By Tomer Shoval, CEO of Simplee
Late last year, the Wall Street Journal’s Chris Mims wrote that “Every Company is Now a Tech Company.” For fintech entrepreneurs, a similar realization that every hospital is now a fintech company has created an opening in healthcare to apply artificial intelligence, machine learning and more to address affordability and transparency concerns.
In today’s healthcare system, financial care is nearly as important as medical care. Not only are a patient’s financial considerations the first and last interactions with a hospital – “How much will this cost?” and “How will I afford this?” – but studies show a patient’s financial experience often colors their lasting impressions and ratings of a hospital stay.
But the state of patient financial care remains in disarray. Affordability is the number one issue concern Americans, with 40 percent having skipped a recommended medical test or treatment due to price concerns. And more than two-thirds of patients are not paying their bills in full, draining a hospital’s bottom line.
Fintech leaders have a chance to step in with meaningful, proven solutions that can be applied in novel ways to healthcare. But first, they must understand the needs driving this shift and how to position new technologies as solutions.
1. Trust and Transparency in Billing
The pain points of healthcare billing and payments today are nearly universal. Insurance benefits statements arrive separate from actual bills. Hospitals can bill separately from pharmacies and even physicians for the same visit. And it can take hours or days –sometimes it’s even impossible – to understand the cost of care before undertaking a medical procedure. There is no other industry that operates so opaquely or with such persistent disregard for customers.
Amazon has trained consumers to expect to pay one bill, regardless of how many items you purchase or how many merchants you patronize during a visit to the website. Healthcare should be the same.
Fintechs can help build centralized back office billing practices connected to single, digital-first billing experiences for patients that deliver on promises of convenience and clarity. These bills must be rooted in guaranteed up-front estimates accessible to patients online or over their phones as digital, self-service tools.
Those bills must also be actual true cost estimates based on what each patient will pay given their insurance coverage. Fintechs have a long history of providing both through data scraping and other technologies that can easily deliver enormous value for both patients and health systems.
2. Personalization and Self-Service
Online merchants are adept at tailoring interactions to individual customers by offering personalized recommendations, acknowledging them when they return, using saved payment preferences, and extending that across platforms and devices. Healthcare must follow suit and can leverage fintech best practices around data analytics and mobile platforms to do that for financial considerations.
At the same time, consumers have become accustomed to convenient, self-service experiences for paying for everything from utility bills to airline tickets in just a few taps on their phone. Providing patients with digital-first, self-service experiences like obtaining estimates or viewing payment plans can boost patient satisfaction scores while saving hospitals money.
Kettering Health Network is a prime example of this. Before the system’s new digital patient portal launched, call center representatives were fielding over 1,000 calls per week regarding bill payment. Launching the portal reduced call volume by over 50% and enabled the system to maintain service levels without adding staff.
3. Health Specific Alternative Underwriting
With so many people unable to handle bills over $400, loans and payment plans are a natural solution when confronted with large medical obligations. A recent poll revealed that Americans borrow $88B annually to pay for healthcare costs. But it’s not always easy to get access to those loans; in fact, one third of the money raised in GoFundMe campaigns is for healthcare expenses.
This is largely because while the cost of medical care and the patient obligation has grown too large, hospitals still rely on the industry’s standard 12-term payment plan. Just as no doctor would use a one-size-fits-all treatment plan for patients, health systems can no longer use the default 12-term payment plan for patients. The resulting burden is simply too great.
Powered by insights mined via predictive analytics and mirroring efforts in alternative lending, health systems can proactively serve up customized payment options that direct well-off patients to pay their bill in full while offering a patient of lesser means discounts and an extended payment plan for the same bill amount.
These systems will rely on best practices culled from subprime and alternative lending but leveraging unique data indicators for healthcare. Specifically, the prior patient history with a hospital can be a powerful tool in determining ability and intent to repay.
4. Choice in Payments, Emphasis on Mobile
Retailers long ago learned that offering multiple card types is an easy way to reduce the friction of collecting payment from customers. Today that has expanded to mobile, cards, online wallets and many other sources of funds. As the cost and obligations of medical care increase, being able to accept multiple payment instruments, including cards, bank accounts, and specialty healthcare products like CareCredit’s patient line of credit is critical.
This is especially true of mobile payment platforms. Americans of all ages have become accustomed to making purchases large and small on their cell phone. From toothpaste to cross country airline tickets, there is almost no limit to the types of payments consumers now routinely make on mobile devices.
But even with consumers’ growing familiarity with mobile bill pay, the percentage of healthcare payments made via mobile device remains stuck in the single digits. Fintech can smooth the path to health systems’ embrace of a more consumer-centric and mobile friendly mentality around the patient financial experience.
Tomer Shoval is CEO and a co-founder of Simplee. A veteran e-commerce leader, Tomer is a frequent speaker on the intersection of healthcare, technology and consumers. He founded Simplee as a way to help people better understand and manage their health care bills.