Physicians and health systems lost billions in revenue during the initial months of the COVID-19 pandemic, and recouping those losses is proving challenging given existing barriers to positive consumer experiences.
A new survey from PYMNTS and Rectangle Health details the extent to which this is true, finding that most consumers are interested in having access to payment plans and a majority want to manage their payments digitally. About a third say that establishing payment plans would entice them to switch medical providers.
The survey, which polled people based on census demographics, is based on input from more than 2,000 consumers’ healthcare payment experiences and the challenges they faced.
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WHAT’S THE IMPACT?
Almost half of all patients said they would choose to stay at home and disengage with their healthcare providers, even if doing so was not legally required or medically advisable. In 2020, that translated to millions of people putting off checkups, screenings and elective surgeries.
Many of those same patients feel that customer experience is an important part of their healthcare journey, and a key reason to stay with a provider, or to abandon them. Ninety-four percent expressed satisfaction with in-person visits, but they were vocal about the features they missed.
The message to healthcare providers is simple: Interventions, particularly digital interventions, are needed to retain patients, engage them and prevent a further loss of revenue.
That’s reflected in the numbers, which showed nearly two-thirds of patients want access to payment plans, and just 44% of respondents said they were offered payment plans in 2020. Providers miss a revenue opportunity when they infrequently pass such plans onto consumers, which effectively leaves money on the table at a time when providers can ill afford it.
The digital “bedside manner” is an important factor as well, with 22% “very” or “extremely” loyal patients saying they’d drop a preferred physician or practice because tools such as digital form completion, payment reminders and appointment reminders aren’t offered. This speaks to the ongoing consumerization of the healthcare industry.
Preserving the impressive 94% satisfaction rate with in-person interactions will require effective digital communications, such as check-ins that require only a few clicks, and will eliminate many repetitive administrative tasks.
Healthcare organizations have struggled during the pandemic to launch user-friendly booking and payment solutions that sync online and offline tasks and enable frictionless experiences for consumers in the office or on their devices. Only 23% of patients with balances due after a visit paid online, even though 37% and 34% cited credit and debit cards, respectively, as their preferred payment methods.
That sets up one of the biggest opportunities for medical practices to recoup losses. According to the survey, 54% of patients are interested in monitoring their upcoming provider payments digitally, 43% are willing to store their preferred payment details with their providers, and another 43% would automate payments to avoid repetitive manual data entry in the office and online.
Along with online payments, notifications and automated charges give in-house human resources the bandwidth to issue and track outstanding bills, allowing staff to focus on delivering in-office customer service. Consumers experience less confusion at checkout when they can view outstanding bill statuses instantly and digitally manage their payments.
THE LARGER TREND
The findings come at a time when high COVID-19 hospitalization rates and consumer reluctance to visit healthcare facilities for nonurgent care continue to drive poor performance for the nation’s hospitals, health systems and physician groups.
According to Kaufman Hall’s January Flash Report, the median hospital operating margin index closed a tumultuous 2020 at 0.3%, not including federal Coronavirus Aid, Relief, and Economic Security Act funding. With the funding, it was 2.7%. The median 2020 operating Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) margin was 5.1% without CARES and 7.6% with CARES.
The numbers speak to the struggles the healthcare industry faces as it remains in the thick of the battle against the coronavirus. Physician practices saw some gains from July to October 2020, but remained below 2019 levels on most performance measures.