June 21, 2021

How to Use Price Transparency to Your Advantage

The cost of healthcare falls more on patients today than it did 10 years ago and, now, amounts to 35% of provider revenue. This rise in patient responsibility has created new challenges for healthcare organizations as consumers become more aware of their costs.

Price transparency rulings, in effect since January 1, 2021, were intended to create competition in healthcare. Now, consumers can get estimates on their total costs before scheduling an appointment. Consumers can shop for the best prices on some services, creating an exit point in the patient journey and the potential for lost income.

However, these challenges present new opportunities for healthcare organizations. It starts with shifting your collection strategies from post-service to pre-service and point-of-service payments. You must meet the patients where they are and give them the experience they want.

Revising your revenue cycle is critical, and you must reimagine it with your patients in mind.

“A lot of times, you get the service first, and then, you pay after. But in all those cases you get a price. Healthcare is the only one you don’t often know the price.”

New Demands Mean Healthcare Needs Pre-Service Payments

Price-conscious consumers should mean you look at this as a retail model. Like how consumers search for the best car price, they now look for the best price for imaging services. These and other shoppable services become points where you can lose revenue to competitors.

Your consumers want good, reliable estimates, and you should want to give estimates to your consumers. Research has shown:

40% of people don’t understand charge details and what you’ve billed them
32% of people didn’t follow up after a visit because of an outstanding bill
67% have received a medical bill they couldn’t pay in full

HFMA research shows that 74% of people are willing and able to pay up to $1,000 per year. However, poorly designed, complicated or badly delivered billing communication surprises 60% of those patients with unexpected, inconsistent or unclear healthcare bills.

“Two analogies are restaurants and car repairs,” explains Howard Bright, VP of Patient Engagement at RevSpring. “A lot of times, you get the service first, and then, you pay after. But in all those cases you get a price. Healthcare is the only one where you don’t know the price.”

Engaging the Consumer During the Patient Journey Opens Up Pre-Service Payments

Engaging with your consumer where they are, using their tools, makes it easier for you to communicate with them. Also, it helps improve their overall experience with your organization. The importance of a digital strategy cannot be overstated.

Often called a digital doorway, this strategy creates places where consumers can interact with your organization. Digital doorways in healthcare provide a convenient, comprehensive bridge between patients and providers, encompassing every aspect of the healthcare experience.

Patients want these options, too. For a healthcare organization, though, a digital doorway strategy can bring a lot of benefits:

30% reduction in engagement costs
95% attendance rate when patients confirm appointments digitally
20 times more engagement with OmniChannel communications

Make sure your digital doorway strategy has modern payment capabilities. Options like Apple Pay, Google Pay, Venmo, text-to-pay and a secure card on file give more options and convenience to your consumers. If you ask for payment early in the patient journey, you can reduce your days in AR and your bad debt.

Your patients want these options, and they want to understand what their money is paying for before they get service from you. It’s a winning strategy.

Making a Case for Pre-Service Collections

Pre-service and point-of-service payments make an impact on your revenue cycle. Research shows pre-service and POS payment strategies can reduce bad debt by 4%. You can realize these benefits, too. Find out how in our live webinar.