| The skinny
Research released last week shows that healthcare providers collect just 31% of patient bills on average, with much of the remainder tied up in extended payment plans. The report, published by healthcare finance startup PayZen, was based on surveys of 205 revenue cycle leaders from health systems across the country. Even as providers struggle to collect patient payments, those payments are accounting for a growing portion of overall revenue. On average, patient billing makes up 12% of a health system’s total net patient revenue, the report stated. Patients want more
The report shows clear gaps in patient demand for flexible payment options and what health systems currently offer. Many providers cap in-house payment plans and often do not partner with third-party financing companies — even as rising healthcare costs are causing more patients to need these types of flexible payment options. Tobias Mezger, PayZen’s co-founder and chief revenue officer, also pointed out that there hasn’t been much adoption of pre-care payment workflows, which he finds troubling. First and foremost, he believes the ideal patient financial experience is one where patients know their out-of-pocket costs before scheduled care. Beyond that, he also thinks patients should be able to understand and access all available options — such as Medicaid eligibility, financial assistance and payment plans — before they receive care. Financial conversations between providers and patients become much more difficult after care is delivered, Mezger stated. Retention and revenue
Mezger noted that the patient financial experience can be directly linked to loyalty and retention, with patients being more likely to return to a health system if they receive financial education and flexible payment options. He also argued that improving patient finance is not just about satisfaction — it can also improve the provider’s collections. “If you make it hard or confusing for a patient, or don’t give the patient the flexibility they need to make this work with their income, then you get paid less. You're leaving money on the table,” he declared. — By Katie Adams
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