The Digital Payments Genie Is Out Of The Bottle For Healthcare Providers

When it is said that healthcare has historically lagged behind in the adoption of innovative patient payments, it can be hard to understand just how deep the problem lies. More than not having the most cutting-edge technology to offer, Rectangle Health Chief Operating Officer Scott LoPresti told PYMNTS in a recent conversation, but a matter of the industry being behind the rest of the world by decades in its payment offerings.

“The hotel industry has done card on file for many, many years. I can’t think back to when I went to a hotel and didn’t put a card on file immediately. And yet in healthcare it’s always kind of been pushed away as a practice,” LoPresti said.


The lag, he said, was created by concern in the segment that patients wouldn’t be receptive to new payment processes. That resistance held firm until COVID-19 came along and bulldozed much of the industry’s fears around modernization. COVID-19 created a necessity for new protocols, and the healthcare industry realized it had to do something different for patients who were unable to come into the office and make their co-pay at the front desk before their visit or as they left. What the industry learned, he said, is that not only does new payment technology work, but consumers who are by now familiar with options such as card on file actually like the change.

For all the pain it caused, he said, the pandemic pushed healthcare into a new reality — that it has to be open to new ideas in order to capture “the opportunity that’s out there.” That means embracing not only the new advances popping up today, but the upgrades that have existed all along but never rose to prominence in healthcare.

“It’s not just about being behind on the technology, the newer things like contactless payments or text to pay. It’s just overall, the practices have been hesitant to introduce anything different in the patient payment methodology,” LoPresti explained.

Employing New Tactics

 Contrary to the conventional wisdom that dominated healthcare until about 15 months ago, he said, patients are not afraid of change — in fact, their expectations of it is what’s pushing healthcare’s transformation. Patients aren’t only open to the idea that healthcare payments can and should be different, they are actively expecting their providers to offer a more expanded menu of payment options.

An expanded menu can serve both consumers and practices better. For example, when a patient doesn’t pay their outstanding balance, after significant efforts, practices may hand the bill over to a collection agency. This means the provider will collect less than the full balance, and patients must face the ramifications of dealing with a collection agency. All of that, LoPresti said, can be avoided if practices learn to talk to their patients more directly about managing the cost of their care upfront — and offer them a better bevy of options, like paying over time, that better suit their financial needs.

“We work to educate the practice on the idea that if you take it upon yourself to really communicate upfront to the patient that they have options, and that the goal is to give the patient some freedom to be able to make the payments in a way that’s not going to be too intrusive upon them, it is going to be much better,” he said.

The provider gets paid, he said, and paid in full. Patients, meanwhile, escape the onerous process of collections and, more importantly, actually get the care they need because the cost concern was addressed upfront.

The Path Forward 

At the height of COVID-19, he said, some 80 to 90 percent of healthcare payments were happening remotely — pushed there by the necessity of the times. And though that has ebbed a bit as COVID-19 has started to wind down, it hasn’t reversed. A good number of transactions in healthcare are still happening digitally rather than in person, despite the great reopening.

Healthcare isn’t going back to where it was before, he said, because both patients and providers have found that, with the inclusion of digital technology, there are many ways to do it better than they were doing it before.

“They’ve had the ‘aha’ moment. They’re starting to realize what they are capable of doing that they weren’t doing in the past,” he said. “And we have seen a shift across the entire industry coming from that.”