Unlike other industries, healthcare has been slow to adopt technology that would yield more financial success by streamlining the payment cycle. That narrative is changing thanks to rising self-pay payments. Providers are increasingly looking to patient payment systems that will streamline the revenue cycle from start to finish.
Rising Self-Pay Payments
Did you know that the majority of patients only pay 40-50% of the total balance owed? (Source: MGMA Connexion) Thanks to increased deductibles and and higher co-pays, the rate of self-pay payments has skyrocketed in the past couple of years. Patients struggle to pay their medical bills primarily because they are unprepared for the sticker shock of increased rates under their new health plans. As a result, patient bad debt rises and practices struggle. It’s a never-ending cycle of bad debt, and it’s a hard one to break.
That’s why more providers are looking for financial solutions in patient payment systems. Innovative technology that addresses the patient payment challenge is now a necessity for practices that hope to break the bad debt cycle and improve revenue.
Patient Payment Systems To Break the Patient Bad Debt Cycle
As more providers adopt technology that helps streamline patient payments, the result is improved revenue and cash flow and lower rates of patient bad debt. Patient payment systems come in many different variations. However, the most important component to look for in a patient payment system is in how it handles the point of service interaction with patients. Point of service payments are the easiest to collect. In fact, the graphic below from a report from McKesson, shows that the likelihood to collect payments significantly decreases after the point of service.
So, when it comes to patient payment systems to improve collections, look for the following features to yield the greatest success.
3 Features of Patient Payment Systems That Are a Must-Have
1. Insurance eligibility verification
Insurance eligibility should be verified before a patient’s appointment, then confirmed at the point of service within the system. This helps handle patient’s expectations for payment and catch any errors before they occur.
2. Cost estimation
The cost estimation feature is essential in choosing a patient payment system. The ability to provide patients with an estimate of what they will owe for their visit directly meets patient needs for transparency. Patients expect transparent communications from their healthcare experience, most importantly in the financial component. An estimate of costs helps patients better prepare to pay their bills on time and in full.
3. Collect payments beyond copays
This is an aspect of the patient revenue cycle that is often overlooked. Many practices will expect copays to be due at the time of service, but they often stop there. Instead, using technology, you can collect a patient’s copay and either a portion of their balance due or the entire balance. And the best part, this can all be done right within the payment system and at check in. For example, patient check in kiosks allow patients to settle up payments right then and there, before they are even seen for their visit. This feature meets patients’ demands for convenience. Like their other shopping experiences, patients expect a convenient way to make payments.
As healthcare continues to evolve, self-pay payment responsibility will likely continue to rise. Providers need to be prepared with the right technology to collect payments from patients when they are due, not 90 days later. Consider these features when you are shopping for a patient payment system to meet your revenue cycle needs.