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3 Ways to improve patients’ financial literacy


With growing medical debt, the need to make the patient financial experience as predictable, clear, and manageable as possible needs to be a priority.

money literacy | © Andrey Popov - stock.adobe.com

© Andrey Popov - stock.adobe.com

Medical debt is of growing concern across the nation. Nearly 1-in-5 U.S. households has reported having some form of overdue medical debt. And it’s middle-class Americans who are struggling the most, with nearly 1 in 4 — or roughly 17 million people — having unpaid medical bills.

Adding to the concern is the number of people who are vulnerable. According to a Kaiser Family Foundation (KFF) survey, about half of adults said they are would be unable to pay a $500 unexpected medical bill without borrowing money.

Unfortunately, the complexity of our healthcare system is strikingly evident when it comes to payment. Often the issue is that the patient does not understand what they are responsible for versus their insurance plan. Common health insurance terms such “in-network,” “deductible,” “copay,” and “max-out-of-pocket,” are often misunderstood by patients, especially those who only interact with the medical system a few times per year.

Another KFF consumer survey asked insured adults how well they understood key aspects of their health insurance – what it covers, what they will owe out of pocket when they receive care in and out-of-network, how to find information about provider networks, how to understand their explanation of benefits (EOB) statements, and other common terms used in health insurance. The survey found that 51% of insured adults said that at least one aspect of their insurance was at least somewhat difficult to understand.

However, there are ways healthcare providers and payers can make the financial experience easier for consumers, such as offering patients greater levels of transparency and setting expectations as to services provided and the corresponding payment experience in advance. Following are three ways that providers can help improve patients’ financial literacy:

1) Operationalize transparency

Cost transparency is expected in most industries and providing helpful cost information to patients will improve their experience and help ease financial concerns.

Cost estimation tools can create clear projections that enable patients to know what will be owed at or before the time of service. For scheduled services, the check-in process can provide an opportunity to confirm several key pieces of data: demographic information, insurance and benefits coverage, copay and service amount estimate based on visit type. In addition, to help patients understand costs for both scheduled and emergency visits, providers can use this opportunity to educate patients on their coverage, using online resources, in-office signage, and one-on-one conversations at the time of service. Increasing cost transparency and providing accurate upfront estimates improves patient trust and loyalty. For example, 83% of customers value transparency above brand reputation, according to a McKinsey survey, while 39% of consumers have shifted to a rival due to hidden expenses, a Deloitte poll found.

2) Offer flexibility in payment methods and plans

With digital tools available, providers can offer multiple options to patients to facilitate payment, such as debit and credit cards, digital wallets, and payment plans. Giving patients the option to store credit card information securely with a “card-on-file” option avoids the need to enter their credit card number, expiration date, and security code for future transactions. Digital wallets are easily accessed on computers or smartphones, eliminating the need for consumers to carry a traditional wallet or credit or debit cards.

Digital tools also make it easy and convenient to enable patients to set up their own payment plans. These plans can take into account the total amount due, patient preferences for monthly payment amount and date, and the length of the term.

3) Make convenience integral to the experience

When it comes to offering convenient payment options, conventional wisdom indicates that young people are more likely to use digital technology than seniors. However, in reality, a PYMTS survey recently found that 8% of Baby Boomers and seniors had made a payment through a provider’s website, which matched the percentage of Generation Z. Similarly, more than 20% of Baby Boomers and seniors reported making a payment through a patient portal. It’s more important than ever to offer a financial experience that provides the same level of convenience consumers have come to expect in other industries, which can improve payment collection rates – both at the time of service and afterwards – and enhance patient loyalty.


With growing medical debt, the need to make the patient financial experience as predictable, clear, and manageable as possible needs to be a priority. From understanding out-of-pocket costs up front to having convenient payment options and flexible payment plans, patients are looking to their providers to create healthcare experiences on par with experiences in other industries. Digital financial tools that help patients avoid medical debt will pay dividends to patients and providers alike.

Johnathan Welch is Chief Product Officer at TrustCommerce, a Sphere company

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