Easing the Burden: Patient Financing for High-Cost Care

Healthcare costs in the U.S. continue to rise, with emergency room visits, specialty departments, and complex care services carrying some of the highest price tags. Emergency departments, oncology clinics, infusion centers, and specialty care departments regularly treat patients facing life-altering diagnoses that require expensive therapies or procedures. These high-cost episodes—often unplanned—leave patients struggling to manage the financial implications while hospitals and health systems bear the weight of uncompensated care. 

A study conducted and published by The Health Management Academy entitled “Health Systems at a Liminal Moment, Health System Strategic Priorities for 2025” identified Patient-Access as the gateway to mission and growth. Access includes the mix of services, caregiver services, and a key component is the excessive cost of care and making it more affordable and accessible to all patients. 

Even insured patients often encounter financial hardship due to high deductibles, co-pays, and out-of-pocket maximums. Meanwhile, un- or underinsured individuals face medical debt that can lead to delayed or forgone care. The financial burden of medical treatment extends far beyond the individual patient. Providers, especially those in rural areas, experience mounting financial strain as they treat more patients without secure reimbursement. 

Despite these challenges, the healthcare industry has been slow to implement financing solutions that proactively address patient financial access and affordability. Unlike other sectors where financing options are standard at the point of purchase, healthcare traditionally reveals financial obligations only after care services have been provided. Patients are often left with unexpected bills and limited options to manage their costs. This delay in financial transparency exacerbates the medical debt crisis, which remains one of the leading causes of financial hardship in the U.S. 

Without a proactive approach to patient financing, healthcare systems will continue to struggle with delayed payments, bad debt, and declining patient satisfaction. Given these realities, health systems must rethink patient financing strategies to ensure financial sustainability while enabling equitable access to necessary care.

The State of Patient Financing: A Broken System

Healthcare costs are often opaque and unpredictable. Patients are left unprepared for the financial reality of their care, leading to an increasing reliance on in-house payment plans or recourse-based options that fail to provide meaningful relief. Rising healthcare costs and potential reductions in Medicaid funding have further exacerbated the issue, making it more difficult for hospitals to collect payments in a timely manner.

Emergency departments and specialty care providers face the highest financial risks. These areas of care are often associated with sudden, high-cost interventions, and many patients lack the resources to cover their expenses. Patients who visit emergency rooms or specialty practices may not have pre-existing financial arrangements, forcing hospitals to navigate payment collection after treatment has already been administered. Without a better system in place, hospitals are left with growing bad debt and a patient population burdened by financial stress.

Special Consideration: The Rural Healthcare Challenge

Rural hospitals face disproportionate financial challenges. Rural healthcare providers face mounting financial pressure, with many struggling to cover operational costs as patient payments fall short. According to the Chartis Center for Rural Health, 46% of rural hospitals currently operate at a loss, and 432 hospitals are at risk of closure due to financial instability while 80% of the population are considered “medically underserved.” 

Factors contributing to rural healthcare financial strain include:

• Lower commercial insurance coverage and higher Medicaid/self-pay patient mix. 
• Limited financial resources, outdated tech systems, and fewer specialty care options. 
• Higher levels of uncompensated care: 96% of rural healthcare providers cite operational and payer improvements as the reason for financial optimism, not patient payments, indicating ongoing struggles with collecting patient balances.

Unlike urban hospitals, which can often offset losses with commercially insured patients, rural hospitals serve lower-income populations, where even modest out-of-pocket costs deter care. This leads to delayed treatment, worsening conditions, and costly emergency visits, often resulting in medical debt that weakens hospital finances.

To address these challenges, rural hospitals need solutions that make care more affordable at the outset. Expanding patient financing programs can help remove financial barriers, ensuring patients access treatment before conditions escalate. Structured payment plans—offered at scheduling— tailored to patients based on factors such as income and risk rating can also ensure that low-income patients have viable payment options, reducing financial barriers to essential services. This allows hospitals to reduce uncompensated care while improving cash flow and sustainability.

Navigating the Financial Fallout of Specialty Care

Let’s look at a hypothetical situation and what traversing through these exorbitant costs looks like for the average patient in a real-world situation. Consider the case of a single mother working two jobs to support her family. One evening, her 12-year-old son experiences severe abdominal pain. Fearing for his health, she rushes him to the emergency room, where he is diagnosed with appendicitis. The necessary surgery is performed immediately, and the boy makes a full recovery. However, the financial impact is devastating.

The mother, who has insurance through her employer, is shocked when she receives a bill for more than $12,000 in out-of-pocket expenses due to a high-deductible health plan. Even after insurance coverage, she is responsible for a significant portion of the cost. Without savings to cover the amount, she is forced to delay payments, causing her account to be sold to a debt collector for collections. Her credit score suffers, and she faces added financial stress while caring for her son.

Meanwhile, her unpaid bill at the hospital contributes to the growing pool of uncompensated care. Like many healthcare providers, the hospital struggles to collect payments from patients in financial distress, impacting revenue and straining resources. With almost 70% of emergency care services going un- or under-compensated, hospitals are forced to absorb billions in unpaid medical expenses annually, affecting their ability to invest in new technologies, hire staff, and provide quality care.

This situation is not unique. Across the country, patients in emergency and specialty care settings face similar financial burdens. The lack of upfront financing options leaves patients with unexpected debt, forcing hospitals to navigate complex and often unsuccessful collection processes. Patients and providers will continue to struggle without changes to the patient financing model.

Given these financial complexities, health systems must expand their approach to patient financing. The patient experience extends beyond clinical care—it includes the patient’s complete financial experience from discussion of out-of-pocket estimates through to explanation of the patient’s payment responsibilities after insurance coverage is settled. The patient’s financial experience can have a disproportionately large impact on the overall experience and consumer rating. Healthcare organizations must incorporate financing solutions into the care delivery model to provide patient-centered care. One potential solution lies in adopting financing models that have proven successful in an industry where financing is the expected norm for consumers—the retail industry. 

A Retail-Style Approach to Patient Financing

While healthcare is unique in many ways, the need for financing options is not. In nearly every other consumer industry, from big box retailers to automotive to Amazon, financing is built into the purchasing experience—whether through upfront cost estimates, flexible payment plans, or proactive discussions about affordability at the point of sale. Think about it – go online to a big box retailer to size up new appliances, and you are likely offered 0% interest financing on the spot. Or getting a car repair diagnosis and the repair estimate is several thousand dollars along with attractive financing. It enables the purchase transaction and creates a loyalty program in one stroke. Healthcare providers must adopt a similar approach, integrating financing options into the patient journey much earlier in the process. 

A patient’s financial experience is just as critical as their clinical experience. Patients overwhelmed by costs are more likely to cancel or delay treatment, negatively impacting their health and provider revenue. Women, for example, often the primary healthcare decision-makers in their households, are particularly attuned to affordability and financing options. Many turn to social media, reviews, and online research before making healthcare decisions, emphasizing the need for a transparent and patient-friendly financial experience.

A digital-first approach can also improve patient satisfaction and engagement. Patients should have access to cost estimates, financing options, and assistance programs via their phones and tablets—just as they would when shopping for other services. By making the financial process more accessible and user-friendly, health systems can remove a major barrier to care while improving patient loyalty.

Retailers regardless of the product or service, if it’s a $500 or more purchase price (sometimes less), routinely offer financing at the point of sale, allowing consumers to purchase through installment plans or low-interest loans. Healthcare can benefit from implementing similar options, ensuring patients can access flexible payment solutions before, during, or immediately after receiving care. And be in a mind-set to continue with the next care episode. 

A patient-friendly financing approach does more than alleviate immediate financial stress—it also helps health systems retain patients. Fear of medical debt often leads patients to delay or cancel necessary treatments. By enabling patients to spread costs over time, health systems can improve patient satisfaction, engagement, and overall health outcomes.

Understanding the Patient Financial Journey: Key Touchpoints

The patient experience encompasses more than just clinical interactions; it also involves financial clarity. From scheduling an appointment to receiving a final bill, each touchpoint in the patient’s financial journey presents an opportunity to improve transparency and accessibility.

Here’s a breakdown of the patient’s financial journey:

• Scheduling: Patients should be informed of financing options when scheduling to help them plan for upcoming expenses. This helps establish a longer-term relationship and loyalty. 
• Pre-Treatment Discussions: Identifying financial assistance eligibility upfront can help prevent delaying or canceling care, which prevents unexpected financial burdens later. 
• Point-of-Service Financing: Offering flexible payment plans before or at time of treatment helps patients make informed financial decisions, and health systems to gain patient payments. 
• Billing and Collections: Clear communication about financial options reduces stress and minimizes the likelihood of unpaid bills. 

Health systems that integrate financing into these key touchpoints can improve payment collections, enhance patient trust, and reduce financial-related care abandonment. Early financing discussions also contribute to improved financial performance by reducing bad debt and increasing patient collections.

An Improved Patient Financial Journey in Action

Now, let’s revisit the financial fallout of serious medical care—but this time, through the lens of a health system that’s reimagined the patient financing journey and has implemented the retail-style approach. 

Jerry is a full-time long-haul trucker, married with two kids, earning $100,000 annually, and has no health insurance. When Jerry is diagnosed with stage 4 non-Hodgkin’s lymphoma, the prognosis is daunting. However, instead of facing overwhelming debt, Jerry’s care journey takes a different route because his health system has invested in a comprehensive, patient-centered financial access platform.

As soon as his diagnosis is confirmed, Jerry is connected with a financial advisor who guides him through the health system’s financing platform. He completes a brief screening application that verifies he is truly uninsured and confirms his income level and identity. While he earns too much to qualify for Medicaid, the platform helps him enroll in a health insurance plan through his state’s marketplace exchange.

But that’s just step one. Jerry also needs access to critical chemotherapy medications. Even with insurance, the 20% co-pay on a $20,000 drug would leave him paying $4,000 per dose. The financing platform automatically identifies and enrolls Jerry in a co-pay assistance program that reduces his out-of-pocket cost for the drug to $0.

From there, the system scans Jerry’s financial and clinical profile to match him with oncology-focused charity programs. These programs, often unknown to the general public, provide support for travel, hotel stays, and childcare—expenses that might otherwise delay or interrupt treatment.

Finally, with coverage in place and support programs active, Jerry is still responsible for $3,000 in other out-of-pocket costs over the course of five treatment cycles. Through the patient financing model, Jerry is presented with affordable monthly payment options, including a 0% interest plan that allows him to spread payments over 12 or 24 months.

Without access to affordable healthcare coverage, Jerry’s experience might have mirrored the single mother’s story—ending in overwhelming debt, damaged credit, and delayed care. Instead, even without insurance, Jerry is able to alleviate any financial stress and focus on what truly matters: his health.

The Financial and Patient-Centered Benefits of Patient Financing

When health systems prioritize patient financing, all stakeholders benefit. This translates to reduced patient financial stress and improved patient access to necessary care. For clinical providers, it means faster, more consistent payments and patients engaging in care at a higher level than without the means to pay for care. For the health system, it results in stronger revenue cycle performance with more patient revenue collected at service (versus chasing payments months after service), serving both self-pay-after-insurance and true self-pay patients with high degree of patient satisfaction, and achieving higher loyalty and net promoter scores. A timely and flexible payment model improves both health outcomes and hospital margins. Addressing financial concerns proactively leads to greater patient engagement, fewer canceled appointments, and better health outcomes.

Case Study: One Health System’s Approach to Patient Financing

For one of the nation’s largest health systems, with locations in throughout the Southwest, their implementation of a patient financing program provides a compelling example of how health systems can successfully integrate patient-friendly financial solutions. By providing financing solutions at multiple patient touchpoints and PAS leaders set application KPI’s for their team members to drive improvement.

The rationale for focusing on applications vs dollars transacted is simple; the team cannot control the creditworthiness of a patient, but they can control explaining our financial assistance options and allowing the patient to make their own decision.

Key results from the system’s financing initiative include:

• Increased point-of-service collections by $22 million in acute settings and $8.58 million in ambulatory settings in 2024.
• Processed more than 90,000 financing applications with a 93% acceptance rate.
• Provided zero-interest financing options, improving affordability and patient retention.

These results highlight the importance of moving beyond traditional billing and collections models. 

A Turning Point for Health Systems

The future of patient financing is here. Just as the retail industry has embraced digital-first, consumer-friendly financing models, healthcare must follow suit. Patients deserve access to care without financial distress, and health systems that support affordability will be best positioned to thrive. By integrating financing into the patient experience, healthcare organizations can ensure that financial barriers never stand in the way of necessary medical care.