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Patients Discover Secret to Cutting Their Health-Care Bill | Medical Consumer Financing

Many consumers are finding their way around the financial challenge of the health care industry, and the curious new trend will surprise you. Many hospitals, imaging centers, pharmacy chains and outpatient surgery centers are offering deep discounts to patients who pay cash instead of using their insurance. Consider one case where the patient would have normally paid $600 out of pocket using high-deductible insurance for a knee X-ray. The hospital offered the option of paying $70, instead of the $600, if the patient paid cash upfront.

Some patients welcome these savings with open arms, not giving it another thought. Others, on the other hand, are outraged with their insurance carrier. They feel that things have completely turned upside down. Why? Before, hospitals charged uninsured patients the highest rates. Now, someone who walks in off the street can pay the same as someone paying monthly premiums.  The patient paying upfront in cash is getting a better deal than the individual having insurance plans negotiated for them.

How is this possible? New state and federal rules are focused on protecting uninsured patients from price gouging. Meanwhile, hospitals are pushing for ever-higher rates from commercial insurers in order to make up for losses on other patients.

According to The Wall Street Journal, “Insurers pass those negotiated rates on to plan members, and given the growth in high-deductible plans, more Americans are paying those rates in full, out of pocket, than ever before.”

Understandably so, the growing price transparency has started to change the relationships between payers, providers and patients. Some providers are choosing to keep their cash rates quiet, for fear they will lose their negotiating power with insurers. Others have no problem sharing their low cash prices, eager for the opportunity to compete for business and assist patients who struggle to afford care.

According to Chief Financial Officer, Bill Munson, of Boulder Community Hospital, “Patients have the right under federal law to request that we not bill their insurance. And when they do, they have the right to participate in our self-pay program.”

These changes are also changing things for the merchants in the health care industry. For these businesses, the ability to offer a financing program, which guarantees most customers will be eligible and easily qualify for, is incredibly valuable. For the most part, these financing programs are not a prevalent service.

First American Merchant’s medical consumer financing program, for example, gives medical merchants the power to offer a complete payment solution to customers. As a high-risk specialist, the “high risk” categorization of this industry is not a problem. FAM also understands the value of being able to offer financing to both good credit borrowers and borrowers with a subprime credit score. All in all, FAM’s medical consumer financing program ensures consumers have an affordable way to pay when they are unable to afford the full cost (costs are broken down into affordable monthly payments).

With all these changes, many – merchants and patients – are waiting to see where the future of the health care industry is headed. So far, it seems to be setting patients up to receive the care they need (affordably), while businesses are seizing opportunities to boost sales and attract new customers through options like medical consumer financing programs and medical working capital loans.