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Opportunities Are Endless for Billing Services
By Chris Seib
HBMA RCM Advisor: The Journal of the Healthcare Business Management Association

Trends in Healthcare Payments

Opportunities Are Endless for Billing Services

RCM companies can leverage the industry trends to collect more and prove the value of your organization’s partnership.

When it comes to patient collections, trends in healthcare payments tell us that providers are struggling. Though patients owe more for services, providers still rely on the same collection methods from decades ago: print and mail statements. The appetite among patients for these outdated tools is becoming less and less, and it shows in how effectively providers are collecting payments form their patients. Billing services have the opportunity to leverage the industry trends to empower providers to collect more and prove the value of your organization’s partnership.

One surprising trend coming out of 2018 is just how many providers are still concerned about patient collections, despite payment responsibility steadily increasing for the better part of a decade:

  • In 2018, 85% of covered workers have a deductible, up from 59% in 2008 (Kaiser Family Foundation).
  • The average deductible was $1,573 in 2018, up from $735 in 2008 (Kaiser Family Foundation).

Perhaps providers thought, like so many did, that deductibles would reduce how often a patient used their services and their payment collections would not increase. That turned out to be false: Between 2013 and 2017, healthcare utilization declined only 0.2%, while medical costs increased 17% (Healthcare Cost Institute).

Whatever the reason for why providers are still concerned about patient collections, the truth remains that providers are using outdated practices to connect with patients for their bills. Providers still heavily rely on paper and manual process for collections with the primary method being paper statements, despite the fact we now live in a digital world:

  • 14.2 billion connected things will be in use in 2019 and will reach 25 billion by 2021 (Gartner).
  • 81% of consumers own a smartphone (Pew Research Center).
  • Consumers look at their phones an average of 52 times a day (Deloitte).

The gap between providers’ outdated collection methods and the digital reality of the consumer experience is causing significant delays in receiving any payment from their patients. The longer providers wait to receive payments, the harder it is for them to stay in business. This is especially true when patients owe larger balances, which actually take longer to collect for providers: 81% of providers cannot collect $1,000+ in 30 days (Provider Healthcare Payments Survey 2018).

Billing services may be quick to conclude that patients are simply avoiding their medical bills. While that may be true for some patients, the fact is that for most patients, medical bills usually come as a shock:

  • 61% of consumers received a bill for more than expected (Consumer Healthcare Payments Survey 2018).
  • 50% of consumers received an unexpected bill (Consumer Healthcare Payments Survey 2018).
  • 24% of consumers were sent to collections (Consumer Healthcare Payments Survey 2018).

All these trends converge to reveal a huge gap between providers and patients when it comes to payment collections. This is where billing services are desperately needed to deliver a better payment experience for both providers and patients.
How can billing services bridge the gap between providers and their patients? We can again look to the trends for the answers:

Eliminate paper statements … completely.
Only 17% of consumers receive their medical bills electronically, while 71% of consumers want to enroll in e-statements from providers (Consumer Healthcare Payments Survey 2018).

There is strong resistance in healthcare to eliminate paper statements, but this flies in the face of what patients want from their payment experience. Patients are used to electronic forms of communications for most of their bills; why should provider statements be any different? Plus, electronic statements are sent via email and text messages, which can significantly speed up the collection process.

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Make healthcare payments mobile.
Payments from a mobile device on the InstaMed Network have increased to 29% of all online payments in 2018, up 65% since 2015 (InstaMed Network Data).

When patients receive their bill notification via email or text message, they will make their payments on their mobile device as soon as they receive it. As smartphones dominate the consumer experience, billing services must consider mobile as part of their collection strategy.

Be where patients already are.
Eighty-six percent of consumers want to make all of their healthcare payments in one place (Consumer Healthcare Payments Survey 2018).

The ability to make a payment online is now a standard business practice in most industries and is quickly becoming a growing share of overall payment experiences. Billing services that offer online payment portals meet demand for a convenient experience in the digital age.

Automatic payments are guaranteed payments.
From 2015-2018, the total number of automatic payments increased 362%, or 115% year over year (InstaMed Network Data).

Automatic payments allow patients to “set it and forget it” when it comes to medical bills. This is critical for payments that patients can pay but are inconvenient such as weekly counseling or physical therapy appointments.

The number of payment plans increased by 467% from 2015-2018, growing by 78% on average each year (InstaMed Network Data).

Automatic payments in the form of payment plans offer patients the ability to manage larger bills over time, especially for those with high deductibles. Payment plans offer patients convenient options for those large bills while guaranteeing that the payment is received without any manual intervention or paper needed.

To dig deeper into these trends and what they mean for healthcare, the full Trends in Healthcare Payments Ninth Annual Report: 2018 is available online at

Chris Seib is the chief technology officer and co-founder of InstaMed. Chris co-founded InstaMed in 2004 where he has led the vision and successful execution of building one platform for all forms of payment in healthcare. At InstaMed, Seib is responsible for all aspects of the product strategy, product delivery, and technology. He combines expertise in financial technology, healthcare information technology, and customer-centric design to drive the growth of the InstaMed Network, which connects providers, payers, and consumers and processes tens of billions of dollars in healthcare payments annually. Seib is a named inventor of multiple patents held by InstaMed.



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