How Healthcare Leaders Can Improve Patient Billing In The Face of Medical Debt

David Law

By David J. Law, chief client officer, Zotec Partners.

Americans collectively owe almost $200 billion in medical debt. With inflation rising, the cost of living increasing, and healthcare providers struggling to keep up with post-pandemic demand, this ballooning debt is causing patients and providers alike a lot of undue stress.

At the same time, the country’s medical debt collection processes are changing. In March, credit reporting agencies announced they will exclude all medical debt under $500 from credit reports by the first quarter of 2023. Furthermore, agencies will wait longer to report larger medical debts to accommodate patients who need more time to figure out and calculate their healthcare payment status.

Healthcare leaders are under pressure to make patient bill care easier and more transparent. They need ways to remain profitable while putting patients — and their financial well-being — first.

Why is prioritizing patient well-being such a challenge? 

It’s clear that one of the healthcare industry’s priorities in the coming years must be making healthcare profitable for providers and affordable for patients. But what does this mean in practical terms? Why is this balancing act still so challenging for healthcare leaders?

For starters, the industry’s surroundings have shifted drastically in the last few years, and the economy has not lent itself to profitability or well-being. We’re living with a 40-year high in inflation, and deductibles are up without a match in salary increases. Patient payers are taking on more of the financial responsibility of their healthcare, and 49% of Americans wouldn’t be able to pay an unexpected $500 medical bill without going into debt.

This financial landscape is very real for patients, and stress is high. Emotional turmoil has always been part and parcel of healthcare — people are full of fear when they or their loved ones are sick and in pain — but stress is especially overwhelming now with medical debt carrying even higher stakes.

Patient expectations have also changed. They are seasoned digital consumers now with several choices in most areas of their lives. While people need a safe and clear healthcare experience, they also want a retail-like experience with the ability to choose their preferred methods for care, payment plans, and communication.

Additionally, providers are being squeezed. Medicare rates are holding steady or going down. Practices are facing extreme challenges; everything from supplies to staffing to maintaining healthy margins is becoming increasingly challenging — especially for those located in rural areas.

Despite these challenges, there are ways for healthcare leaders to comfort and aid patients even as the financial burden is high.

What can healthcare leaders do to address the balance between profit and well-being?

Providers get into healthcare to help others. They still have a business to run, however, and part of that is fairly and accurately collecting on services rendered. How can they strike this balance in today’s financial environment?

  1. Provide upfront cost estimates.

One of the most harmful practices in healthcare is how costs and bills are packaged. Confusion and surprise abound for patients when they look at their statements. So, one of the many approaches to enhancing the healthcare payment experience is through upfront cost estimates. Practices should utilize highly developed technology to offer better patient bill care. By calculating remaining unpaid deductibles and out-of-pocket costs, providers can empower patients with financial transparency prior to service, during the encounter, and at the time of billing.

  1. Offer multiple payment options. 

Payment choice is both a need and a desire for today’s patients. Leaders can help them by providing multiple payment options such as time-of-service payments, credit cards, smart cards, checks, and so on. In addition to these methods, patients are increasingly looking to payment plans to help them manage the financial burden of their healthcare without negatively affecting their credit report.

  1. Listen to patient experiences. 

It’s vitally important to listen to patient feedback and actively seek it out. Patients who are anxious about health and finances need time and space to ask questions and share their experiences. Opening these lines of communication, especially during the billing and payment processes, can help patients feel more in control and satisfied with their experience of care.

We’re all patients, after all. Immense opportunity exists for everyone when providers and healthcare technology partners work together, enhancing the entire healthcare experience — financial and otherwise — with every encounter, for every patient.


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