Getting to the finish line is one thing. But getting a good start is another matter entirely, and that holds true for the all-important issue of healthcare payments. Patients, hospitals and medical services providers that fail to get a good handle on costs, bills and payments at the start of the care process increase the risk that payments will go uncollected, among other problems.
Karen Webster of PYMNTS recently caught up with Tomer Shoval, CEO of Simplee, for a discussion about bringing more efficiency — including via digital and mobile methods — to healthcare payments, with the end goal of enabling more recouping of medical costs and perhaps even improving patient care over the long term. As Shoval told Webster, the patient share of overall medical costs remains pretty low but it is increasing as hospitals get more aggressive about collecting outstanding bills. “The portion that is coming from the patient is increasing really fast,” he said, adding that the patient share will soon reach 20 percent to 30 percent.
The more specific occasion for this recent PYMNTS discussion is the launch on Wednesday (Oct. 2) of the Simplee Access Prepare & Pay service. The tool is designed to bring more automation to the medical appointment process, and to craft personalized healthcare payment plans for patients before they undergo procedures or access services. Such transparency, Shoval said, makes it more likely that patients — even those living paycheck to paycheck, or with relatively low incomes — will pay their bills, which in turn not only can ensure they follow through on medical care, but make them more loyal to particular healthcare providers, and improve the bottom line for those providers.
Pain Point Advantage
“We turn a pain point into a competitive advantage,” Shoval said.
And what a pain point it is — news recently emerged that the average U.S. family spends some $20,000 a year on healthcare. Indeed, the average hospital balance for a consumer stands at $980, according to one expert recently interviewed by PYMNTS. Another estimate found that two of three U.S. consumers cannot pay off their hospital bills, a proportion that has been increasing in recent years. Not only that, but many medical bills are ignored — we’ve been trained to expect revised bills after insurance and other adjustments are made — or simply lost under a mound of to-do paperwork. “Usually, we want to do things after hours or on the weekends,” he said.
All that, in turn, produces pain for hospital and medical services providers. And that’s where new, mobile- and digital-focused forms of payments come in, Shoval told Webster. “They might be getting five to 10 cents on the dollar,” he said, referring to all those bills. “If we can do 50 cents on the dollar, that’s a major change.”
The power for that change, at least going by the Simplee launch, is to provide better cost estimates to patients, and do it up front — after all, according to the company, less than 10 percent of patients receive such estimates. Simplee uses a variety of tools — data about procedure costs, analysis of patient payment behavior, and machine learning among them — to arrive at personalized estimates and payment options for patients. The new Simplee service also includes appointment reminders, on the theory that 1) that part of healthcare needs more efficiency and automation; and 2) people who know the price going into a procedure, and are locked in to the appointment, will more often follow through on their treatment plans than will other consumers.
Indeed, data seems to bear out Shoval’s optimism, as the healthcare providers that use Simplee tend to have Net Promotor Scores on par with such top consumer brands as Nordstrom and Mercedes Benz. And patients using tools from the company tend to be twice as likely to pay their bills than other consumers, and five times as likely to recommend the service to others.
Simplee is already working with several major healthcare providers and related players in the space, including Cerner and Florida-based AdventHealth — the latter of which has enjoyed a 41 percent increase in collections and an 8 percent decrease in patient appoint no-shows via Simplee, according to the company.
Shoval explained that the payment plan and estimate part of the tool operate, as he put it, as pretty much the opposite of how consumer lending works. For instance, imagine there is a patient with a low FICO store — that person is going to have a harder time getting a consumer loan, but Simplee doesn’t use FICO scores. The company essentially creates its own version of such scores for use in determining healthcare payment plans, but with an opposite effect. People with bad credit, after all, still need healthcare, and it’s in the providers' best interest to make sure such patients are on pragmatic payment plans so as to avoid collections.
“If we think you are going to struggle [with medical bills],” Shoval said, “that’s where we will be the most generous in the offer we give you.” And that could then increase the chances of repayment over time, he added. “If we believe you can pay the full amount, our first interaction is asking you to pay the full amount,” he said.
As Shoval views the long-term situation, healthcare payments need to take more cues from the larger consumer world and become, for instance, more like increasingly popular mobile-order ahead services, or even automated airplane boarding pass processes. “The future of healthcare is bringing in that expertise and those best practices,” he said.
In short, the future of healthcare is about better consumer experiences, with payments providing the fuel for innovation and disruption.