Waystar, a provider of cloud-based revenue cycle technology has released an industry survey examining today’s state of the patient financial experience. In the first half of 2019, Waystar surveyed 1,000 consumers about their last hospital encounter and their experience with the hospital business office. The study, “The Patient Financial Experience: Consumer Attitudes and Behavior,” reveals that the biggest barriers to a positive patient financial experience are lack of understanding around pricing, insurance coverage and complexity of medical bills.
The research reveals 3 key patient financial experience trends to follow in 2019 and beyond:
1. Pricing transparency is important, but healthcare financial literacy is the missing link
Frustration with healthcare’s pricing failures has hit a boiling point, and new legislation is aimed at addressing the lack of transparency in the industry. But price transparency alone does not guarantee that patients will be able to make informed and responsible medical decisions; the missing link is healthcare financial literacy.
Waystar’s survey shows that a quarter of patients find pricing too complicated to understand and a third don’t even know that prices vary. When asked about a recent planned or routine medical procedure, only about one in 10 patients compared costs across multiple providers in advance.
2. Younger generations are hit the hardest by medical bills
Medical bills and associated debt are a growing concern population-wide and Waystar’s study finds patients between the ages of 18 and 39 are hardest hit, with more than one in three choosing to delay or forgo care to keep bills at bay. “Surprise billing” plays a significant role here: when asked about their last medical procedure, one in three patients said the amount of the bill they received was more than expected.
Key findings show:
– Over a third (35%) of respondents owed at least $100 out of pocket after their last treatment, 8% owed between $500-$999, and 7% owed between $1,000-$5,000.
– The youngest are least aware of their cost burden, with a third not knowing their balance, while older patients tend to have the smallest bills.
– 92% of respondents said that the amount they had to pay for their last medical procedure was more than expected.
– 75% of respondents under 65 didn’t expect to pay anything.
3. Impact of Paying for Medical Bills on Other Financial Obligations
Majority of patients (65%) never had to prioritize paying for healthcare over other expenses, but 82% of those are 65+ so it can be assumed their healthcare is fully covered by Medicare
4. Younger patients are twice as likely to prioritize healthcare over other expenses.
More than a quarter of respondents have had to forgo a procedure or treatment that would have helped their quality of life due to cost.
• Those between 18-39 years were most likely to forgo treatment (76%)
• Roughly 55% of 18-23-year-olds have prioritized medical expenses over other expenses vs. only 18% of 65+-year-olds
5. For revenue success, hospitals need to customize patient financial encounters
While the ability to pay a bill is the biggest issue at hand, the data reveals that customized patient financial encounters can have a significant impact on the patient experience and whether or not a bill gets paid. Findings show:
– Billing options matter: 37 percent of patients prefer to pay online, while only 6 percent prefer payment by phone
– Keep it simple: Patients’ top requests for a more positive experience include simpler bills that show the total balance (45 percent) and payment plan options (42 percent)
– Learn from retail: While 42 percent of patients would like to be offered a payment plan, only a quarter said they have been offered one to resolve their bill
– Open the lines of communication: 67 percent of patients have not and do not plan to discuss their final bill with the hospital
6. A variety of factors affect patient satisfaction—and therefore a variety can be improved to make the patient financial experience more positive.
Simpler bills that show a total balance, more payment plan options and access to an online portal garnered the strongest positive responses, with more physical mail and automated reminders ranking as the least desirable.
Why It Matters
The key findings reflect that tailored encounters, evolving processes, collaboration, and education will be key to ensuring a more positive patient experience and driving patient loyalty.
“In an era of high-deductible health plans and increasing demands for price transparency, we’re glad to see a surge of legislation around price disclosure” said Waystar CEO Matt Hawkins. “But our study found that, even with improved price transparency, a one-size-fits-all approach to patient billing doesn’t make sense. There’s still a lot of information for patients to decipher and providers need to prioritize clear, tailored communication with patients. Only then will we truly build a better patient financial experience and revenue cycle.”