There is a real epidemic occurring in the health care industry, a dangerous one.

It’s one that threatens to undermine the revenue of everyone, from hospitals to private practices, and all signs point to one thing.

The problem is increasing unpaid health care bills. In 2012, hospitals faced almost $42 billion in uncompensated care. Even more frightening, a report by McKinsey & Company estimates that the rate of bad debt to health care providers is growing by roughly 30 percent a year.

With fewer uninsured Americans now than in the past, it may initially be difficult to understand where all the debt is coming from. The answer lies in payment responsibility and increasing out-of-pocket costs.

While the uninsured rate has dropped from 15.7 percent in 2009 to 9.1 percent in 2015, the number of consumer payments owed to health care providers has increased 193 percent. The burden of payment has been moved from companies and the government to patients.

Primarily this shift has been led by an increase in the number of insured who opt for high deductible health plans (HDHP), especially millennials. In 2015, 24 percent of employees opted for these high deductible plans through their employers, with more choosing HDHP as part of the Affordable Care Act.

Consumers now face paying more for their health care out of pocket than ever before. That’s certainly a problem in and of itself, but what compounds the issue is the lack of payment options for patients. Many health care providers remain shackled to paper-driven and inefficient billing systems.

Even for those that have electronic systems in place, ease of payment isn’t always part of their solution. In some cases, difficult and confusing user interfaces cause problems. In others, the ability to pay online doesn’t even exist. Today’s consumers are increasingly tech-savvy. But even an increased understanding of how to use apps and the web can’t replace the value of intuitive, or frictionless, user experiences.

For some health care providers that offer electronic payments, their applications exist in the same technology ecosystem as those that contain personal health care information (PHI). As a result, providers must require users to validate themselves through the system, answering a multitude of questions when all they really want to do is simply pay a bill.

Disparate, or siloed, systems can cause similar problems. If a patient receives multiple bills with different account numbers for the same visit and must make each payment separately, the convenience of being able to pay online or through an app disappears.

Whether in health care or in retail, the user experience is critical to a satisfied customer. Once someone becomes frustrated with an online payment process they may quit, intending to use another means of payment later. But with busy lives, they simply forget until the next bill arrives.

A confusing user interface can also result in payees submitting the incorrect amount, placing the burden on the administration team at the health care provider to correct. In either case, this means increased costs to you and increased time before the revenue can be realized.

Autonomous payment options
Some health care providers don’t offer online payment options, or they offer a limited number of options. This could be their own choice, a lack of resource availability or because their office software doesn’t offer payment options. Practitioners should look closely at the features of their software because consumers expect to have payment choices that fit their needs.

With the increase in HDHPs, choice in payment becomes critical for a number of reasons. The significant increase in patient responsibility means that more patients will seek out the ability to pay with a credit card or to pay over time.

Health care provider software needs to be able to accept different forms of payment to prevent blocking a patient from submitting payment when they are looking to do so. Taking electronic payments from a credit card gives patients the freedom to pay bills quickly while potentially even using cards that give them loyalty points and miles.

For larger payments, or for those patients struggling to pay a bill, regular payments over time can mean the difference between a provider seeing revenue or having to write off a debt. But remember, convenience is key for both the patient and the provider. Having to send out multiple bills or follow-up monthly with patients only serve to increase administrative costs and headaches.

Instead, allowing payments to be automatically deducted from a bank account by offering an eCheck option allows patients to set and forget their payments. This also gives the provider a cost-effective means of collecting outstanding balances.

The burden of health care costs on the consumer is only likely to increase over time as patients continue to opt for HDHPs. It’s critical that health care providers adapt their administration and payment systems to make payments easier for patients, or risk facing an increasing burden of outstanding patient debt.

About the author: Preston Glenn has been with Forte Payment Systems for 9 years and manages the Inside Sales team and the Account Executive team.