VisitPay, J.P. Morgan partner in new patient financing initiative
Patient financing company VisitPay signed an exclusive agreement with J.P. Morgan Chase Bank for the bank to offer recourse financing for VisitPay’s new Balance Transfer Program.
VisitPay said the deal, announced Wednesday, will allow wholesale funding to healthcare providers.
The program offers an “automated and economically sustainable approach to financing patient receivables,” VisitPay said. The company added that the program will reduce accounts receivable for providers.
The program will extend credit for providers to manage the growth of patient debt connected to high-deductible health plans (HDHPs). Health plans and employers have increasingly turned to HDHPs as a way to contain healthcare costs.
HDHPs accounted for 43% of private health plans for people under 65 in 2017. More people are in HDHPs, but other types of plans like PPOs and HMOs are also increasing deductibles to reduce costs.
However, putting more healthcare costs onto members and employees means a larger portion of providers’ revenue comes from individuals rather than health plans. That requires changes for providers, health systems and hospitals, including possibly adding staff and a different focus on patient billing and financial education rather than simply tracking payments from payers.
“Healthcare consumerism is a significant challenge to health systems because it directly impacts the clinical and business aspects of these institutions,” Kent Ivanoff, VisitPay CEO and co-founder, said. “Patients who put off care because they lack control, choice and options for paying what they owe prevents providers from delivering positive clinical outcomes.”
Patients now make up the third-biggest healthcare payer behind only Medicare and Medicaid. This means health systems and providers need to figure out ways to improve the revenue cycle while helping patients deal with debt. They’re doing this through in-house and third-party financial specialists.
Patient healthcare costs are only going to rise further. A TransUnion Healthcare report earlier this week found that out-of-pocket healthcare costs increased 11% in 2017. The average fourth-quarter 2017 out-of-pocket costs were $1,813 compared to $1,630 in 2016. A large percentage of those rising costs are coming from procedures under $500 per healthcare visit, which shows that out-of-pocket costs aren't usually for one major medical procedure. They’re actually multiple smaller medical bills that add up during the year.
Also, a recent HealthFirst Financial Patient Survey found more than 40% of respondents were “very concerned” or “concerned" about whether they could pay out-of-pocket medical bills over the next two years.