Embedded Financing Gives Patients Payment Options They Can Feel Good About

Fixing healthcare is a seemingly quixotic quest that has floored one administration after the next, but new digital financing options are turning wishful thinking into paid medical bills.

As being current on healthcare bills can impact actual health, more than money is at stake.

Sped up by the dramatic expansion of digital solutions during the pandemic, patient payments are undergoing a transformation that’s placing options on the table where none existed before.

In a flurry of recent news, Bond Financial Technologies and Texas Medical Center (TMC), and its Tanaflow health tech unit announced on Tuesday (March 22) that they are joining forces to create a new embedded payments solution called Bond Treasury.

“Nearly all healthcare transactions and tasks involve health insurance, payments, and finance yet financial technology specialized for healthcare is not widely available,” the partners said in a press release. “In the U.S. alone, these inefficiencies cost 35% of the $5 trillion annual healthcare expenditure. Embedded finance offers an elegant solution to this mounting problem.”

Odero Otieno, founder in residence at TMC and CEO of Tanaflow, said the medical center will use Bond Treasury to embed financial services into its applications, helping the 21 hospitals and eight specialty institutions under its umbrella, which treat 10 million patients annually, save time and money.

Triaging Broken Payments Models

In a recent PYMNTS interview, AxiaMed Co-founder and now Bank of America Senior Vice President and Executive Lead, Healthcare Strategy Kevin Kidd said demand is increasing for healthcare payment options that come into the patient journey at the right moment.

Kidd said requests are pouring in for integrated patient financing solutions and payment plans.

“We power payment plans and integrate to patient financing solutions for our providers. We allow them to utilize those integrated in their workflow,” he said. “If a patient can’t pay, they have some way of going ahead and getting the care and financing over time with a third party.”

See also: To Fix Patient Payments, Include Consumers in the Consumerization of Healthcare

That’s the critical point — patients receiving medical bills often far higher than their ability to pay — when financing needs to be presented just as buy now, pay later (BNPL) might in eCommerce.

According to The Access Channel: How Healthcare Financing Keeps Patients Engaged, a PYMNTS report with research sponsored by CareCredit, a survey of over 3,500 U.S. adults, “Nearly half the consumers surveyed did not know whether their healthcare providers offered payment plans or third-party financing options. Of the 31% who were certain their healthcare services providers offered payment plans or financing solutions, more than half used such options.”

Those findings indicate a far larger market for care now, pay later plans extant that isn’t being amply tapped by the sector, leaving plenty of room for nimble FinTechs like CareCredit.

Get the study: The Access Channel: How Healthcare Financing Keeps Patients Engaged

Options Expanding Fast

In another recent example of the trend, cloud analytics and value-based payments platform company Clarify Health announced in March it is acquiring Embedded Healthcare.

In a statement, the Clarify said it will blend Embedded’s behavioral science platform into its offering to foster better collaboration between providers and insurance companies adopting value-based payment models. The goal: improving patient outcomes and creating savings.

See also: Lynx Lays FinTech Tracks to Help Providers Integrate Healthcare, Finance Flows

Recently coming out of stealth, embedded health payments platform Lynx is another example of Fintechs moving to close a payments chasm of medical debt estimated in the billions.

That’s important from an accounts receivable (AR) perspective, and from a human one.

As Matt Renfro, CEO and co-founder of healthcare payments solution Lynx, told PYMNTS in an interview, “A fact that is missed by incumbents, maybe due to industry silos between financial services, payments, and healthcare … is [that] a person’s health and finances are directly correlated. When someone’s financial health declines, their personal health tends to follow.”

See also: More Businesses Turning to ‘Invisible’ Embedded Payments to Enable Growth