• Politics
  • Diversity, equity and inclusion
  • Financial Decision Making
  • Telehealth
  • Patient Experience
  • Leadership
  • Point of Care Tools
  • Product Solutions
  • Management
  • Technology
  • Healthcare Transformation
  • Data + Technology
  • Safer Hospitals
  • Business
  • Providers in Practice
  • Mergers and Acquisitions
  • AI & Data Analytics
  • Cybersecurity
  • Interoperability & EHRs
  • Medical Devices
  • Pop Health Tech
  • Precision Medicine
  • Virtual Care
  • Health equity

Medical bills are eating away at consumer health: How a patient-focused financial strategy can help | Viewpoint

Article

Consumers need a more sustainable path forward for managing the cost of care, and so will the healthcare organizations that serve them.

Paying for healthcare – without dipping into emergency savings – has become a crippling burden for many Americans amid the highest rate of inflation in 40 years.

Healthcare stakeholders need to do their part to address these patient financial barriers, Mark Spinner writes. (Image credit: ©jittawit.21 - stock.adobe.com)

Healthcare stakeholders need to do their part to address these patient financial barriers, Mark Spinner writes. (Image credit: ©jittawit.21 - stock.adobe.com)

According to a December 2022 survey of 1,000+ consumers, seven in 10 consumers say inflation has affected their ability to pay their medical bills. The survey also revealed 20% of consumers had to rely on savings to pay for healthcare expenses in 2022 alone.

These realities, sadly, have downstream clinical and financial consequences.

More than one-third of patients with outstanding medical bills have said they’ve deferred medical care, putting themselves at risk of developing more serious illnesses, including cancer and heart disease — which are also more expensive to treat the longer they go unchecked. Preventable chronic diseases like diabetes now account for the bulk of healthcare expenditures.

Also, when patients don’t pay for care in a timely way, either because they won’t or simply can’t, it jeopardizes the financial solvency of healthcare organizations. Rising bad debt, for example, sometimes forces healthcare organizations to take drastic measures to stay in business, such as cutting or laying off staff, which can negatively impact patient care.

Yet while there is no easy fix to inflation and financial stress, it’s becoming abundantly clear that consumers will need a more sustainable path forward for managing the cost of care—and so will the healthcare organizations that serve them.

Feeling pinched

The consumer survey offers significant insights into how inflation affects consumer spending decisions, including when it comes to their health.

One out of five consumers said they have relied on savings to pay for healthcare expenses in the past year, while 40% have used savings to pay for groceries. Nearly one in three, or 31%, borrowed from their savings to pay for utilities, and about one in four did so to cover their rent.

Meanwhile, 43% of survey respondents said a bill of $249 is the maximum they could manage with confidence, and just 16% said they felt confident they could manage a healthcare expense of less than $500.

While 47% of overall respondents said they expected to delay healthcare expenses in 2023, when the data was segmented by generation and race/ethnicity, the percentage was higher for Black Americans, Latin Americans, millennials, Gen Xers and families with children.

One in four adults said they’d planned to postpone preventative doctor’s appointments like annual checkups, while 18% said they would delay filling a prescription or opt not to fill it at all to save money. Twenty-seven percent said they would even avoid needed care or procedures this year.

As we learned during the first two years of the pandemic, these trends are red flags for our collective health and wellbeing. Consider that in March 2020 alone, appointments for screenings for cancers of the cervix, colon, and breast fell 86% and 94%, respectively. Unsurprisingly, in 2022, two-thirds of healthcare executives surveyed by said patient health and well-being are worse than they were pre-pandemic.

Back on track

Healthcare stakeholders need to do their part to address these patient financial barriers — and quickly. But often, their best-laid efforts aren’t aligned with patients’ real-life needs or preferences.

For example, most healthcare organizations still send out paper-based statements and bills, while fewer of us are opening our paper mail in a timely, consistent way. And while we’re more likely to change our mailing addresses than our mobile phone numbers, convenient, text-to-pay services are not the industry standard.

There are good reasons to rethink paper statements altogether. According to the consumer survey, 47% of consumers would switch providers to access affordable, long-term payment plan options were they offered. And, as a U.S. Bank survey noted, 31% of consumers would pay medical bills faster when notified by text or email.

Additionally, healthcare organizations can do a better job of accommodating patients’ changing financial situations and their anxiety around inflation by offering flexible payment plans.

One organization that adopted this approach, Atrium Health, saw an 8% decrease in bad debt. This approach, as well as efforts to improve patient financial communications by increasing pre-service discussions around out-of-pocket costs of care, helped raise the number of patients participating in a payment plan by 52% in one year.

Since then, Atrium has continued to expand its financial services offerings as well as its approach to digital patient financial engagement. Patients can now request estimates of out-of-pocket costs and connect with live support, when needed. Calls to customer service decreased 67%, and 30% of applications for payment plans have shifted to self-service, saving 102 FTE hours.

Moreover, providing a range of affordable payment options also demonstrates compassion, which is an even more important action step for revenue cycle teams during trying times.

Making the right moves for financial care

Healthcare organizations need to show, with their actions, that they empathize with consumers’ financial challenges and are willing to meet them at their level. A patient-first strategy for financial engagement during challenging economic times helps healthcare organizations and their patients weather the impacts of inflation, a recession, or a healthcare emergency.

About the author

Mark Spinner is CEO of AccessOne, a company that provides patient payment options.

Related Videos
Related Content
© 2024 MJH Life Sciences

All rights reserved.