Top 5 Reasons to Offer Flexible Payment Plans for Patients
Medical costs can quickly add up and can become overwhelming, even for the patient with health insurance coverage. High deductibles, co-insurance and uncovered services can rapidly grow into a large balance owed. At the same time, nearly 70% of patients have less than $1,000 in savings to pay these expenses, leaving a gap between what patients can afford and the amount due.
Medical practices want to help their patients stay healthy, but at the same time, they must ensure that the business is financially stable and collecting on receivables. Flexible payment plans help close the gap between what patients owe and what they can afford. Check out these five reasons why medical practices should consider offering flexible payment plans.
1. Patients are more likely to pay bills
A small medical bill is overwhelming to the patient already struggling to meet existing financial obligations. Patients don’t pay medical bills for a variety of reasons. They may not have the cash on hand, they’re worried about billing errors or they don’t understand why the insurance didn’t pay more.
A recent survey found that out of the patients who use payment plans, 76% reported they would complete all payments on time. Payment plans allow practices to work with patients to clear up confusion about bills and then create a plan that works within the patients’ budgets while improving patient experience.
2. Increased patient satisfaction
Patients with high-deductible insurance plans often struggle to pay their portion of the bill. These deductibles can range from $1,000 up to several thousand dollars, which is an overwhelming amount for some people. Empowering patients with solutions to solve their financial challenges quickly increases patient satisfaction.
Over half of patients (65%) reported they would consider switching providers for a better experience with payments. Flexible and personalized payment options allow people to select a plan that fits their budget, which drives up satisfaction with your practice.
3. Ability to open up your practice to more patients
Practices are collecting more of their revenue directly from patients than they did in the past. Medical spending for people with employer-provided health insurance has increased by over 50% since 2010.
Offering flexible payment plans allows you to open the doors to more people who need medical care. They can visit your practice knowing that flexible payment plans allow them to pay for services without exceeding their budgets. Select a program that allows for 100% inclusion, and you won’t turn any patient away due to credit history.
4. Increase growth and revenue
Cash flow is a critical challenge for most practices. Even if a practice is earning well, slow receivables and bad debt can quickly create financial strain. Delinquent accounts depreciate at a rate of 0.5% daily, and for each month that passes, 15% of the value of your A/R vanishes.
Flexible payment plans allow your practice to get paid faster with tools designed to speed up payment cycles. Some plans allow you to get paid up front on receivables, which further improves cash flow.
Work with a partner that provides payment plan options through the technologies that patients already know and enjoy. For example, you can send a patient payment details via their smartphone, and if they can’t pay the balance at one time, they can easily set up ongoing payment options using the same platform.
5. Patients are more loyal
Offering patient payment plans is a way to encourage patient loyalty, repeat business and referrals. One report showed that about three out of every four consumers (76%) consider the billing and payment process “somewhat” to “very” important when evaluating a new medical practice. Patients want a simplified experience, cost transparency, and tools and resources to manage their bills from medical practices.
At the same time, patient expectations are increasing, but patient satisfaction is lagging. In fact, over one third of patients (34%) reported that a difficult or unorganized billing and payment process would prevent them from seeking further care.
Offering an upfront and transparent billing process, enhanced patient financing services, and the ability for patients to easily sign up for a payment plan fosters greater loyalty. As a result, patients will feel more comfortable referring their friends and families.
Moving into the future
Financial responsibility is increasingly shifting from the insurance company to the patient. Helping patients understand their financial responsibility up front is a good first step, but by itself, it’s not enough.
Patients need solutions that help them manage that shifting financial responsibility and do so in a way that doesn’t create financial stress. Personalized and flexible payment plans allow practices to bridge this gap and get more patients access to the care they need most.