September 19, 2024
Riding the Digital Surge: The Evolution of Payments in Healthcare
This article continues our series with Zeal, where we focus on the trends shaping healthcare today. You can read their contributions to this series here.
A recent survey shows that 78% of consumers prefer digital payment methods. Yet, only 45% of healthcare providers are equipped to meet this demand. This gap isn't just a missed opportunity; it's a risk. Patients are no longer willing to endure the inefficiencies of paper-based billing and manual payment processes. They want the ease and speed they experience in other areas of their lives—whether it's shopping online or checking their bank account.
As healthcare costs continue to climb, the burden on patients is growing. In 2023, premiums for employer-sponsored health plans jumped by 7%, bringing the average annual cost to nearly $24,000. The average family deductible under high-deductible health plans (HDHPs) has soared to $4,705. These rising costs are pushing patients to seek more flexible payment options, such as payment plans or digital wallets, making managing these expenses easier.
For healthcare providers, the transition to digital payments is not just about meeting patient expectations—it’s a matter of operational necessity.
Since 2021, labor costs in healthcare have surged by 16%, straining the financial resources of many providers. This increase, coupled with ongoing staffing shortages, forces providers to find efficiencies wherever they can. Digital payment systems offer a straightforward way to reduce administrative burdens and improve cash flow. By automating billing and payment processes, providers can cut down on manual errors, speed up collections, and free up staff to focus on what they want to do: help patients.
Making the most of the revenue cycle is vital for healthcare providers with tight budgets. Effective RCM can reduce the number of days bills remain unpaid, improve cash flow, and make sure that providers have the resources they need to continue helping patients. Digital payments play a key role here, offering real-time payment tracking and automating many processes that traditionally impede RCM.
Embedded finance is the future of healthcare, offering patients more ways to pay and providers more ways to collect.
The healthcare industry is seeing a 23% annual growth in digital payments. This surge is driven by the adoption of embedded finance solutions, which include mobile payments, real-time payments, and Buy Now, Pay Later (BNPL) options. These solutions are not just convenient—they are necessary for meeting the needs of patients burdened by high healthcare costs.
Many Americans find financial stress a significant barrier to accessing healthcare. More than 50% of consumers report struggling to afford healthcare, with 33% carrying medical debt and 40% delaying or skipping care due to costs. Embedded finance solutions like BNPL offer a way to ease this burden by allowing patients to spread out their payments over time. This approach not only helps patients manage their expenses but also reduces the risk of bad debt for providers.
Pay Theory is committed to helping healthcare providers navigate this digital transformation with practical and flexible solutions designed with providers and patients in mind.
We offer a wide range of payment options, including payment plans and remote cash acceptance. These options ensure that all patients can pay in a way that fits their financial situation, whether or not they have access to traditional banking services.
Pay Theory’s solutions integrate smoothly with existing healthcare platforms, supporting new billing codes and guaranteeing compliance with regulatory standards. This integration not only simplifies the payment process but also improves security, protecting both patient data and provider revenue.
By optimizing revenue cycles and reducing administrative burdens, Pay Theory’s digital payment solutions help providers stay financially resilient in a challenging environment. Our tools are designed to improve cash flow, reduce the time it takes to collect payments, and ensure that providers can focus on what they do best—caring for patients.
The shift to digital payments in healthcare is more than a trend—it’s a real change in how the industry operates. Offering providers access to these technologies is crucial for improving patient satisfaction, simplifying operations, and maintaining financial health in an increasingly complex industry.
To learn more about how Pay Theory can help your platform integrate complex digital payments, visit our healthcare page or contact our team today.
