Explore how patient financing can boost your patients' satisfaction and improve your practice's operations.
The financial burden of healthcare is preventing patients from getting the care they need. According to KFF, one in four Americans has difficulty paying for healthcare, while medical debt is a leading cause of personal bankruptcy filings. However, patient financing provides solutions to ease this burden through extended payment plans. This allows patients to pay over time rather than all at once.
Offering patient financing can benefit medical practices in several key ways. Today, we will look at how financing options can improve cash flow, increase access, boost patient satisfaction, provide a competitive edge, and reduce administrative burdens for your medical practice.
Improved Cash Flow for the Practice
Prices for inpatient healthcare services have nearly tripled over the past two decades, rising by 195% in the last 20 years. Prices for outpatient services have seen an even greater increase of 200% during these 20 years. With healthcare affordability posing significant risks to a medical practice's financial health, there is a growing trend toward patient financing programs.
Patient financing improves cash flow by reducing the lag time between service delivery and payment. How does it work? You get paid immediately by the financing company, while patients repay over an agreed-upon timeline. This means you have a consistent revenue stream and improved cash flow. Patient financing programs can reduce the burden of collections by ensuring that practices receive payments over time. This, in turn, can lower accounts receivable and boost overall revenue.
For instance, one medical center (Floyd Medical Center) that outsourced its patient financing and collections process saw a reduction in accounts receivable and an improvement in cash flow, which proved crucial during the COVID-19 pandemic. Also, Deaconess Health System reported a notable decrease in its internal patient debt load and a drop in delinquency rates after adopting a no-interest healthcare financing program.
At the beginning of 2023, a survey found that 61% of leaders from hospitals and group medical practices expected to see an increased reliance on third-party financing options in the next two years. By offering flexible payment plans moving forward, patients will be more inclined to accept recommended treatments and procedures. This will be especially beneficial for the 25.6 million uninsured nonelderly adults and the 61% who went without needed care in the past 12 months because of the cost.
Increased Patient Access to Care
Financing options make care more accessible by providing patients with flexible payment plans. Patients can get care regardless of their insurance status and break up expenses into manageable monthly payments instead of large upfront costs. For example, a patient who needs a $5,000 procedure but cannot afford to pay that amount upfront may be able to budget $200 in monthly payments over two years. This allows the patient to move forward with the procedure they need.
An increased level of accessibility can have several benefits:
- More patients can get the care they need when cost is less of a barrier. This includes important services like preventive care, chronic disease management, and necessary treatments.
- Earlier intervention is possible when patients don't have to wait to save up for care. This leads to better health outcomes.
- More patients opt to complete elective procedures when financing is an available option.
- More options for where to seek care, as patients aren't limited to low-cost community clinics.
- Reduced stress from medical bills and improved financial well-being.
Enhanced Patient Satisfaction and Retention
Providing financing options allows patients to access care they otherwise may not be able to afford. Patients highly value this convenience and peace of mind. When a practice offers financing, it shows patients that their needs are not being placed on the back burner.
Higher satisfaction leads to greater loyalty and retention. Satisfied patients are likelier to continue seeing the same provider over many years and recommend the practice to others. They have an emotional connection and trust, making them less likely to leave for another provider. Financing also increases the ability to accept treatment plans. Patients who can spread costs over time are more likely to move ahead with full treatment. This prevents situations where patients decline or delay care due to upfront costs.
Competitive Advantage
As patients pay a higher share of care costs, they are acting more like empowered healthcare consumers and shopping around for the best value. Did you know that over 70% of patients read online reviews before they make an appointment with a new healthcare provider? This means that patients are gaining a better understanding of the healthcare industry. They know what they need/want from healthcare providers.
Some of those things are flexibility and a healthcare provider that understands their financial concerns. Offering patient financing can give your practice an edge that attracts more patients. Practices that offer financing stand out by addressing patients' financial concerns upfront. This creates trust and shows the practice cares about the full patient experience. Patients feel empowered to move forward with the needed care.
As non-traditional healthcare providers gain ground, traditional providers must adapt to maintain their competitive position. Some medical practices are moving at a slow pace when it comes to offering online, self-service payment tools. While this can lead to less-than-ideal outcomes for those practices, this decision can open up bigger windows of opportunities for your practice to stand out because you are offering patient-friendly financing options.
With millions upon millions of Americans in healthcare debt, the need for accessible financing solutions is clear. As time goes on, practices without financing options may continue to struggle with higher rates of unpaid balances. Practices that do offer financing can lower the likelihood of non-payment from patients.
Reduced Administrative Burden
Dealing with patient collections, credit checks, and piles of administrative paperwork can be a massive headache. It takes up your staff's valuable time, which could be better spent on more meaningful work. But with modern financing solutions like payment plans, online payment portals, and billing applications with integrated collections, those mind-numbing manual tasks get automated. Streamlined processes can save your staff a significant amount of time and effort.
It's like getting an extra pair of hands to handle some of the administrative burden so your staff can focus on what matters. Financing reduces financial uncertainty and stress for patients, creating a better payment experience. Automation reduces manual paperwork and calls for collection. Online payment portals let patients manage their plans themselves, and EHR integration eliminates duplicate data entry.
BillFlash FlexPay: Healthcare Financing, Simplified
Offering patient financing is a win-win for healthcare providers and patients. It expands access to care by giving patients flexible options to pay out-of-pocket costs over time. For providers, it drives revenue through increased case acceptance, improves patient loyalty and competitiveness, and streamlines payments with steady upfront cash flow.
As healthcare becomes more consumer-driven, patient financing will be pivotal when it comes to attracting and retaining patients. Solutions like BillFlash FlexPay are helping to shake up the healthcare experience. With a 30-second application process, no hard credit checks required, 90% of applicants approved, and providers receiving full payment upfront, FlexPay makes accessing care easy for patients while ensuring providers get paid in full immediately, eliminating long wait times.
Schedule a BillFlash demo today to implement smarter patient financing at your practice.
*Account openings and payment activities are reported to a major credit bureau. Loans are made by Transportation Alliance Bank, Inc., dba TAB Bank, which determines qualifications for and terms of credit.