Manual billing follow-ups are eating away at time, money, and patient trust. In this episode, we expose the hidden costs of outdated payment processes and reveal why automated reminders are one of the most powerful tools and how they transform healthcare collections. From reducing AR days and slashing mailing costs to freeing staff from endless follow-up calls, automation transforms healthcare collections into a smoother, faster, and more patient-friendly process. With stats showing 98% text open rates and payments received in as little as five minutes, the message is clear: meeting patients where they are—on their phones—creates happier patients and healthier cash flow.

Tune in now to learn how automated payment reminders can boost collections, cut admin waste, and create a better patient experience.

Transcript

Narrator: 00:00

Welcome to the Billing Blueprint Podcast, your go to resource for innovative medical billing solutions. Each episode we explore the latest industry trends and share proven strategies to help your practice streamline operations and get paid faster. Now here are your hosts, Brad and Sarah.

Brad: 00:20

Welcome back to the Deep Dive. Okay, today we're really getting into something that's, well, a massive operational headache for a lot of folks. Patient payments, specifically in healthcare. Yeah, we're looking at the challenge of collections, you know, and why just sticking with manual follow up is such a drain. It really eats up resources. So our mission today is to dig into the sources and figure out why these automated payment reminders are becoming so important. It seems like they're really changing the game for medical practices. 

Sarah: 00:52

Oh, absolutely. And that change, it's badly needed. The cost of not changing is just huge. I mean, one analysis we looked at suggested the healthcare industry could save something like $25 billion a year. 

Brad: 01:02

Wow, $25 billion. 

Sarah: 01:04

Yeah. Just by using automated payment reminders consistently. That gives you an idea of the scale. Right, the inefficiency we're talking about. 

Brad: 01:11

Definitely. And it's not really about like squeezing patients harder for money, is it? It's more about making the whole process smoother, easier for everyone involved. 

Sarah: 01:19

Exactly. Better for the provider's cash flow and frankly, a better experience for the patient. 

Brad: 01:24

So let's unpack this. We need to look at the hidden costs of doing things the old way, how patient preferences have shifted massively towards digital. And you know, how this automation actually works in practice. Okay. Starting with the operational side, if you work in a practice, you probably feel this pain. The sources we reviewed really lay out how inefficient the old methods are. Some stats are pretty eye opening. 

Sarah: 01:48

Yeah. Like this one. 78% of providers, they struggle to collect bills over $1,000 within 30 days. 

Brad: 01:56

78%. So the bigger the bill, the longer it takes. Much longer it seems. 

Sarah: 02:01

Right. And it's not just that the money comes in slow, it's the admin burden. It's constant. Think about staff time just spent checking on payment statuses manually. 

Brad: 02:09

Or printing and mailing statements over and over. 

Sarah: 02:11

Exactly. The sources found that just one manual status check costs on average $9.37. 

Brad: 02:17

$9.37. Just to check. 

Sarah: 02:19

Just to check. Now multiply that. Hundreds, maybe thousands of accounts, that adds. 

Brad: 02:23

Up incredibly fast pennies turning into, well, potentially millions across the industry. 

Sarah: 02:28

And it's wild how much paper is still involved. Get this. 88% of providers are still mainly using manual paper based follow ups. 

Brad: 02:36

88%? 

Sarah: 02:37

Yeah. 

Brad: 02:38

Wow. In today's world. 

Sarah: 02:40

Yeah. It creates this really long, expensive cycle. There's a big MGMA survey and it showed nearly half of providers, 40 mail three separate statements before an account even goes to collections. 

Brad: 02:53

Three statements. Think of the postage alone. 

Sarah: 02:56

The staff time Faulding, stuffing envelopes. 

Brad: 02:58

Yeah. 

Sarah: 02:59

It's no wonder that two thirds of providers, 66%, say patient receivables are a top revenue concern. It's a huge headache. 

Brad: 03:06

And all this admin work is not just a side cost, is it? 

Sarah: 03:09

No, not at all. It's actually become a massive part of the overall cost in hospitals now. Administrative overhead. It accounts for over 40% of the total cost of delivering care. 

Brad: 03:17

Over 40%. That's staggering. 

Sarah: 03:19

It is. It's a huge chunk that isn't just direct patient care. 

Brad: 03:22

And here's the other side of it, the part that really stings. Maybe this whole manual, often frustrating process, it actually hurts the relationship with the patient. 

Sarah: 03:31

Absolutely. The sources point out that 36% of patients said a poor billing experience would make them think about switching providers or. 

Brad: 03:38

Posting a negative review online. Right? 

Sarah: 03:40

Yeah. 

Brad: 03:41

Which nobody wants. 

Sarah: 03:42

Exactly. So that friction, that inefficiency, it directly hits patient loyalty and retention, which leads. 

Brad: 03:49

Us straight into this. This big disconnect, doesn't it, between how practices often handle billing and what patients actually expect now? 

Sarah: 03:59

Totally. We live in this instant world, right? You pay your mortgage on an app, order groceries from your phone, check into flights. It's all digital. Immediate. 

Brad: 04:07

Yeah. Click, click, done. 

Sarah: 04:08

But then you get a healthcare bill and it's like a confusing papal statement that shows up weeks late. It feels really outdated. 

Brad: 04:15

So patients want something different. 

Sarah: 04:16

Oh, definitely. The date is clear. Nearly half of consumers say they prefer electronic billing communications. 

Brad: 04:22

Okay. Nearly half. 

Sarah: 04:23

And drilling down, 62% specifically want payment notifications by text or email. They want something quick, easy, something they can deal with right away on their phone. 

Brad: 04:32

Makes sense. Less intrusive than a phone call, maybe. 

Sarah: 04:34

Right. And the effectiveness of these digital channels, especially text messages, is just phenomenal. Think about it. Texts have a 98% open rate. 

Brad: 04:43

98%. So basically everyone sees it. 

Sarah: 04:46

Pretty much guaranteed. Yeah. And here's the kicker. The average response time, about 90 seconds. 

Brad: 04:52

Wow. Okay. So people see it and they act on it quickly. 

Sarah: 04:56

Very quickly. 

Brad: 04:56

Yeah. 

Sarah: 04:57

And that translates directly to getting paid faster. One source found 32% of patients pay within five minutes of getting an electronic reminder. 

Brad: 05:05

Five minutes. That's a world away from waiting for a check in the mail. 

Sarah: 05:08

Exactly. Compare that to the old way, right? Voicemails Pile up, maybe get ignored for days. Paper statements end up who knows where. 

Brad: 05:15

In the recycling bin. Probably. 

Sarah: 05:17

Probably. But automated texts, emails, they meet people where they already are on their phones. It cuts through that inertia. 

Brad: 05:25

And there's a clear financial benefit too, right? Faster payments? 

Sarah: 05:28

Definitely. Hospitals using digital payments, they get paid 6.5 days sooner on average. Plus think about the savings on physical mail. Cutting mailing and postage costs by 20, 30%. That's significant. 

Brad: 05:40

Okay, so let's be really clear about what we mean by automated payment reminders. Yeah, what are they exactly? 

Sarah: 05:47

So basically they're pre scheduled alerts, usually text messages or emails. They get triggered automatically by certain billing events, like when an invoice is first created or when a due date is coming up. 

Brad: 05:57

And they follow a set schedule. 

Sarah: 05:59

Yeah, a consistent schedule. And crucially, they usually include a secure link so the patient can pay instantly right from the message. The key is the system. Does the follow up staff don't have to chase people down individually for routine reminders. 

Brad: 06:13

Takes that repetitive task off their plate completely. 

Sarah: 06:15

It frees them up. 

Brad: 06:16

And the benefits you mentioned earlier, they're not just small tweaks, are they? 

Sarah: 06:20

No, not at all. They're really transformative. We saw one example, a practice that implemented targeted outreach, including these automated reminders. They saw their monthly collections increase by $1.7 million. 

Brad: 06:32

Wow. 1.7 million a month increase in less than a year. 

Sarah: 06:35

Yeah, it happens because the automation consistently brings down the account's receivable days. You know, the time between sending the bill and actually getting the cash. 

Brad: 06:44

Right. Shortening that payment cycle. 

Sarah: 06:46

Exactly. And operationally, staff get hours back. Instead of making endless follow up calls or stuffing envelopes, they can focus on more complex patient issues or actual care. 

Brad: 06:57

Makes sense. And the cost reduction beyond postage? 

Sarah: 07:00

Well, less paper, less printing, less manual handling, it all adds up. But maybe just as important is the patient experience side. 

Brad: 07:08

Yeah, you mentioned that earlier. People prefer texts. 

Sarah: 07:11

Significantly, 59% prefer getting a text about a bill instead of a phone call or a mailed statement. It feels less confrontational, more convenient, maybe even personalized, like hello, bill, your invoice is due. It's just more approachable. 

Brad: 07:25

So a good system isn't replacing customer service, it's actually improving it in a way, making it more modern. 

Sarah: 07:31

That's a great way to put it. It aligns the service with how people live now. 

Brad: 07:34

Okay, but if a practice is thinking, alright, this sounds good, the details really matter, right? How do these systems actually work? What features should they look for? 

Sarah: 07:42

Absolutely. Security and control are Huge. You want a system where the practice can set the rules, like maybe limit reminders to three per month, mix of text and email. But the system handles the actual sending reliably. 

Brad: 07:56

So customizable but automated. 

Sarah: 07:58

Right. And a really critical feature, something essential for keeping patients happy, is the automatic shutoff. 

Brad: 08:05

What do you mean? 

Sarah: 08:06

Once a patient pays their bill, the system must automatically take them out of the reminder sequence immediately. 

Brad: 08:11

okay. So they don't get another reminder after they've already paid. 

Sarah: 08:15

Exactly. That's a super common frustration with manual systems. Right? Getting chased for a bill you settled days ago. Automation prevents that nightmare scenario. 

Brad: 08:23

Yeah, that would be really annoying. And what about security, clicking links and texts? People are wary. 

Sarah: 08:29

And they should be. That's why any message has to link to a truly secure online payment portal. You need rock solid compliance. We're talking PCI standards for protecting card data and of course, HIPA for patient health information. 

Brad: 08:42

So the patient needs to feel confident that clicking that link and entering their details is safe. 

Sarah: 08:47

Absolutely crucial. That trust factor is key to getting them to actually click and pay right then and there. 

Brad: 08:53

Okay, so let's say a provider implements this. What does that reminder schedule typically look like? You mentioned consistency is key. 

Sarah: 08:59

It really is. That steady drumbeat is what drives down those AR days. Now, it's usually customizable when they set it up, but a really common effective pattern we see in the sources goes something like this. 

Brad: 09:11

Okay. 

Sarah: 09:12

First reminder often goes out about seven days after the initial statement is sent. 

Brad: 09:16

Or generated a week later. Okay. 

Sarah: 09:17

Then if the bill isn't paid, a second reminder might go out seven days after that. So at the 14 day mark and maybe a third one at 21 days, it's that regular automated nudge that keeps the bill top of mind without staff having to manually track every single account. 

Brad: 09:32

Consistent, but not overwhelming. 

Sarah: 09:34

Exactly. And this kind of approach works across the board, really. Dental practices, medical groups, vision providers, even big medical billing services or municipalities collecting fees. Anyone who needs predictable revenue benefits from replacing that manual inconsistency with reliable automation. 

Brad: 09:52

Okay, so wrapping this up, what's the main thing listeners should take away from this deep dive? 

Sarah: 09:57

I think the cool message is that automated reminders aren't just a nice to have tech feature anymore. They're probably the single most powerful tool available right now to significantly boost collections and cut down that operational drag. 

Brad: 10:11

And it does this by aligning with how patients actually want to interact these days. 

Sarah: 10:15

Right. 

Brad: 10:15

Using digital channels. 

Sarah: 10:17

Precisely. It's about meeting them where they are, making it easy and secure. The impact is structural. You get consistency replacing delays which smooths out cash flow, frees up staff, and importantly makes the whole experience better for the patient. It's kind of a win, win. 

Brad: 10:34

Yeah, it really sounds like it. 

Sarah: 10:35

Better cash flow, less admin waste, happier patients. 

Brad: 10:38

So here's a final thought for you, the listener, to consider if automating something like payment reminders, which seems pretty administrative on the surface, can have such a big impact on finances and patient satisfaction. Where else in your day to day operations, your standard workflows might a similar small, consistent dose of automation unlock surprising savings or improvements? Something to think about. 

Narrator: 11:00

Thanks for tuning into the Billing Blueprint podcast. For more insights or to dive deeper dive deeper into today's topics. Head over to billflash.com. Don't forget to subscribe and we'll catch you next week with more strategies to keep your practice running smoothly and getting paid faster

Sources:

Boost Collections Without Lifting a Finger: The Power of Automated Payment Reminders