Just a decade ago, our health system clients averaged around 5% of their revenue due from patients. Now that number is often between 20% and 30%. Patient financial obligation is greater than ever and continues to rise. With high deductible healthcare plans becoming common, patients have a greater out-of-pocket burden than before.
This reality has unwittingly turned health systems into consumer lenders. “Of course, healthcare organizations are not set up to manage that,” says Will Reilly, VP of Client and Consumer Marketing at VisitPay. “They are not set up to be lenders…or to even really work with patients on an individual basis to help them manage the financial aspect of their care.”
Now that patients are responsible for paying a larger portion of their medical costs, providers need to rethink the patient financial experience. And patients have expectations about what that experience should be. Through extensive research, accessible in our 2020 VisitPay Report, we’ve been able to define clear insights into the consumer, so that health systems can better cater to patients’ financial needs and expectations.
Patient Insights Lead to New Health Payment Solutions
One thing the 2020 VisitPay Report shows is that patients want clarity. Participants in our survey said that, more than anything else, they wanted an explanation of benefits at the visit level and to understand the role of their insurance right from the start. They also want a consolidated monthly statement of all hospital and physician charges. The nuances in the different types of medical charges are inconsequential to them. Patients want to be able to pay charges together—just like they would pay any other bill. Lastly, patients want to know how much a procedure is likely to cost and to have a clear estimation of costs in advance.
These desired changes come with challenges—but those challenges have solutions.
Consolidating a monthly bill, for example, involves combining different health charges into one simple output. When different providers or facilities appear on one bill, there are complications. If the patient can’t pay in full, how is payment allocated? In VisitPay this comes down to having a sophisticated set of rules that can manage payment allocations to many back-end billing systems in a compliant and consistent way.
How about estimates and price transparency? One issue is that estimates may be inaccurate. The actual medical procedure or clinical need may change after the patient is admitted, altering the final costs. An inaccurate estimate can cause a negative patient experience and rework for the revenue cycle team. New technology can help automatically adjust payment arrangements as costs (and estimates) fluctuate throughout the process. If health systems present estimates, they need to make them actionable, communicate with transparency, and give patients options on how to pay. This will help patients better understand and accept any changes that may come.
“Transparency and flexibility are good things when it comes to working with all consumers around a financial experience,” says Reilly. “And even if [there are] changes, and even if the changes are not great…you will still engender trust and loyalty from having the conversation and being upfront about it.”
Improving the Healthcare Patient Experience
Understanding what patients want and value in their financial experience will help healthcare providers better manage their relationships with their patients.
“If you can put more emphasis on transparency and a good experience,” says Reilly, “then you actually can put less emphasis on collections and chasing down debt. And you’ll see happier, more loyal patients—and better payers. And that’s obviously good for the health system.”