Healthcare Patient Financing
Over the last decade, there has been an increase in patient out-of-pocket medical expenses as well as an increase in self-insured employer plans. This has left patients with little to no choice but to pay more to cover their medical expenses. In many cases, there is a large gap between the amount required for medical treatment and what the patient is able to pay. When patients lack available funds to pay for medical expenses there are alternatives such as patient financing or medical loans.
What is Patient Financing?
It is impossible to put a price on one’s health and wellbeing. When it comes to paying for necessary medical procedures or treatments, understanding what options are available and how to access patient funding is critical. Patient financing is the arrangement of funds the patient is approved for by a lender to help pay for out-of-pocket medical expenses. Often, patients are unable to pay for the entire balance for medical treatment or within the time required by the healthcare provider, which is where patient financing comes in. It works by offering patients medical loans with reasonable payment plans and flexible payment terms, which enables the patient to receive proper treatment and care immediately without having to pay the healthcare provider all at once. Patient financing offers payment plans that allow the patient to make monthly installments until the balance is completely paid off for a nominal interest fee similar to a credit card.
How does Patient Financing work?
Patient financing is offered to patients by a lending partner that works with the healthcare provider (hospitals and physician practices) when the patient doesn’t have the full amount to cover their out-of-pocket expense. Healthcare providers offer this as a value add for patients who have financial constraints to avoid delaying medical treatment.
Patient financing has become increasingly popular due to estimates provided to patients for high-cost surgeries and treatments, which provides pricing transparency to the patient. When patients have pricing transparency upfront, it shows that the healthcare provider cares not only about the health of the patient, but also their financial wellbeing. This process increases patient satisfaction and pays the provider quickly for their services.
Lending Partner Patient Financing
Offering healthcare financing can benefit the well-being of patients and increase revenue. Patients can receive the treatment they need on time, and the provider gets timely payments as well. Having a plan to help patients pay for their treatment is good business for the healthcare provider. The cost of losing a patient to another healthcare provider offering patient financing can be avoidable. When healthcare providers have a financing partner, there is an opportunity to increase their patient volume while strengthening their provider-patient relationship.
Some providers try to offer in-house patient financing, which creates exposure and unnecessary financial risk for the healthcare provider if the patient does not pay their open balance. The back and forth with collection efforts can also negatively impact the relationship between the healthcare provider and patient. This creates more work for the Revenue Cycle Management Department (or Providers Billing Department) and increases staff overhead to manage patients who become delinquent or can’t pay their open balance. The Billing Department allocates a significant amount of time and resources to collecting open balances that are overdue and at times never collected. When paired with a financial engagement strategy, technology, and a Patient Financing Lender, the Billing team can optimize their collection efforts.
For healthcare providers, there are considerations in finding the right patient financing lending partner. There are more options to choose from these days and finding the right lending partner should meet several basic requirements to ensure a successful program that benefits both the patient and provider. When evaluating a lending partner, providers should consider the following criteria.
Lending Partner Considerations
- Direct Lender or Lender Pool: Traditionally, there were only select banks that offered patient financing. This often limited healthcare providers with a single source lender who dictated their terms because there were few in the market. With new lending programs and technology, it is now possible to offer a program that delivers the best solution from a pool of lenders to always obtain the best interest rates.
- Tech Savvy Medical Lenders: When selecting a lending solution, it is helpful to have the appropriate experience and technology when working with hospitals and physician practices. This offers tangible benefits for ease of business and tailoring patient lending programs for healthcare providers. Innovated lending providers understand the medical billing process and offer complimentary technology solutions to help streamline the patient payment process.
- Payment Portal & Integration: In the world of consumerism and automation, having your payment solution integrated within your payment portal is invaluable. Not only is it convenient for the patient to fill out the required information, but once the payment is approved the funds can be easily integrated back into the healthcare providers financial system taking away the effort to manually post the payment.
- Security & Compliance: Any lending partner considered should provide the highest level of security and compliance. At minimum, both HIPAA and PCI compliancy should be part of their offering.
- Integrity & Support: If a healthcare provider or patient has a question or needs help, the ability to obtain timely support 24×7 is critical to the success of the program. Patients and providers should also be able to access real-time support as needed.
At HiLiteMD, we offer a Payment Portal platform that includes patient financing options with a pool of select lenders who offer the best rates for patient financing. We continuously evaluate the market for the best patient lending options and help healthcare providers with patient financial engagement. HiLiteMD’s Payment Portal platform provides seamless integration with current clinical financial systems and uses Robotic Process Automation (RPA) to maximize the value for automated billing workflows. As a vendor agonistic provider, HiLiteMD connects seamlessly to PM/EMR systems and is a security-first cloud platform (HIPAA & PCI Compliant) that removed onsite vulnerability and risk from IT exposures. We partner with Hospitals, Surgery Centers, Physician Practices, Employers, and Healthcare organizations to decrease their overall expenses, provide timely options for payment as well as provide expert support.