Digital Solves Key Problems in the Face of Mounting Healthcare Collections

As consumer complaints about medical billing and collections pour into government agencies, healthcare providers and systems on the other side of the equation are trying to get reimbursed for the critical and often live-saving services they deliver.

In April, the Consumer Financial Protection Bureau (CFPB) said it sent more than 750,000 complaints to companies for review and response in 2021 over billing issues for a medical debt problem pegged at $88 billion, although some say the true figure is much higher.

As inflation presses in and consumers miss more payments, healthcare providers need to get ahead of a new wave of medical debt by providing the transparency patients now demand.

“As we see pressure on consumers, healthcare bills are one of those bills that get pushed to the bottom of the stack,” Experian Health Senior Vice President Jason Considine told PYMNTS.

Noting that federal aid helped people pay down debt and stay current with bills in 2020 and 2021, he said: “Those federal aid packages are being unwound, the country’s opening back up so people are spending money on things they weren’t spending money on before, and to compound that problem, we have inflation coming in at levels we haven’t seen in decades.”

It’s good timing to make technology investments that deliver the cost transparency and payments options that allow consumers to budget — and help providers get paid.

Features to focus on are those that help providers offer flexible payment options, provide estimates before or during the time of care and identify the correct medical insurance claim information so they can bill payers correctly the first time around, Considine said.

“All of those things are going to expedite payments for providers and help reduce the pressure on consumers, but I wouldn’t wait,” he said. “These solutions can typically take a little bit of time to get implemented and then adopted by patients, so the time is now for providers to get ready, prepare and implement these technologies.”

See also: CFPB Reports Flood of Medical Debt-Collection Complaints Last Year

Digital Healthcare Table Stakes

With the No Surprises Act and the Medical Debt Relief Act watch-dogging providers and credit reporting bureaus, respectively, the healthcare industry needs to update its billing and collections abilities.

That’s going to put organizations under new and different collections pressures, prioritizing “solutions that help give patients flexibility, offer them payment plans, and get them on the right financial pathway and provide estimates before the cost of care.”

Also, consumers now expect the same digital convenience from their doctor as from their bank. This is especially true among millennials and bridge millennials who are digital-first patients.

“Accessing Healthcare: Easing Digital Frictions in the Patient Journey,” a PYMNTS and Experian Health collaboration, stated that “digital-first patients face more challenges than nondigital patients on average in accessing the capabilities they need.”

Get the study: Easing Digital Frictions in the Patient Journey

In that study, 21% of digital-first users said they encountered issues receiving cost estimates before appointments, while only 2% of nondigital patients reported such problems.

“Historically, [healthcare] is an area where providers haven’t met the need of consumers,” Considine said. “Healthcare’s one of those areas where you don’t know what you’re going to pay before you go to the doctor. There’s not really any other part of our lives where that is true.”

Simply providing an estimate isn’t good enough anymore, he added. Patients want it texted to them, and they want to engage with it online.

“We want flexible options to pay that mirror an Amazon experience or other ways that we pay in the other aspects of our lives,” he said.

With new laws, we see fines levied against healthcare systems and billers who step out of bounds even accidentally, and with more patients willing to switch physicians than ever before, the time of antiquated, disconnected healthcare billing is slowly sunsetting.

Smarter Decisions, Sooner

Patients defecting from doctors and familiar health practices promises to become more pronounced unless these organizations are ready for a possible deluge of new debt this year.

Physicians and their teams have long controlled these interactions with little in the way of patient demands on things like pre-care cost estimates and payment options.

That’s the old model of healthcare, and it’s not likely to pull through past 2022. Considine said that we can expect more and more patients to defect from providers that don’t have the right billing and payment tools in place and gravitate toward ones that provide the most convenient patient and customer experience.

“What that’s going to look like is an experience that I can get an understanding of what I’m going to owe before I come in,” he said. “I’m going to have an ability to easily enroll in a payment plan if that’s what I want, to put a credit card on file and make it easy for me to pay, and then engage with my provider through online means.”

Readily available data is the key to all these offerings, and is central to solving issues around reimbursement and collections that hospitals need cleared up, possibly more than patients do.

From financial aid that may be available to other aspects of choice, “data is available before the patient comes in to know what the right financial pathway is for that patient. That may not always be a payment,” Considine said.

When patients want or need a payment plan, “we can know that ahead of time and offer the right payment plan based off their financial disposition,” he said. “That helps the consumer, it helps the provider, so leveraging data to make smarter decisions and more personalized decisions based off that patient’s unique financial disposition are all tools that are available to providers today.”

See also: Most Patients Satisfied With Healthcare Experience, but Want More Info Before Appointments