“Oh, you have no idea,” she said, with more than a touch of frustration. “The time we spend trying to match up payments with deposits is crazy. Different credit card transactions hit on different days, checks get cashed at different times and trying to match it all up for accurate reporting is difficult.”
In fact, this director’s experience is all too common. While almost every other industry, especially retail, uses cutting edge payment technology to improve customer experience and maximize revenues, that’s not yet true throughout much of healthcare.
That said, with upwards of 33 percent of hospital revenues now coming directly from patients—and climbing—it’s in hospitals’ best interest to improve their payment platforms with an eye toward making them more patient-centric and data-driven.
The good news is that hospitals can take this cue from other industries to tie data and dollars together. Doing so will dramatically improve their patients’ experience and their own bottom line in the process.
First, a little background
Historically, patients received treatment and the insurance company picked up the majority of the tab. Direct patient payments comprised a relatively small percentage of hospital revenues, and at such low volumes, they were relatively easy to manage.
Now that more patients are shouldering a larger portion of their healthcare costs, and hospitals are required to manage patient payments more effectively than before, things are quickly changing. Hospitals will be forced to rely more on consumer-driven payment models to succeed, rather than solely on payer-driven models they’ve used previously.
Why are patient payments harder? Because patients pay their bills in any number of ways—cash, check and credit card, to name a few. They also make their payments in any number of places—at the point-of service, online, via mail, telephone, all at once or spread over time with a payment plan. Whereas payers traditionally issue payments by cutting relatively few monthly checks at larger amounts, patient payments arrive in far greater volumes, but in smaller amounts creating more reconciliation work. Additionally, payments in healthcare must be associated with a specific patient and episode of care, which adds a unique layer of challenges to healthcare payments. All of the data and dollars must flow seamlessly to all the right places while remaining HIPAA and PCI compliant.
Often large numbers of hospital business staff are then tasked with manually processing, reconciling and posting each payment. Throw in chargebacks and credit card disputes, and accepting payments from multiple locations, and even exception processing for checks that are written out with notes or perhaps incorrectly, and it’s no wonder many organizations are looking for a better way to do this, for both themselves and their patients.
Taking a cue from other industries
Thankfully, there is a better way. Leveraging a consolidated patient payment platform, hospitals can automate virtually every aspect of payment collection, processing and posting while creating a positive consumer payment experience. The retail industry has been taking this approach for many years. If healthcare follows this path, it can vastly improve the patient experience while dramatically increasing payments and reducing collection costs.
Take Amazon, for example. The typical consumer using Amazon might buy a product distributed directly by Amazon, but then she might also want to buy two other products being sold on Amazon through other retailers. The platform is capable of accepting one payment from the consumer and distributing it correctly among all vendors. If the consumer wants, she can buy all three products on one card or put them on three separate cards. This flexibility is pretty unique, not to mention extremely efficient, effective and customer friendly. If she needs to confirm anything about her order, a complete history of every transaction is available in her account.
Not only that, but vendors themselves can use the platform to efficiently identify what’s selling best and what’s selling least, and stock accordingly, cutting down on inventory and other costs. They can also use the platform to issue coupons to bring customers back so that they’ll spend more money with them. These are powerful capabilities, and they can work in healthcare.
How this works in healthcare
Let’s say a patient, Jessica, schedules a knee surgery to repair her injured ACL. At the time of registration, Jessica makes a $50 copay and $200 prepayment toward her out-of-pocket costs. The registrar is able to take one payment, direct each payment type to the right place and then email Jessica a receipt.
After her episode of care, she receives one bill from the hospital, one from the surgeon and one from the anesthesiologist. Jessica is able to log on to her account, see the credits for payments already made and set up payments for the balances due. She may choose to spread payment out over multiple cards, schedule a future payment or even set up a payment plan to pay over time. The platform is designed to give Jessica the flexibility she needs to pay. When patients have this level of payment flexibility, they are more likely to pay. Just like Amazon, convenience encourages adoption.
For the business office, the platform automatically moves the data and dollars into the right places, virtually eliminating manual reconciliation and posting, increasing efficiency and eliminating costly human error.
Driving improvement and competitive advantages
Bottom line: Just as the health system treated Jessica clinically based on her individual symptoms, conditions and other factors, it can now treat her financially based on her individual financial needs and characteristics.
By leveraging this type of platform to process payments and customize financial experiences for patients just as Amazon does for merchants and consumers, both sides win: The hospital dramatically streamlines its payment collection capabilities, and the patient enjoys a greatly improved payment experience.
About the author
Bird Blitch is the cofounder and chief executive officer of Patientco. Follow him on Twitter at @BirdBlitch.
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.
