Computer software, processes, algorithms and intelligence that forecast a settlement price and negative actions taken by providers against patients, with debts owed, based on specific variables
View Patent ↗An automated method for resolving a debtor's debt obligation to a creditor uses a rating algorithm that implements predictive analytics to determine an anticipated amount for which the creditor will settle the debt. A debt purchase amount to be offered to the Debtor to have a third-party entity fully assume the Debtor's debt obligation is calculated based on the anticipated amount for which the creditor will settle the debt and operating costs and profit margin of the third-party entity. An offer to the Debtor to have the third-party entity fully assume the Debtor's debt obligation for the debt purchase amount is generated and sent with a document indicating that the Debtor has agreed to transfer the Debtor's debt obligation to the third-party entity pursuant to the offer. The creditor is notified that the third-party entity has assumed responsibility for the Debtor's debt obligation and resolved the Debtor's debt obligation.
1. A computer-implemented method of resolving a Debtor's debt obligation to a creditor, wherein the creditor is a medical provider, an entity acting on behalf of the medical provider, or an owner of the Debtor's debt obligation, the method comprising:
receiving, by a processor, data relating to the Debtor's debt obligation from at least one of a medical bill, medical claim, or insurance statement of the Debtor, wherein the Debtor's debt obligation includes results from at least one of an insurance company's explanation of benefits, one or more medical bills, or one or more medical claims;
determining, by a rating algorithm implemented by the processor, an anticipated amount for which the creditor will settle the debt as a greater of a cost-to-charge ratio of the creditor or a percentage of a Medicare allowable amount for a medical debt owed by the Debtor, the rating algorithm using predictive analytics to determine the anticipated amount based on the data relating to the Debtor's debt obligation and historical settlement data of the creditor;
calculating, by the processor, a debt purchase amount to be offered to the Debtor to have a third-party entity fully assume the Debtor's debt obligation, the debt purchase amount being based on at least:
(i) the anticipated amount for which the creditor will settle the debt, and
(ii) operating costs of the third-party entity and profit margin for the third-party entity;
automatically electronically generating and sending, by the processor, a communication to the Debtor via a communications network, the communication including an offer to the Debtor to have the third-party entity fully assume the Debtor's debt obligation for the debt purchase amount;
automatically electronically generating and sending, by the processor, a document via the communications network to the third-party entity, the document indicating that the Debtor has agreed to transfer the Debtor's debt obligation to the third-party entity pursuant to terms of the offer; and
automatically electronically generating and sending, by the processor, a notification via the communications network to the creditor, the notification notifying the creditor that the third-party entity has assumed responsibility for the Debtor's debt obligation,
wherein the third-party entity resolves the Debtor's debt obligation to the creditor.
2. The method of claim 1 wherein determining the anticipated amount comprises performing a total experience rating analysis comprising determining an average historical debt reduction given by the creditor and determining an expected cost for the third-party entity to obtain a settlement with the creditor.
3. The method of claim 1 wherein determining the anticipated amount comprises performing a specific experience rating analysis comprising determining an experience rating comprising an historical debt reduction for a given dollar amount of debt and an adjustment for a delta dollar amount paid by the third-party entity.
4. The method of claim 1 wherein determining the anticipated amount comprises performing a direct match debt amount rating analysis comprising determining an historical reduction for a given dollar amount by the creditor.
5. The method of claim 1 wherein determining the anticipated amount comprises performing a global analysis comprising assigning a weighted value to each variable of the medical debt.
6. The method of claim 1 wherein determining the anticipated amount comprises performing an experience rating analysis based on historical collection activities by the creditor.
7. The method of claim 1 wherein determining the anticipated amount comprises identifying an average of historic discounts provided by the creditor in settlements plus an expected cost for the third-party entity to obtain a settlement with the creditor.
8. The method of claim 1 wherein determining the anticipated amount comprises identifying an average of historic settlement amounts paid to the creditor by at least one of the third-party entity or other entities.
9. The method of claim 1 wherein determining the anticipated amount comprises estimating the anticipated amount for which the creditor will settle the debt based on a charity care status of the Debtor relative to the medical debt.
10. The method of claim 1 wherein electronically generating and sending the communication to the Debtor which includes the offer to the Debtor to have the third-party entity fully assume the Debtor's debt obligation comprises including the offer in the communication when the amount of the offer is greater than the anticipated amount for which the creditor will settle the debt.
11. The method of claim 1 wherein electronically generating and sending the document comprises:
electronically entering an indication of the Debtor's acceptance of the offer into the processor; and
automatically generating, by the processor, the document, the document indicating that the Debtor's debt obligation is fully assumed by the third-party entity.
12. The method of claim 1 wherein the third-party entity is (i) a receiver entity of the Debtor's debt obligation which receives a novation of the Debtor's debt obligation, (ii) a guarantor of the Debtor's debt obligation, or (iii) a step-in entity of the Debtor's debt obligation.
13. The method of claim 1 wherein the data relating to the Debtor's debt obligation includes characteristics of the medical bills or billing statements including the Debtor's responsibility portion of the medical debt.
14. The method of claim 1 wherein determining the anticipated amount comprises applying characteristics of the creditor to the rating algorithm, the rating algorithm rating the creditor based on the creditor's historical willingness to settle debt.
15. The method of claim 1 wherein calculating the debt purchase amount comprises basing the offer on at least one of demographics and personal information about the Debtor.
16. The method of claim 1 wherein the Debtor's debt obligation includes a patient responsibility amount shown with or on an explanation of benefits communication or a medical claim denial letter.
17. The method of claim 1 wherein electronically generating and sending the communication to the Debtor which includes the offer to the Debtor to have the third-party entity fully assume the Debtor's debt obligation comprises including the communication to the Debtor with or on an explanation of benefits statement.
18. The method of claim 1 wherein the data relating to the Debtor's debt obligation comprises data from a credit bureau.
19. The method of claim 1 wherein the third-party entity is the Debtor's medical insurance company, payer, or health plan sponsor.
20. The method of claim 1 further comprising automatically checking for medical errors and billing errors in the data relating to the Debtor's debt obligation using the rating algorithm.
21. The method of claim 1 further comprising generating, by the processor, an explanation of benefits statement and sending the communication and the explanation of benefits statement to the Debtor including the offer to the Debtor to have the third-party entity fully assume the Debtor's debt obligation.