What Health System CFOs Need to Know About the Patient as Payer

Financial leaders and health system CFOs from respected healthcare systems in the US, many of whom utilize Epic as their EMR, have identified the significant need for a solution to manage patient finances. Driving this decision is the seismic shift of the patient becoming the “new payer.”

Healthcare systems are now seeing a 40/40/20 receivable split owed by each of the three major payer groups – government, commercial, and patient. But the patient is a very different payer for two distinct reasons: first, patients pay much less of what they owe after contractual adjustments. Whereas commercial and governmental payers pay nearly 100% post-adjustment, patients pay on average less than 50% after their in-network discount. Second, patients – which I will henceforth call “consumers” – demand a financial experience on par with what they experience in other markets, and rightfully so. Every place they shop, manage finances, or transact, especially online, provides an efficient and satisfying customer experience.

In all markets, payment rates (yield) and consumer experience are inextricably linked and positively reinforce one another. But healthcare finance has not been able to deliver the experience expected by consumers, leading to a downward spiral of yield and poorly designed consumer financial strategies.

What Current Patient Billing Solutions Are Not Solving: Bad Debt

A thoughtfully-designed, proven consumer finance strategy is necessary to drive both yield and consumer experience, and that strategy must consist of four competencies:

  • Tailored experiences for each consumer
  • Smart long-term financing, that balances yield and days AR
  • Testing and learning cycles to enable innovation
  • Full automation, for both the consumer and health system

It is rare for even the most advanced EMR systems to provide these competencies. For example, a portal like Epic MyChart only digitizes a bill and a payment. They do this by providing an e-statement, an interface through which consumers can make one-time or recurring payments, and a mostly automated transaction posting process. This digitization creates efficiency and in some cases, may increase consumer satisfaction. While it may lead to lower costs, it is less likely to generate measurable yield improvement and reduce bad debt.

It makes great sense that healthcare systems choose Epic for its EMR and insurance billing functionality. But a different approach that offers the four mentioned competencies is necessary to contend with the mountains of bad debt piling up in healthcare systems across the country.

A Different Approach with Seamless EMR Integration

Our approach systematically increases yield and consumer satisfaction by building finance strategies that can be tailored to each consumer. Importantly, it integrates with Epic in a way that is seamless to both health system and consumer.

VisitPay was founded by a team of former Capital One executives – we set out to apply our over 100 years’ collective experience in consumer finance to healthcare, understanding that we couldn’t just “bolt on” consumer finance strategies to the complex healthcare market. So, we decided to roll up our sleeves and work in revenue cycle before building VisitPay. Our CEO ran the revenue cycle for 13 months for a major health system, during which time the system converted to Epic. In working with our initial clients, we uncovered over 80 different pain points that existed in the healthcare billing process which inspired the engineering of VisitPay.

A significant part of our initial engineering was building a data architecture that enabled the fusion of consumer finance best practices, world-class account-level scoring, and healthcare-specific needs and realities. This architecture was designed to work in unison with Epic and other billing systems, in such a way that didn’t disrupt the upstream insurance billing processes. As a result, VisitPay provides a fundamentally different and better experience to the healthcare institution and consumer by delivering upon the four strategic competencies listed above.

Learn how St. Luke’s Health System turned to VisitPay to better meet the needs of their patients.

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