As you are no doubt aware, the healthcare industry is changing rapidly.

10 years ago,  the majority of healthcare payments in hospitals came from insurance payers, but today the percentage of patient payments has increased from 5% to around 35%. This number will only continue to grow.

In the current landscape, there are at least three generations of Americans currently utilizing the healthcare system, and each generation encompasses varying mindsets and preferences as to how they wish to engage with their healthcare systems and approach to billing.

Baby Boomers, born between 1943-1960, recently became eligible for Medicare, and most are in retirement. This generation encompasses the rapid population growth that occurred immediately following World War II. We’ll call our Baby Boomer patient example “Larry.” Larry isn’t that fond of technology, prefers postal mail, and as he is aging, he finds he is making more frequent trips to the doctor, including a recent angioplasty.

Generation X, born between 1961-1981, are considered an in between generation, raised just before the internet and technology really boomed. Our Generation X-er is named “Tammy”, and she’s a married, mother of three. She works full time and handles the medical bills and appointments for her family members who are each covered by her employer’s commercial insurance. She pays some bills online but prefers to mail in checks when she can. 

Millennials, born between 1982-2004, grew up with the internet and smartphones. Our patient example, “Brittany” is always checking Facebook and would much rather text than make a phone call. She uses apps for everything, and rarely even checks her mailbox.

As a provider, have you thought about these varying generations and the differences in their billing and payment preferences?

It is becoming clearer that we are reaching a tipping point in patient pay early out and in order to collect cash, you need to meet the patient engagement expectations for each generation visiting health systems and clinics with diverse needs.  

Below are some common questions that your multi-generational patients are asking and what you can do about it.

Technology Adoption

Larry: “Did you receive my payment? It hasn’t come out of my checking account yet.”
Tammy: “Can I pay online?”
Brittany:  “Will you please send me a text reminder?”

Retail services and online platforms like Amazon are at the forefront of consumer technology - whether it’s through the use of apps, portals, analytics, or payment IVRs - the healthcare industry is struggling to catch up now that there is such a high reliance on out-of-pocket payments.

The younger generation of Millennials are more apt to adopt mobile text apps for appointment reminders and bill pay, and the Baby Boomers may, in general, want to mail in a check, but deploying appropriate technology within your payment program gives all patients options. An increase in options also increases happiness, engagement, and convenience for not only your patients but your patient experience representatives.

Engage Your Patients From the Start

Larry: “I don’t understand why I owe a balance, I have Medicare and AARP.”
Tammy: “What do I owe this balance for? I paid my copay at the clinic.”
Brittany: “I didn’t get a bill, why are you calling me?”

From the first point of patient contact, engaging the patient on their terms and asking about their preferred communication style, to advising what to expect regarding billing options, makes the entire clinical and revenue cycle process easier from beginning to end.

Patient communication preferences are duly important when considering regulatory acts like the Telephone Consumer Protection Act (TCPA), which limits the use of automatic dialing systems, prerecorded voice messages, SMS text messages, and faxes. Your organization must ask patients how and when they wish to be contacted in order to avoid costly violations.

Patient statements by postal mail are often the first billing communication that patients receive and the importance of a well-designed and direct statement cannot be exaggerated.  Statements must be well designed with human psychology and a little bit of artistic flair in mind to draw the patient’s eye to pertinent information and create a well-received understandable bill.

For example, bills have a very high open and read rate (95%), according to APEX systems, however, if we fail to control how information is consumed, it can lead to confusion—resulting in a poor patient experience and disappointing payment results. 

A Clear and Well Written Payment Policy

Larry: “That’s not what the doctor told me, why are you telling me something different?”
Tammy: “That payment plan is way too high for me; why can’t I pay XX dollars a month instead?”
Brittany: “I didn’t know I’d owe so much just after a visit to the doctor. I can’t afford it.”

Transparency in billing matters is equally important as transparency in clinical matters to your patients. Setting the expectations for payment before the care encounter is another shift that many organizations are moving towards. Patients sometimes delay making payments because they have questions about what they owe or assume that their insurance payer is taking care of a balance when it truly is the patient responsibility.

Communicating your payment policy to Larry may be different than how you communicate to  Tammy. Knowing what your patient preferences are and communicating them clearly is the key to customizing payment options for various demographics of your patient population.  For instance, Larry may prefer a prompt pay discount option, and Tammy might want a long-term payment plan.

Drive Consumer Communication Preference Through Analytics

Larry: “You didn’t need to call me, I’ll just pay the whole balance and take care of it now.”
Tammy:  “Can I make an automatically recurring payment each month?”
Brittany: “Why do I only get 60 days to pay this bill?”

Many industries understand their customers' preferences, and while healthcare reaches every single demographic, your particular geographic footprint, specialty areas, and financial status levels of patients are unique to your organization. In order to stay profitable, it’s a good plan to research your patient segments and use technological resources to understand your data, and then implement changes to improve your revenue cycle processes and collection strategies.

Once you have an informed understanding of your patient preferences and set desired outcomes and goals for your organization guiding your patients to adopt technology becomes easier.

For instance, you may want your patients to:

• Make payments online
• Enroll in payment plans
• Pay on the first statement cycle
• Enroll in electronic statements

Take the above steps into consideration and implement new technologies to engage your patients.

The Bottom Line

Patients will continue to owe a larger percentage of their out-of-pocket medical expenses, and business as usual — treating all of your patients the same — is not going to cut it. Brittany just does not consume information the same way that Larry does and failing to understand this, simply leaves money on the table. Consumers demand more from shopping and travel apps and their patience with healthcare will wane too.

Understanding your patients preferences for technology and payment options is an important factor in reaching your revenue goals

We can testify to the results — when MediRevv implemented a payment IVR for one of our partners, giving patients the option to pay over the phone, our call abandonment rate decreased by 3%, and 22% of all patient payments were made through the IVR within the first six months from go-live.

The power to control this starts with you, so let’s accelerate your cash flow while maintaining your patient focus. Learn more about patient pay early out in our definitive guide.