Medical debt is one of the most significant pain points for healthcare patients and providers alike. Large bills keep patients out of the hospital for issues ranging from inconvenient to potentially life-threatening, and this scenario poses a problem for patients and their care providers.
Traditionally, medical debt owed to the provider resulted in a costly collections process that introduced extra expenses and complications for both parties. Alternatively, some patients put medical bills on credit cards to keep them from becoming delinquent and harming their credit. A 2019 LendingTree survey found that 56% of credit cardholders had used theirs to settle a medical bill at some point.
Now there is an emerging solution that leverages the positives of both strategies without as many drawbacks. This is called a Buy Now, Pay Later program. BNLP options for healthcare providers solve many issues for both parties and breed more trust and cooperation with consumers.
What is a Buy Now, Pay Later Program?
A BNPL program is a financial service from the healthcare provider, often handled by a third-party partner, that breaks up bills into smaller low-or-no-interest payments over time. These plans give patients more flexibility in paying for their medical bills, even those with lower incomes or credit. It also avoids costly collections processes for providers and further patient credit damage.
PYMNTS and Rectangle Health performed a survey in 2021 that found that 63% of healthcare consumers were interested in a payment plan, but less than half had been offered one. This data signifies a major hole in the healthcare market, but providers need to see tangible benefits before implementing such a sweeping change.
What Are The Benefits of BNPL Options for Healthcare Providers?
BNPL has become popular in many retail spaces, but it is relatively new to the healthcare industry. Luckily, there are third parties with ready-to-implement financial services that providers can quickly deploy. These services offer the following benefits to patients and providers:
- Payment Flexibility
- Simple Payment Interface
- Easier Approvals With Lower Interest
- Third-Party Support for Patients and Providers
- Lower Costs for Providers
- Increased Non-Acute Care Revenue
Healthcare providers with a quality third-party partner can go above and beyond to ensure patients make their payments consistently. This partnership helps patients get the care they need and not end up with inflated medical costs from waiting until an emergency visit is necessary.
While BNPL programs offer many shorter-term payment plans, they can also stretch larger medical bills over more extended periods, allowing patients to get multi-thousand-dollar care paid for in $100 increments if they need it. These plans can be a lifesaver for patients on low or fixed incomes, which comprises much of the older community that require chronic care.
Simple Payment Interface
Experts in the BNPL and POS financing fields offer excellent software tools for online payments that make it much simpler for patients to pay their medical bills. This streamlining reduces friction in the payment process, increasing the likelihood that patients make timely payments. It is also beneficial for older patients that struggle with complicated online billing systems.
Easier Approvals With Lower Interest
Many patients are hesitant to use credit cards or personal loans for medical care because of high-interest rates and low approval odds, leading to reduced credit scores from hard inquiries. These factors can discourage timely care and lead to more acute health issues. Luckily, BNPL plans use “soft pulls” with no impact on credit and have better approval odds than personal loans and credit cards.
Additionally, BNPL in the healthcare industry often carries no interest, just like regular medical debt. This detail is essential because interest raises the cost of debt, making patients less likely to pay, and doesn’t benefit healthcare providers at all. So, eliminating interest from the equation helps both parties without harming either.
Third-Party Support for Patients and Providers
Financing is complicated and can lead to confusion and extra expenses for both consumers and providers. Utilizing an established BNPL platform solves these issues by providing expert support and education to providers. Third-party partners also handle logistical issues that providers don’t want to deal with, like:
- Financial data security
- Bug fixes for the payment interface
- Payment processing
Not only does this save time, but it can save money, too.
Lower Costs for Providers
All of the logistics that third parties handle can save providers on the costs involved with doing an in-house payment plan. By partnering with an established POS finance firm, healthcare companies can benefit from the economy of scale, which allows the finance partner to offer those services at a much lower cost than in-house alternatives. Ensuring that patients can pay their bills will also reduce the costs of hiring collections agencies.
Increased Non-Acute Care Revenue
Healthcare providers need revenue to keep everything running smoothly, and it can be even more advantageous to increase revenues from lower-cost departments comprised mostly of non-acute care. By making routine healthcare more attainable, providers give patients the ability to come in more often for preventative care, which costs the hospital much less than more severe needs.
Affordable routine healthcare results in more income from departments with low overhead and better health outcomes for patients. When consumers feel like they can comfortably afford their preventative visits, they are far more likely to avoid emergency medical issues later.
Skeps BNPL Options for Healthcare Providers
Skeps offers cutting-edge POS financing and BNPL services for lenders and healthcare providers, allowing them to enjoy every benefit listed above. With top-of-the-line support and data security, providers can rest easy knowing that their patients can afford care.