The frustrating fact is that healthcare often comes with high out of pocket costs even for the insured, and millions are simply unable to cover those costs. It often leads to people foregoing care now that could head off more serious — and costly — health problems down the road.
Recent PYMNTS research bears this out, along with some surprising revelations as to who is having a hard time paying for the cost of healthcare, and what providers are (or should be) doing to help.
Commenting on the study “Managing Healthcare Costs: How Patients Use Payment Plans,” a PYMNTS and Experian Health collaboration, Experian Health President Tom Cox told PYMNTS’ Karen Webster that the situation is serious, and providers needs to get more proactive.
Acknowledging the fact that healthcare can often place staggering cost burdens on patients, Cox pitched it over to providers, saying many aren’t doing everything they can to discuss options and help patients find ways to afford the care they need.
In the first place, Cox said providers are “in the early innings” of even recognizing a responsibility to provide pre-care cost estimates. In other words, they historically haven’t done so and changing that is going to be a process. But the data also shows that 40% of patients who do receive cost estimates also feel they can’t afford the care, and so many go without.
“That clearly is a significant unintended consequence of providing price transparency,” Cox said, “the unintended consequence being, I now know as much as this is going to cost, oh my, I can’t afford this, therefore I postpone it, or I just don’t get the care that I need. That’s why I think you have to have that comprehensive conversation.”
It’s a knowledge gap on both sides, as healthcare providers aren’t accustomed to giving price quotes, and most consumers don’t even think to ask for them.
He said if doctors and patients have the price talk first, “they can then have a discussion about how they will pay. But if there isn’t that conversation up front — it happens less than less than 50% of the time — then those expectations can’t be managed.”
See also: Inaccurate Cost Estimates Could Push 60% of Patients to Switch Providers
Getting Doctors on Board
On the high number of younger consumers with good incomes who feel they can’t afford care even when given an estimate, Cox said, “It is really the Generation X and bridge millennials who are really struggling with that. That was a bit surprising. But overall, you just see the continued financial stress that healthcare puts on patients.”
Payment plans are the most prevalent option offered today, but “Managing Healthcare Costs: How Patients Use Payment Plans” found that 52% of all patients who paid for their most recent visits with a payment plan received an unexpected bill, and it rises to 64% among millennials.
To that, Cox said, “The good news is that the technology and the capabilities exist today. The real question is are they going to get implemented? We can check where folks are in their deductible. We can estimate with pretty good accuracy what that care is going to cost. The question is how broadly is that going to get adopted in the provider community?”
Between the No Surprises Act and new legislation on healthcare price transparency coming next year, he added that “if you don’t have that conversation about payment options, we could just exacerbate that unintended consequence of more care postponed, which is why making sure that you exhaust every payment option is important for the patient.”
Services including Experian Health will search through insurance coverage options, Medicare, Medicaid and even charities that help eligible consumers pay big healthcare bills.
Cox said the important sea change now is “making sure that the provider does that on behalf of the patient. The patient certainly doesn’t have the ability always to do that. They may not know and then they’ll just drop a large financial burden on the patient that could have been avoided.”
The realization that health systems bear a responsibility in this is news to most. “Their appointment calendars are generally full; a lot aren’t taking new patients,” Cox said. “You don’t always have the economic drivers in healthcare that you do in other economies that force the implementation and adoption of these types of services.”
See also: Regulation Forces Healthcare Pivot to Patient Estimates
‘Teachable Moments’
While the pandemic took an odd idea — doctors discussing price with patients beforehand — and brought it forward, it’s far from common practice. As practices deal more with younger demos willing to switch doctors over price, that may spur action faster.
“One of the few positive things that came out of the pandemic, I think, was the acceleration of digital tools,” Cox said, “but you can see it’s still not [being] widely adopted. I know generally when I get care, I’m not getting sent an estimate ahead of time. We’re not discussing payment options. It all exists, but generally it’s still not adopted.”
Again, this is where millennials and digital-native Gen Z consumers are likely to make an impact as they have from instant messaging to instant P2P payments. Their behaviors will force a change.
“The younger generations are going to demand a more digital experience and they will switch if they do not get it,” he said. “They will not have the same loyalty that probably the baby boomer generation does. They will switch based on convenience and ease of use.”
He also spoke of “teachable moments” for doctors that mean having the right data available to help consumers make informed decisions and explore healthcare financing options.
Conceding that it’s complicated delivering cost information on deductibles, insurance and actual total care costs, he said, “It can be done, and it really must be done at the time the patient is engaging in cares. If you let them go, you’ll have a hard time getting them back.”
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