Close to half of patients postponed procedures and treatment in 2020 because they couldn’t afford it.
The financial experience in healthcare significantly impacts patient decision-making, the quality of care they receive, and adds additional distress to an already vulnerable situation.
“Patients need a seamless financial experience that alleviates the stress of medical expense by proactively taking into account their financial status and providing them a real path forward for payment,” says Michael Strickland, VP of product at Flywire.
Below, Strickland describes how omnichannel engagement integrated with digital payment solutions can deliver a more personalized and empathetic experience for patients that is easy to use, stress-free, and affordable.
Q: The current billing and payment process for healthcare can often exacerbate an already stressful situation for the patient. Digging deeper, what elements make the patient’s financial experience so stressful today?
Strickland: We think about patient distress in a few different ways. First, there is pure financial stress. The data tells us that roughly 50% of Americans can't afford to pay an unexpected $400 medical expense. The majority of healthcare bills we see on our platform are much higher than that amount. This financial stress is compounded by daunting medical bills and healthcare providers’ traditional payment methods, such as one-time payments or short-term interest-free payment plans, that may not work for patients. The front-end pre-service experience is also distressing due to a complete lack of transparency around healthcare costs. Patients need to understand up front what they will be paying for their medical care and what financial options are available to them. Recently, my wife gave birth to our first son, and there was no indication of how much this would cost, how much insurance would pay, and when we would receive a bill. I was left anticipating a bill ranging from $500 to $5,000. For patients, this is a significant impediment to even scheduling an appointment to receive care.
Q: How can technology bring greater empathy into the process and help alleviate the stress around the financial experience?
Strickland: In a digital experience, empathy can mean a lot of things. The first priority should be to know the patient. If you want to empathize with somebody, you need to imagine yourself in their shoes. Digitally, this means learning how the person likes to be engaged. For example, do they prefer text or email? Do they want you to connect with them on weekends or weekdays? Second, it also means learning a person’s capacity to pay, which allows organizations to personalize the payment journey and recommend the best option.
Third, healthcare providers think they know a lot about how patients want to engage and handle their financial journey, but part of being empathetic also means constantly checking in and asking for patient feedback on how you are doing. One of our large health system customers has successfully used technology to boost empathy and a patient-centric mindset. They have created a patient persona with a set of tangible patient characteristics that helps them understand how patients like to be engaged. We have worked together to take the surprise out of the billing experience. Now, every patient gets an estimate at the point of service and a personalized payment option to pay that estimate.
Q: How does better engagement improve this process?
Strickland: Meaningful engagement is critical and involves using all available methods intelligently, including paper, email, text, chat, and phone conversations, to drive positive business outcomes. Healthcare organizations can use predictive analytics and omnichannel engagement to learn, for example, that a particular patient likes to be engaged by text on weekdays before dinner. This adaptive conversation can be mapped onto an empathetic digital experience that informs the rest of the communication with the patient, allowing them to have the experience they want, including a flexible payment plan. Ultimately, predictive analytics and omnichannel engagement help healthcare organizations determine what to send to patients and when to send it to improve patient satisfaction, collection rates, and other billing outcomes.
Q: What are the best ways to inspire patients and encourage self-service?
Strickland: Qualitative and quantitative research indicates that patients are motivated to use self-service. They typically require assistance only when the billing experience is ineffective. It’s important to internalize this ethic and then build an experience that makes it as easy as possible for patients to handle their own payments. Start with big ideas such as getting patients into the financial experience as fast as possible. For example, offer a point-of-sale transaction that is seamless and doesn’t involve account setup and activation. Run constant user experience tests for feedback on the quality of the experience. This ethic will guide your pursuit of creating an easy experience. Finally, work with staff and providers to understand why people are picking up the phone. Is it a preference, or is it because they ran into a problem with your site? Healthcare organizations can expect to see 90% self-service adoption when using these methods with the right digital platform.
Health systems are making significant progress in transforming the patient financial experience, leveraging digital innovation to give patients more engagement options and payment plan choices.
“Creating a successful consumer financial experience in healthcare requires constant optimization to make processes as simple and transparent as possible,” says Tomer Shoval, SVP sales, strategic accounts, and business development at Flywire.
Learn from Shoval the history of innovation in the patient financial experience space, what makes a health system innovative, and his advice to those looking to begin their digital transformation journey.
Q: You have been a leader who has brought greater levels of consumerism into the healthcare financial arena, having experienced the need firsthand. Can you share the story of how you got into this space?
Shoval: I was on a company's core team that built the first largest shopping comparison engine during the internet boom. Solving consumer problems in a meaningful way was an incredible journey, and I never thought I would leave that space. However, after a weeklong trip to Mexico that was supposed to be a fantastic vacation, I changed my mind. My entire family became very sick, and the trip turned into a nightmare. When we arrived back home, an ambulance took my daughter and me to the hospital. Two months after our recovery, my wife and I faced a pile of paperwork, including 'explanation of benefits' forms and medical bills. It was a stressful and cumbersome experience because of the volume of paperwork and phone calls that weren't answering basic questions such as, "What is our balance?" and, "Why do we need to pay for this when we have insurance?" That was the moment it hit me that the system was broken, and someone needed to fix it.
While I didn't have healthcare experience, I knew a lot about the consumer experience and the technology required to build a successful e-commerce platform. I co-founded a company that created a healthcare technology platform that optimizes digital payments and the patient financial experience. We were able to show providers that patients want the same experience in healthcare that they have when they book a hotel or buy something on Amazon. Phone calls and paper no longer work. In early 2020, we joined forces with Flywire, and the timing is perfect—consumer-driven healthcare has ramped up, and people are starting to pay a lot more attention to their healthcare expenses.
Q: There has been a deep history of innovation in the patient financial experience field since it began. What are some of the more significant advancements that helped change the face of financial care?
Shoval: When I look at the financial experience field, there have been three significant waves of innovation. The first acknowledged that patients are consumers who prefer to take action on their own at their convenience and by computer or mobile phone. The patient's financial experience was straightforward and didn't require a patient to have a paper bill with an account number. Instead, patients authenticated their accounts online. During this era, the percent of patients paying online jumped from nearly 10% to 80%.
In the second wave, providers focused on different ways to engage with patients through digital methods of communication, including text, chat, email, and phone. Patients were allowed to access their accounts through a portal with a single sign-on or a provider app.
The most recent evolution has been applying machine learning and data analytics to create personalized experiences for the patient. These technologies tailor the financial experience to the patient's specific needs accounting for preferred methods of communication, the patient's capacity to meet their financial responsibility, and the financial options available to them based on that capacity-to-pay. Consider Netflix and Amazon Video; they use data and algorithms to know what you like and tailor the experience to you, creating different experiences based on your personalized preferences. We can do the same when it comes to billing and engagement with patients.
Q: Having worked with so many health systems to create a better financial journey for their patients, are there any commonalities between them? What makes an innovative health system?
Shoval: We work with many large health systems whose leaders are setting a new tone of innovation and consumer financial engagement. They are not afraid to create and execute a new vision, and they are data-driven and constantly looking at results. Successful providers also realize that having a top-notch clinical workforce is no longer enough to attract and retain patients. As a result, they are turning the patient financial experience into a competitive advantage in their markets.
Q: What advice do you have for health systems looking to innovate and bring this type of consumerism into their own financial experience?
Shoval: It starts with building leadership teams who thrive on change, are focused on the future, and constantly seek to create a better consumer experience. These organizations must look at everything they do and challenge themselves to figure out how to modernize and digitize the patient financial experience to stay in front of consumer trends. They should also look at the success factors of other health systems that have been early adopters in the patient financial experience movement. At the same time, hospital leaders are busy, so it doesn’t make sense to do everything on your own. Look for a partner with the right capabilities, including one that will develop a roadmap that covers pre-service to post-service, integrate with other partners, and help connect all the dots in your vision.
According to a recent survey, 84 percent of U.S. consumers say there needs to be a more streamlined payment system for healthcare, while 40% say they have missed a medical bill due to a complex payment system.
“When it comes to their financial experience, patient expectations are changing,” says John Talaga, EVP & GM of Healthcare at Flywire. With the average hospital bill nearly $1,000, Talaga says it is no longer enough to create an online payment portal.
Below, Talaga explores four ways hospitals can create meaningful financial interactions with patients.
Q: You have stated there are four key elements for driving a true financial journey for patients. Can you share them?
Talaga: Yes, but first it is important to understand that an affordability crisis is driving the healthcare consumer’s financial journey today. Patient liability now comprises a much greater share of a hospital’s overall net patient revenue due to high-deductible health plans, which is causing some consumers to avoid care altogether. Downstream, this also impacts a provider’s ability to collect. Unfortunately, the pandemic has accelerated the problem and is driving a new level of urgency for hospitals to address the patient financial experience.
The first step in optimizing the patient’s financial journey is to modernize the payment experience and make it easier and more affordable for patients to pay. Hospitals need a software platform that uses AI and machine learning to aggregate patient data across the network, including demographics, historical payments, and external data such as credit bureau information and credit-to-debt ratio. This technology is critical for predicting a patient’s capacity to pay.
Second, it is essential to personalize each patient’s financial experience. This is achieved by identifying patient conversation profiles and engaging patients in the manner they prefer to interact, including by email, text, chat, or even paper. The third principle involves matching each patient’s capacity to pay with their conversation profile and a financial offer that is tailored to their needs. Lastly, providers should complete the machine learning loop by measuring outcomes. For example, did the patient pay in full, did they need a payment plan, or did they default? All these things inform the next interaction.
Q:The biggest roadblock in the patient’s financial journey is the ballooning cost of care. How do the four principles help solve this problem?
Talaga: Consumers typically do not budget for healthcare services. On top of that, almost half of Americans can't pay a bill in one lump sum. Given that patients are now paying nearly 30 percent of overall charges compared to just 10 percent a decade ago, taking a one-size fits-all billing approach and just sending a bill isn't going to drive collections. The four principles address these concerns by automating and personalizing the patient’s financial journey upfront. During registration, a hospital can leverage a machine learning platform to offer personalized payment options to patients. This makes it easier for patients to pay in advance and helps them feel more comfortable that they have the right payment plan before they receive care. We call it patient-friendly billing 2.0. Helping patients understand what they owe and offering them personalized payment options increases their capacity and willingness to pay.
Q: Meeting patients with the right message in the right place at the right time is almost as important as the offer itself. How can hospitals leverage digital engagement to drive adoption and payments?
Talaga: We recommend hospitals adopt a sophisticated digital financial engagement strategy, leaning heavily on analytics and advanced engagement technology such as omnichannel. It’s really about using machine learning to monitor different modes of patient communication and understanding the type of messaging that works best for each patient. Having a frictionless and mobile first design is also critical. For example, frictionless design could mean sending patient texts or emails with pre-authenticated links to reduce log-in complexity. Pre-authenticated links help hospitals understand where patients are coming from while removing barriers to make it easier for patients to make a payment when they get to the site.
Q: Can you share a client story that helps illustrate where these four principles have come together to create a better financial journey for patients?
Talaga: We recently helped a $28 billion IDN improve the patient financial journey by standardizing patient billing across 100 hospitals in five markets with five different EHRs. This organization was managing patient billing in a traditional way, sending statements every 30 days. They had different online experiences and statement designs and were not using text or mobile to engage patients.
Applying the four principles we created one standardized payment platform across all markets and EHRs, applying analytics and offering patients different modes of communication, personalized payment plans, and a consolidated financial experience. Patients now receive one bill per month with one balance. The results have been incredible. Our client has seen a significant increase in patient payments, going from zero to more than 80 percent of patients using self-service payment plan activations. Patient satisfaction also increased dramatically. Importantly, health system leaders say the new system’s flexibility to adapt rapidly was critical in helping patients experiencing financial strain during the pandemic.