Are Patients Willing to Pay Out-Of-Pocket Healthcare Costs?


Let’s face it: For many medical practices, collections of the self-pay portion of healthcare bills aren’t where they need to be. Patients often aren’t paying for their care, and that hurts medical practices’ bottom lines.

But as care facilities and ambulatory centers spend valuable time and resources pursuing payment on claims, filing paperwork and working with third-party collection agencies, it’s fair to wonder if it’s even worth it. Even if you do things the “right way” are patients willing to pay their bills?


First, a little bit of context.

The implementation of the Affordable Care Act accelerated a trend in healthcare coverage that was already happening: company healthcare plans that require employees to meet high deductibles before insurance covers the cost of care.

These high deductible healthcare plans, or HDHPs, stray from the traditional model of healthcare coverage, in which insurance companies are the primary payers. For a long time, the majority of providers collected payments primarily from insurance providers. Because of this, at one point, most providers were able to write off the patient portion of payments as lost revenue. It was a pennies on the dollar of all revenue collection.

But rising deductibles and out-of-pocket costs make a higher portion of the bill the responsibility of the patient. In 2016 it’s one thing to ignore pennies, but if you’re leaving nearly a quarter of every dollar on the table, you’re setting yourself up for failure.

With today’s challenge being collecting on patient payments, providers have to refocus their collection efforts. Because collecting the patient responsibility has historically challenged providers, there’s a perception that patients don’t want to pay their medical bills.

But is that true?

Compelling research shows that patients are in fact willing to pay for medical care. According to a McKinsey & Company study, 74 percent of consumers are willing to pay out-of-pocket expenses of up to $1,000 per year, while 90 percent are willing to pay if that number drops to $500 per year.


There’s an important note to make here: In order to collect patient payments, the process must be clear and simple for patients. TransUnion market research revealed that 75 percent of patients believe a cost estimate prior to treatment makes it easier for them to pay for healthcare. Getting information about the payment up front helps healthcare consumers plan to make a payment and avoid sticker shock once a bill arrives.

Nobody wants to wade through paperwork they don’t understand, or be surprised at the high cost of something they purchase. Simplify the patient payment experience, and the question changes from “Are patients willing to pay out-of-pocket healthcare costs” to “Why did we wait until now to collect patient payments this effectively?”