Mark Spinner

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, the cost of healthcare-and how to pay for it-is the greatest financial concern for Americans, and one of four U.S. households deferred needed healthcare due to cost last year. For those that do seek care despite the fear of cost, a 

 study found that 85% of patients with bill amounts between $500 and $1,000 did not pay their balance in full.

	In this era of high-deductible health plans (HDHPs) and patient consumerism, patients face anxiety and frustration over how to pay for care. However, providers and employers can make care more accessible by being proactive with the communication of positive healthcare financing alternatives. Consumers that are aware of these financing programs can make better decisions about how to access the healthcare they need to get well and stay well.

	For providers, the financial outcomes of this strategy support measurable returns such as reduced bad debt and increased yield on patient responsibility. However, the impact travels beyond financial statements. It creates meaningful strategic advantages, such as patient satisfaction, brand goodwill and loyalty, in a competitive healthcare marketplace where the patient-consumer is ascending.

	Here are four ways to embrace patient consumerism

Patients as consumers expect purchase financing options.

	Imagine going to an auto dealership, selecting a car and taking it out for a test drive. When you return, you tell the salesperson that you’re ready to purchase it. Rather than walking you through multiple financing options, he says he’ll send you a bill-or worse-asks you to pay for the whole car upfront. Would you still buy the car? Or would you move on to the next dealership down the street who offers multiple leasing and financing options? The reality is any business dealing in large-ticket purchasing today is offering consumer financing at the point of consumption, or losing market share to the competitor that does.

	Patients are beginning to have the same expectations in healthcare. If they’re paying thousands of dollars out-of-pocket, they’re going to look for providers who not only offer high-quality care, but also help facilitate payment terms they can live with-just as they would expect when purchasing other big-ticket items.

 Flexible payment options that adapt with real life.

	Legacy financing options like medical loans with high interest rates and/or high fixed monthly payments have some utility. A one-size-fits-all approach to financing is better than nothing, but providers should consider offering flexible, scalable options that ensure all patient occasions can be financed.

	The ability to offer monthly payment flexibility not only attracts more patients to pay, but also gives the patient a range of payment amounts that can help to keep them out of default when other unexpected expenses occur. In a third-party survey of 16,000 patients, 52% of those surveyed changed how they made their monthly payments in order to manage their budgets. These patients may have started on a zero percent interest payment plan, but switched to a plan that lowered their monthly payment amount and carried a low-interest payment. While the zero percent interest options incentivizes on time payments, having flexibility to change their plans at any time allowed patients to continue to pay their bills. Since money and affordability are personal and sometimes embarrassing topics for people, self-directed options also help keep patients empowered and engaged in a compassionate and dignified manner, without burdening the provider’s customer service staff.

	Solutions with distinct programs built for different consumer scenarios, such as balance after insurance for HDHP members, attracts more participation. When patients know they have realistic, affordable and flexible options, it enables them to choose the most appropriate care path for their conditions rather than deferring care they can’t afford, which drives bad clinical outcomes and higher long-term cost.

	World-class customer service and satisfaction is a core principle at The Ritz-Carlton Hotel Company. The staff are methodically trained with many customer service best practices like the “three steps of service,” which includes “anticipation and compliance with guest needs.” To truly optimize patient satisfaction, providers in consumer-driven healthcare need to do the same, by being proactive instead of reactive regarding the issue of affordability. The anticipation of the patient consumers’ potential need for positive financing terms, and the communication that your organization can provide them, is a fundamental part of a customer satisfaction policy built for excellence.

	Wouldn’t it be helpful if a patient notified the provider just before they decided to disengage regarding their unpaid bill? We never know which statement or email will be the last one that’s opened, or the last phone call answered. Essentially, when providers don’t initiate discussions about affordability proactively, they’re playing a game of “chicken” with the patient, risking that he or she might disengage at any time.

	Historically, providers offered payment plan terms only as a last resort. Taking that approach today will likely drive increasing amounts of bad debt as HDHPs continue to penetrate the marketplace. Patients now expect transparency and want to understand their responsibility up front. Using estimators, and discussing payment and financing options available can ensure patients have clear visibility of what they are looking for. However, if they face a bill they can’t pay, either health or wealth will suffer. In that moment, presenting a positive payment plan alternative can be a significant driver of patient satisfaction, and will keep more patients out of high cost, low yield bad debt collection situations.

	Patients who use flexible financing options are more likely to pay their bills. This, in turn, reduces bad debt for providers and fosters a more sustainable revenue cycle. For example, a large integrated health system in North Carolina who offers flexible financing options reduced their bad debt by 27% in a three-year period. More than 5,000 patients and employees of this system were surveyed and rated their patient financing plans with a net promoter score (NPS) of +55, an exceptional rating. The system’s own employees and patients feel genuine gratitude for having positive terms to help them meet their responsibility.

	The winners in this era of HDHPs and patient consumerism are going to have to approach the cost of care much like the sellers of other costly items. They’ll need flexible solutions that facilitate financing and help patient consumers afford their bills in the context of their current income. Otherwise, affordability as a barrier to care will continue to erode provider financial performance and public health while increasing long-term care costs for employers.

a provider of patient financing options designed to help patients manage their healthcare costs. 

Articles

Here’s how health systems can provide patients with ways to improve their overall financial experience as the frustration around high-deductible health plans continue to encourage patient consumerism. 

Author | Mark Spinner

Articles

Four ways to embrace patient consumerism