Health-specific credit lines aim to address out-of-pocket expenses

Consumers face sharply rising out-of-pocket expenses this year as they catch up on treatments they postponed because of the pandemic.

Patients paid roughly $810 for out-of-pocket health-care visits, with uninsured patients spending 19 percent more out of pocket than their insured counterparts, according to a PYMNTS report with research sponsored by CareCredit. In addition, 21 percent of patients reported spending more on health care than in previous years.

Specialized lending products are helping fill the gap between what insurance pays and copays, deductibles and uncovered treatment balances. As the health-care industry at large becomes aware of a relatively new entity called the “patient/consumer,” care providers increasingly are are being judged against digital experiences in other aspects of consumer life.

“My digital and consumer experience at a hospital or in health care is compared to my best experience anyplace else in my consumer life,” said Shannon Burke, senior vice president and general manager of health systems for CareCredit. “It requires health systems to think very differently about financing, about options and about that experience, because we now, as patients being consumers, will walk with our feet.”

As the patient/consumer mindset takes hold more widely, people will use specialized health-care credit lines and related digital products in ways that best suit individual needs. Pointing to the random nature of most injury and illness, Burke said a health-care credit line serves as “a very good way to manage that medical expense, because in many cases, they’re not predictable.

“We don’t know when we might fall and hurt ourselves and have to get an X-ray, or find ourselves sick somewhere or our pet eats chocolate and needs to visit the vet. This way, it gives them the protection to be able to pay for their out-of-pocket expenses but allows them to manage their health-care expenses in a specific bucket.”

Although providers and systems benefit in different ways, it’s still about managing spend and cost.

“We’re not only integrated for the patient; we’re integrated for the provider, for the health systems,” Burke said. “That experience, from the office staff to the overall financial experience on the health system side, is also important to note. From the provider lens and the experience that those highly burdened, highly strained health system staffs feels, it’s important to note that financing is also integrated in the back end. It is designed to help the health systems have a good accounts receivable process, increase their revenue, improve their cash flow and reduce their debt risk.”