Why a Better Patient Payment Experience is Good Medicine


If you ask people what’s worse — getting sick, or getting the bill for treatment — you might be surprised at the response.

Paying for medical care is a nightmare for consumers. In fact, medical debt is the number one reason people file for bankruptcy in the U.S., and about one in five American adults have unpaid medical bills.

Medical debt has also become a massive issue for providers. The amount of bad debt accumulated by hospitals alone is estimated at $40 billion to $60 billion a year, and the problem is only getting worse: Moody’s expects an uptick in bad debt as patients take on a larger portion of their healthcare costs.

What’s hopeful is that some of this debt might have been avoided with a better, clearer, and easier-to-use consumer payment experience, according to a study by the Consumer Financial Protection Bureau. As Modern Healthcare reports:

“About half of consumers who only carry medical debt have no other signs of being under financial distress. But complaints to the CFPB indicate that consumers are routinely baffled by medical bills. Unwieldy insurance and hospital statements leave them uncertain as to how much money they owe, the deadline for payment, and which organization should be paid.”

(Of course, it doesn’t help that medical practice staff aren’t always focused on collecting payments — in fact, our recent Patient Experience Index (PXI) research found that over one-third of patients are never even asked to pay for outstanding balances!)

Given the importance of this topic, I recently sat down with Mark Schulze, co-founder of Clover and VP of Business Development for First Data, to talk about what medical practices should be doing to innovate in the area of consumer payments. I’ve gotten to know Mark quite well since we partnered with First Data to introduce a better patient payments experience in our new Breeze platform, and he’s someone with a very deep understanding of the dynamics in this space. Here are a few insights he shared with me.

First, it’s very clear that consumers are quickly coming to expect flexible payment mechanisms, particularly as merchants in other industries are now offering many different payment types and services. Mark noted that First Data is seeing a rapid uptake in new payment methods such as Apple Pay and Google Pay, and strong adoption in merchants who embrace them. We’re now seeing those same expectations showing up in medical practices.

Mark also stressed the growing importance of online access to receipts and payment records. He shared that although access to receipts and records might seem like a small thing, it’s something that people are coming to expect and demand.

Think about how easy companies like Walgreens and Amazon have made it to find your past transaction records, then compare this to what you typically have to go through to get financial records from your doctor… or the struggle of managing HSA reimbursement with tiny, generic credit card receipts. With more of the financial burden for healthcare passing to consumers, giving patients the ability to search and pull up records for expenses, taxes or reimbursement is absolutely critical.

Adding to Mark’s insights, we also found in our PXI study that flexible payment options and online payment capabilities are increasingly important when it comes to patient retention. Younger patients in particular have a high propensity to churn when they don’t have modern payment mechanisms: for example, over one-third of 18 to 29-year-olds said they would switch providers in order to pay their bills online.

Finally, upgrading the payments experience can have a substantial impact on the practice’s bottom line. We’ve seen practices that implement modern payment solutions increase their revenue by 40% or more, increase cash flow by 28% and cut days in accounts receivable by half.

Smart practices get it — for many, though, the challenge is how to get started. If you’re in this boat, I encourage you to check out the payments capabilities in our new Breeze platform. With Breeze, patients are able to view and manage their existing balances on the go. They can also use their payment method of choice, including credit, debit, mobile wallets, HSA, cash, or check. And, you can let them set up partial payments or payment plans so they can pay when and how they want.

What is your practice doing to make it easier for patients to pay?

This article originally appeared in LinkedIn.