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.