How to Develop a Strong Financial Partnership with Patients (and why it matters)
The financial relationship between healthcare providers and patients has endured a dramatic transformation over the last decade. The drive to hold providers and payers more accountable for delivering quality care at a lower cost has pushed greater payment responsibility toward patients. According to a KFF Employer Health Benefits Survey, deductibles rose an astounding 111% and family premiums increased by 55% from 2010 to 2020.
With more skin in the game, patients-turned-payers have also become patients-turned-consumers. As patients increasingly “shop” for their healthcare services, providers are focusing on enhancing patient experience to stay competitive. At the same time, providers have had to develop a new skill: asking patients for more money.
Managing this new dynamic is a challenge. Many healthcare organizations wrestle with finding ways to positively engage patients in financial conversations to collect timely and complete payments. Organizations must balance providing patient-centered care and collecting growing payment obligations without alienating consumers. The best solution to this challenge is to develop a strong financial partnership with patients — one that fosters a mutually beneficial relationship.
Positive Financial Engagement: A Win-Win Proposition
I’ve written before how trust is the true currency of healthcare. A strong financial partnership with patients is a cornerstone of building trust. Cultivating positive financial engagement is a win-win for patients and providers.
A 2017 study found that a positive patient experience improves hospital profitability. And financial engagement is a significant part of the overall experience. In a Deloitte survey of American healthcare consumers, 66% of respondents said that an easy-to-understand bill was an important factor in their healthcare experience.
Price transparency and financial engagement are essential to improving the patient revenue cycle. Patients are more likely to pay their medical bills in response to effective financial engagement. Additionally, being honest and upfront about finances can pay dividends when it comes to patient trust, satisfaction, and loyalty. Studies show that patients who receive an unexpectedly high bill are more likely to switch providers. With patient trust and loyalty come greater likelihood of endorsement, which can translate to higher new patient volume.
With over two-thirds of bankruptcies attributed to medical costs, patient financial stress is a real phenomenon in healthcare. Fears about the cost of healthcare services can negatively impact health outcomes as worried patients delay medical care or fail to comply with costly treatments. Financial engagement that relieves patients’ payment stress have the potential to reverse these negative impacts.
5 Keys to Developing a Strong Financial Partnership
Transforming your organization’s financial relationship with patients into a win-win proposition requires delivering a consumer-friendly experience. By embracing these five high-impact strategies, you can make that happen.
- Make meeting patients where they are your organization’s guiding principle. Taking the time to understand your patients’ financial pain points and expectations and creating a financial experience that specifically eases those pain points and meets their expectations will lay the foundation for a strong financial partnership.
- Start the financial conversation early and continue it throughout the patient journey. Consumers want to know their financial obligation from the outset, so informing them of their out-of-pocket obligation prior to care is crucial to an optimal patient experience. Because of the complexity of healthcare payments — involvement of multiple payers and evolving clinical needs — healthcare organizations should engage patients as financial partners every step of the way, from front-end registration to back-end bill collection.
- Deliver an easy-to-navigate and consistent financial experience. Patients want the same integrated, seamless, and consistent financial experience they’ve become accustomed to in other industries, such as retail and banking. Simplifying and unifying medical billing processes throughout your health system will create a less frustrating and more effective financial partnership.
- Convey compassion and empathy in every financial encounter. Patients want to feel like someone is on their side. Organizations should have trained financial counselors or navigators to educate patients on the payment process, inform them of payment flexibility, and advocate for them by finding different funding sources. Offering secure financial tools, such as price estimates and convenient payment options, through a portal or mobile payment app shows that you value their time and respect their comfort level when it comes to financial matters.
- Invest in improving patient financial experience. The investment in staffing, training, process improvement, tools, and technology to better engage patients and enhance the financial experience is well justified when you consider the clinical and financial outcomes.
Making It Happen
Implementing the right strategies and tools for financial engagement will enable your organization to build a strong, sustainable financial partnership with patients by empowering them to choose the highest value healthcare while ensuring you get paid for providing it. It’s truly a win-win proposition.