors, patient incentives are on the rise. If you feel this might be a waste of money, you may want to keep an open mind.

In previous articles, we covered how to reduce no shows by using appointment reminders and by creating an iron-clad cancellation policy. Here is an example of how one clinic in Foster City, California, is effectively using these techniques alongside patient incentives. When a patient creates their first appointment with a doctor, they are informed that if they fail to cancel their appointment at least 24 hours in advance, they will be charged $75. One week before the appointment, the patient receives an appointment-reminder email. The day before the appointment, the patient receives an appointment-reminder call. After the appointment, as the patient is checking out, they receive a coupon good for a $25 discount. All the patient has to do to get $25 off their visit is to show up for their appointment on the scheduled date and time.

patient incentive coupon

According to the front-office staff, this approach has been VERY effective.

Up until now, financial incentives were more commonly used for motivating patients with chronic conditions such as addiction and diabetes to stick to their treatment plan. A study conducted by Rand Corporation and Cigna Health Care in 2009 looked specifically at whether a small financial incentive, in this case $15, would “motivate physician visits and reduce racial/ethnic disparities in hypertension (HTN).”(3) Although not necessarily a study of no-show incentives, this report did uncover some very promising results:

  • A one-time $15 patient financial incentive, along with educational materials sent to patients, increased visits for patients.
  • Patients who hadn’t seen a physician in over a year saw the biggest effect from the incentive.
  • Patients receiving payments made appointments more quickly – more saw their doctors within 3 months than those in the other groups.
  • Individuals with slightly elevated blood pressure at the start of the study demonstrated significant and sustainable reductions in systolic blood pressure over time.

The data available to date does not prove, unequivocally, that paid incentives work. However, businesses across many other industries have been using discount techniques for decades and finding that coupons and discounts highly motivate customers. Benefits may also go beyond reducing no shows. Unlike cancellation fees which punish the patient for bad behavior, patient incentives reward the patient for good behavior. This leaves the patient feeling happy… and a happy patient, is a returning patient as well as a referring patient.

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(1)

(2) Measuring the Cost of Patient No-Shows

(3) Martin, Laurie T., Joie Acosta, Teague Ruder, Matthias Schonlau and Allen Fremont. Patient Incentives to Motivate Doctor Visits and Reduce Hypertension Disparities. Santa Monica, CA: RAND Corporation, 2011.

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