Payment plans are becoming increasingly popular, now that more patients are faced with higher healthcare costs. A new study confirmed that fact with data that supports the idea that payment plans offer a viable solution to one of healthcare’s biggest challenges – how to capture lost revenue. The study, titled “The Changing Landscape of Healthcare Payment Plans,” involved 2,800 healthcare consumers across a broad economic and demographic spectrum.
Payments Plans Facilitate Collections
Researchers found, for instance, that patients who use a payment plan are more likely to pay off expensive healthcare bills. More than 70 percent of patients who used a healthcare payment plan also said they’d use one in the future, and that it would help them pay medical bills in a timely fashion. They also expressed a strong preference for paying online, through a digital platform. Although about half prefer convenient electronic billing, the study indicated that those who still like paper statements are mostly older patients concerned about security. That indicates that as long as payment platforms can ensure HIPAA and PCI compliance and robust cyber security, even older healthcare consumers will transition to paperless invoices.
Patients Want Payment Plan Options
The study also found that nearly a third of those polled said they like shorter repayment schedules, if it helps them avoid additional fees or interest payments. So one takeaway from this study is that offering payment plans with no extra fees motivates patients to pay, and pay sooner. Practices and hospitals can create payment plans to ensure shorter revenue cycles and less collection effort, for significant savings of time, labor, and money.
Meanwhile, nearly 60 percent of those surveyed said they’d like to be offered a payment plan either at the time of their procedure or before then. Providers who give patients a payment plan option ahead of time will likely have greater success at getting paid on time and in full. Waiting to offer such plans after sending the patient their bill is a less effective strategy, according to patient feedback.
Too Few Providers Offer Payment Plans
Research indicates that the use of payment plans will likely double in the near future, as their availability increases. There is strong demand from the patient side, because patients are now typically responsible for about a third of their medical costs. But hospitals are also urgently seeking solutions because they are currently only able to recoup about a third of what patients owe. Especially when medical procedures are extraordinarily expensive, payment plans represent a practical solution for both patients and providers.
But it’s important to note that more than 90 percent of patients do not like to have to call their provider or hospital and request a payment plan. Providers should instead offer plans to patients in a proactive way, without having to be asked. Otherwise, researchers found, some patients will forego care because they are afraid they cannot afford it. When that happens, patient populations incur more risk of getting sicker – which only exacerbates the challenges healthcare is striving so hard to overcome.