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Care Now, Pay Later: For the betterment of the patient and provider relationship

Healthcare Payments

03. 05. 21

Mike Peluso
by Mike Peluso · CTO, Rectangle Health · February 26, 2021


Retailers everywhere are jumping on a modernized, modified take on “layaway” called Buy Now, Pay Later (BNPL) that lets consumers purchase an item for a fraction of the total price and make the additional payments over time. While hugely popular, the downside of BNPL is that it puts people at risk of over-buying and facing fees for delinquent payments.

What works in retail doesn’t necessarily translate to healthcare, and we shouldn’t try to make it. In healthcare, the problem facing providers is that they need patients to come to them for care, but many of their patients cannot, or prefer not to, pay for their care with a lumpsum payment. Since the root of the issue is the high cost of healthcare, it leaves the providers to figure out how to get paid for treatment through external financing or collection companies. That’s where Care Now, Pay Later (CNPL) comes in as the solution for both patients and providers.

Care Now, Pay Later offers a way to get more patients coming in for care and electing treatment paths, because they know that they will be given payment options that work for them. In a recent consumer study by Rectangle Health and PYMNTS, six out of every ten patients expressed interest in payment plan options, but only 44% of patients reported being offered them by providers. Adding payment plans to your practice’s payment options is a huge opportunity for practices to generate new streams of income, to increase patient satisfaction, and to get more patients through the door.

Patients with the lowest levels of financial security are least likely to be offered access to installment payments, yet they are the most likely to experience financial distress and end their relationships with providers due to cost concerns1. Offering flexible patient financing options, Care Now, Pay Later is a movement toward the betterment of the patient and provider relationship.

Care Now, Pay Later payment plans break payments up into installments that are manageable for patients and that create steady income for providers, benefitting both the patient and the provider. However, some providers are hesitant to roll out payment plans out of fear that patients will default on their payments.

While numbers show that the risk of default is very low compared to the increase in payments that providers will see overall, the beauty of CNPL is that it’s flexible. If providers are uncomfortable splitting a payment evenly across a number of installments, they can choose, rather, to charge a certain percentage, say 50%, upfront and break the remaining payment into installments. This way, the provider can incentivize a point of care payment by making it smaller, ensure that they receive an amount up front that they are comfortable with, and still work effectively with patients who need additional financing options.

1 PYMNTS “The Healthcare Payments Experience” (2020)

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