Top five reasons to offer patients flexible payment options

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Consider a man who just fell off a ladder and broke several bones in his leg. He is brought to an emergency room by ambulance and encounters a series of tests, including X-rays and an MRI, to assess the extent of his injuries.

He is given pain medication, placed in a cast for three months and then endures six weeks of physical therapy to aid his recovery. He did not choose to be injured, yet in a matter of hours, he has accumulated significant out-of-pocket expenses. Like many Americans, he has limited savings and has already used up much of his access to credit. Now, he has the added burden of managing these unplanned expenses at a time that is already stressful and overwhelming.

Even when individuals are covered by government or commercial insurers, expenses can quickly pile up due to rising deductibles, co-insurance and uncovered services or medications. In 2015, the average individual out-of-pocket healthcare expenses were $2,383. However, almost 70 percent of patients had less than $1,000 in savings to pay for these expenses, potentially leaving huge gaps in financial coverage.i ii What's more, the average household with credit card debt will likely cost above the average to receive additional lines of credit. With high deductible plans and these financial pressures patients are even becoming hesitant to make routine physician appointments, causing their limited finances to become barriers to care.

As the patient's financial responsibility continues to grow, healthcare organizations need realistic, affordable payment options to offer their communities. This will not only help ease patients' financial burden, but will also help protect the organization's bottom line in the face of new healthcare consumerism.

Why Flexible Payment Options Are Key

In the last few decades, consumers have been conditioned to expect value and benefits from products and services in almost every industry. They also expect transparency and user-friendly tools to make spending easy to understand and seamless.

As more healthcare provider options become available, the industry is also becoming increasingly consumer-driven due to the many choices offered to patients. Thus, hospitals and other organizations must find ways to be more transparent, compassionate and seamless with transactions.

Extending uniform and nondiscriminatory flexible payment options to the community through a technology-enabled financial partner can help organizations transition to that consumer-focused model while helping them manage expenses. The top-five reasons for considering this approach include:
1. Patient satisfaction. A negative encounter on the financial side can significantly influence their overall satisfaction even if a patient has a positive clinical experience. By proactively working with patients to help determine their ability to pay and meaningfully help them manage their medical expenses, hospitals can ensure patients have the opportunity to pay rather than finding out during the billing cycle that they are unable to pay. This not only helps avoid collections services—which can be embarrassing to patients while impacting credit ratings—it helps improve the patient's financial experience and overall satisfaction levels.

2. Ease of use. Hospitals with technology-enabled financial service partners allow patients to sign up for flexible, interest or no-interest payment options they can afford--without a credit check--through online or automated channels. This allows patients to pick a path that is right for their budget at a time that is convenient for them while sparing any embarrassment or concern about their credit history.

3. Financial productivity. Historically, patients' out-of-pocket expenses have been relatively insignificant to a hospital's bottom line. However, they now represent about 11 percent of a hospital's payer mix on average—and will continuing growing.iii Most patients want to pay their bills. However, if hospitals do not help patients find ways to do that, they will be leaving significant dollars on the table. Offering flexible payment options to patients through a technology-enabled partner, hospitals can increase their chances of getting paid and collect more efficiently while showing compassion for the patient's unique situation.

4. Scalability. For hospitals that manage patient financing and related customer service calls internally, patients might wait extended periods of time for answers. Whereas partnering with a technology-enabled service provider can be an extension of their staff, offering the scalability to field calls in a timelier manner through a call center or automation. This allows internal staff to focus on more pressing issues, which can help boost overall productivity and morale.

5. Compliance. In addition to providing scalability, partnering with a technology-enabled financial service provider offers nondiscriminatory, uniform programs delivered to all communities served by the healthcare organization. Services like these also offer audit trails to monitor compliance and ensure facilities are not discriminating against patients or providing unfair benefits.

Break Down Financial Barriers to Care

In this time of shifting financial responsibility, it is important to remain focused on the patient as a consumer. While clinical care is paramount, hospital leaders are also focusing on providing more financial transparency to their communities, helping them stay competitive and focused on innovation.

However, just helping patients understand their financial responsibility is not enough to improve that experience. Due to common financial challenges, hospitals and healthcare organizations also need to find ways to proactively help patients bridge the gaps and finance their care when out-of-pocket expenses become out of reach.

Everyone deserves access to needed healthcare regardless of the cost, and we believe most people want to pay their bills. Through well designed, comprehensive patient financing programs, hospitals can protect their financial health while making care more accessible and affordable to patients.

Mark Spinner is president and CEO of AccessOne.

i Report on the Economic Well-Being of U.S. Households in 2015. May 2016. Retrieved from https://www.federalreserve.gov/2015-report-economic-well-being-us-households-201605.pdf
ii Williams S. Nearly 7 in 10 Americans have less than $1,000 in savings. USA Today. 9 Oct 2016. Retrieved from
https://www.usatoday.com/story/money/personalfinance/2016/10/09/savings-study/91083712/
iii National Health Expenditures 2015 Highlights. Centers for Medicare & Medicaid Services. Retrieved from https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

The views, opinions and positions expressed within these guest posts are those of the author alone and do not represent those of Becker's Hospital Review/Becker's Healthcare. The accuracy, completeness and validity of any statements made within this article are not guaranteed. We accept no liability for any errors, omissions or representations. The copyright of this content belongs to the author and any liability with regards to infringement of intellectual property rights remains with them.

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