Adapting the dialogue in healthcare: Communicating with patients about financial responsibilities

Long before the COVID-19 pandemic began causing disruption and rapid change in the healthcare industry, trends like rising out-of-pocket costs and healthcare consumerism highlighted the growing importance of the patient financial experience. Many patients today are directly responsible for a significant portion of their healthcare costs, and they may want or need more information and support to help them manage these costs effectively. At the same time, they may expect some of the flexibility, convenience and personalization that are often available when making other kinds of purchases.

This combination of greater responsibility and higher expectations have made it essential for hospitals and health systems to prioritize the patient financial experience, but doing so can involve many challenges. For example, despite the importance of cost and payments, patients and providers alike may feel uncomfortable talking about financial matters. In terms of technology, consumer solutions may be readily available but difficult to integrate with legacy systems and processes.

To better understand how — and how well — leading hospitals and health systems are addressing challenges like these, CareCredit sponsored a survey with Becker’s Hospital Review to capture insights from 100 healthcare executives in December 2020. The results of this survey, building on a series of research studies CareCredit conducted in 2019 and 2020, point to some important insights and useful strategies healthcare leaders can leverage to deliver a positive patient financial experience.

1. Embrace the consumer mindset

Based on the most recent CMS projections, overall spending on healthcare in the U.S. is projected to increase 5.4 percent annually through 2028, reaching $6.2 trillion, outstripping GDP, and accounting for nearly a fifth of the national economy (19.7 percent).1 At the same time, patients and families are accounting for a large and growing portion of this spending directly. According to a Kaiser Family Foundation study released late last year, deductibles have risen 79 percent in the past decade, and premiums have increased 48 percent.2

As they face higher out-of-pocket costs, it’s no surprise that many patients are paying more attention to financial aspects of healthcare. A CareCredit study3 completed before the pandemic found financial considerations often impact patients’ healthcare decisions: 43 percent of those surveyed said they had changed their behavior due to costs, in most cases by decreasing or delaying care.4 In addition, nearly 65 percent of those surveyed said they would consider switching providers after receiving an unexpectedly high bill, and nearly 59 percent said they would consider switching if staff were unable to provide cost information.5 Even when cost concerns don’t directly affect patient decision-making, they can take a significant toll. In 2019, The Physicians Foundation found 73 percent of surveyed Americans expressed concern about being able to afford medical treatment if they got sick.6

What does all of this mean for providers? Fundamentally, it’s important to acknowledge the significance of financial considerations and embrace healthcare consumerism. This may seem obvious, but changing long-established approaches can be challenging, and achieving a true shift in mindset and consistent behavior throughout an organization takes time and effort. For example, Becker’s found that 77 percent of surveyed healthcare leaders said designated staff in their organizations are well-prepared to have financial conversations with patients, and 69 percent said resources are available to assist with those conversations.7 However, just 52 percent reported that cost of care conversations are integrated into the clinical workflow, and only 22 percent said all staff involved in patient and family interactions receive training on financial aspects of care like costs, billing and payments.8

2. Enable transparency and clarity

According to one recent study, nearly all consumers surveyed (91 percent) said hospitals should be required to publicly disclose the costs of their services.9 However, relatively few patients may actually research healthcare costs, and those who do may not succeed. CareCredit found just 15 percent of surveyed consumers said they researched cost information before seeking care or making an appointment, and among those who did about one in four had difficulty finding the information they needed.10

Given that patients want to be informed about financial aspects of their care and often struggle to achieve this goal, it seems reasonable that they would welcome assistance from their healthcare providers. CareCredit’s survey findings reinforce this, as 48 percent of surveyed consumers said healthcare staff should be responsible for providing cost information.11 Unfortunately, doing so can present challenges; Becker’s found 56 percent of surveyed healthcare leaders cited insufficient information from payers (insurance companies) as a barrier to patient financial conversations, and 39 percent cited inadequate access to pricing and benefit information in general.12

Fortunately, there is good news as well. More than two-thirds (72 percent) of leaders surveyed by Becker’s said their organizations planned to expand pricing transparency efforts, and 79 percent said specially trained staff were available to answer patient and family pricing questions.13 Perhaps some of this emphasis and activity have been driven by new CMS requirements for “consumer-friendly” displays of “shoppable services” beginning in January 2021, but it also makes sense in terms of meeting patient expectations and equipping staff
for success.14

3. Empower patients — and staff — at every stage

Price transparency may be essential, but it is only part of the formula for success. In addition to ensuring that patients understand their financial obligations, organizations should consider ways to help them fulfill those obligations in a way that works for their families and their budgets. Healthcare consumerism involves patients not only being informed, but also empowered.

This can be as simple as accepting multiple forms of payment via a range of channels and platforms. Organizations can leverage technology to enable digital and mobile payments, as well as related benefits like self-service account management and on-demand support for billing inquiries and other needs. Consumers may be accustomed to these kinds of features and tools when managing spending in other areas, but in many ways healthcare still lags behind.

While a choice of payment method can be appealing, options related to the timing and amounts of payments may be even more important for many patients. It is heartening that 76 percent of healthcare organizations offer in-house payment plans or financing, according to the Becker’s survey, and over a third (34 percent) offer financing through a third-party partner like CareCredit.15 Unfortunately, the survey also found that just 40 percent said their front office staff felt comfortable discussing financing with patients.16 This points to a pair of related opportunities. First, more training and reinforcement for staff could have a notable impact, as 28 percent of surveyed healthcare leaders said their organizations offer no training or resources to help front office staff discuss costs and payments, and 40 percent cited a lack of staff understanding as a key barrier to having effective patient financial conversations.17

In addition, when staff do feel comfortable discussing financial matters, it may be only within a fairly narrow context at select points in the customer journey. Becker’s found that while 77 percent of survey participants said financial conversations in their organizations happened prior to treatment, fewer than half said conversations also occurred at the point of care, after treatment, or when balances were unpaid by the due date.18 Separately, CareCredit found that at every stage of the healthcare journey, more patients reported wanting cost-related information from their providers than had actually received it.19

Opportunity for lasting impact

Taken as a whole, findings from recent studies paint a picture that many healthcare industry veterans may be seeing in their own organizations and markets. Healthcare consumerism is here to stay, and while adapting the dialogue to meet changing patient expectations can be a slow and challenging process in some ways, the benefits of doing so can be significant. In addition, we are collectively making real progress toward informing and empowering patients — and equipping staff to engage in effective financial conversations. The key to future success may be building on this foundation to better integrate the patient financial experience at every touchpoint, throughout the organization and at every stage of the healthcare journey.  

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