83% of Small Healthcare Providers Use Instant Payments

The rise of real-time payments is revolutionizing the patient experience in healthcare, mirroring consumers’ demands for seamless digital interactions across their daily lives.

The PYMNTS Intelligence report “Small Business Real-Time Payments Barometer: Healthcare Edition,” part of the broader Real-Time Payments Tracker Series, sheds light on financial pressures facing healthcare providers due to late payments.

These delays are especially tough on small players, as the data shows that the average small healthcare provider receives a quarter of its payments late. The stretched payment terms strain balance sheets, complicate cash flow and divert resources to accounts receivable.

Real-time payments are cementing their place as a remedy, capable of eliminating long processing times to improve cash flow and accounting accuracy.

The study reveals a strong trend toward adoption, with 83% of small healthcare businesses having used real-time payment rails last year, and approximately 8 in 10 of those reporting high levels of satisfaction.

This shift is pertinent given recent events, such as the large-scale cyberattack on Change Healthcare in the first quarter of 2024, which exacerbated payment delays and underscored the vulnerabilities of traditional payment processes.

Among the report’s findings:

Patient Convenience Drives Adoption: For payers, which includes patients, ease and convenience ranked as the second-most important advantage of real-time payments.

Provider Willingness to Offer Faster Options: The majority of healthcare provider SMBs are poised to embrace instant payments, as 64% of healthcare provider SMBs expressed strong interest in sending real-time payments in the coming year, and 68% were highly interested in receiving them.

Speed as a Core Benefit: The underlying desire for quick transactions, which directly translates to a more efficient and less burdensome patient interaction, is a key driver for providers. Among small- to medium-sized businesses (SMBs) in the healthcare provider segment, 61% who sent real-time payments cited speed as an important benefit, with 57% of those receiving payments agreeing.

Despite the advantages and growing adoption, the journey to universal real-time payments in healthcare faces hurdles. The report highlights that 17% of SMB providers still do not use real-time rails, primarily due to concerns about fraud and customer reluctance to adopt new methods. Specifically, 31% of those not sending real-time payments cited the heightened risk of fraud as a primary concern, while 26% of those not receiving them pointed to limited customer adoption.

Other deterrents include perceived cost, a lack of bank support and the perceived difficulty of use, although perceptions often deviate from the reality of user-friendly and cost-effective solutions. The overarching demand for improved efficiency, patient satisfaction and financial stability continues to fuel the appeal of faster payment options, promising streamlined operations and reduced administrative burdens for providers.